Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

48
0 “Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market” Post-Graduate Diploma in Management By Ravi Kumar Roll No. (Pg08-080) Under the guidance of Prof. Deepa Agnihotri Faculty, Marketing Inmantec Business School, Ghaziabad INMANTEC

Transcript of Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

Page 1: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

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ldquoChanging mindsets in Consumption Pattern of SOFT DRINK in Rural Marketrdquo

Post-Graduate Diploma in Management

By

Ravi Kumar

Roll No(Pg08-080)

Under the guidance of

Prof Deepa AgnihotriFaculty Marketing

Inmantec Business School Ghaziabad

INMANTEC Integrated Academy of Management and Technology

Ghaziabad

DateOctober 2009

0

Table of ContentAcknowledgements 01

Preface 02

Objective of study 03

History of the Industry 04

Words of Ministry of Food Processing Industry for Soft Drink Industry 06

Robust growth continues 14

Companies reposition their brands and update product portfolios 14

Main Brands of the Industry 15

Rural Market Scenario 16

Key to success in Rural India 17

Literacy Review 19

Factors influencing buying behavior 22

Factors influencing buying behavior 23

Rural Branding 24

Research Design 25

Source of Data collection 26

Findings 27

Suggestions 28

Conclusion 29

Bibliography 30

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Acknowledgements

I am highly indebted to my project mentor Prof Deepa

Agnihotri for her continuous support supervision

motivation and guidance through out the tenure of my

project in spite of her hectic schedule who truly remained

driving spirit in my project and her experience gave me the

light in handling research project and helped me in clarifying

the abstruse concepts requiring knowledge and perception

handling critical situations and in understanding the

objective of my work

(Ravi Garg)

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Preface

Market provides a key to gain actual success only to those brands which match best to the current environment ie imperative which can be delivered what are the people needs and they are ready to buy at the right time without any delay It is perfectly true but this also depends on availability of good quality products and excellent taste and services which further attract and add a golden opportunity for huge sales

This also depends on the good planning approach and provide ample opportunity plus sufficient amount of products for sales in the coming next financial year

This project introduces study of consumerrsquos preferences for Soft Drink Industry After going through a detail analysis of market behavior and future prospect it may also provide an opportunity to the players those are playing a vital role in the industry to frame a good future plan to satisfy maximum needs of the customers and established its guiding role in throughout the country as a whole The study report will also provide an opportunity to delineate its market potential business areas products amp services are to be offered by the company to the customers

This study report also provides the various factors affecting the services Marketing Division of a soft drink company has to keep in mind various factors specially while preparing a plan for marketing its product or services Detail description along with analysis of surveyed data is being presented in this report

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Aims and Objectives of the study

To study the profile of soft drink consumers

To study the behavioral pattern of rural consumer for soft drink products

To identify their level of satisfaction in the purchase of various soft drink products

To determine the various factors influencing the behavior of soft drink consumer

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History of the Industry

SOFT DRINK INDUSTRIES IN INDIA- A soft drink is a non-alcoholic

beverage It is artificially flavored and contains no fruit or pulp India with population

of more than 100 crores is potentially one of the largest consumer markets in the

world after China The consumer market can be defined as the market for products

and services that are purchased by individuals as households goods for their personal

consumption Soft drink is a typical consumer product purchased by individuals to

quench thirst and secondly for refreshment Searching for the point of Indian soft

drinks we first document on Gold Spot this was the first brand soft drink in India It

was introduced by PARLE during later part of 40rsquos

Cola giant Coca-Cola was the first foreign soft drink to be introduced in India in

1965 Coca-Cola make a very good beginning and dominated the whole scheme right

from the word go It (Coca-Cola) faced no competition at that time COCA COLA

entered India in the year 1993 In collaboration with PARLE INDIA LTD

The marketing people did not even receive to publicize Coca-Cola for it sold first

like probability not-cakes This extraordinary success of soft drinks can be

attributed to the following factors-

Absence of contemporary competitive brand

Euphoric image built up in the Western countries proceeded the entry

into Indian Market and

Indians are very found by nature of foreign goods services etc due to

prolonged foreign rules

Parle Exports (P) Ltd later in 1970 introduced Limca Lemony Soft drinks Before

Limca introduce they had tentatively introduced Cola Pepino which they had to

soon withdraw in the face of battering confrontation with Coca-Cola

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Three of four groups of Indians companies who had the required production capacity

started their own brands of Cola Lemon Orange but failed to achieve their goal on a

national basis India always has love and hate relationship with MNCrsquos which gave a

significant opportunities to soft drink industries in India when Coca-Cola decided to

windup its operation in 1977 rather than bowing to the Indian government insisting

on-

Dilution of equity as the government felt that lots of foreign currency was

being wasted

Manufacturing of the top-secret concentration in India

Disclose of the chemical composition of the essence

This left a large vacuum in the popular soft drink market and a vista was opened to

any company with the requisite technical marketing and organizational skills

The exit of Coca-Cola from India in 1977 accelerated the growth of several Indian

Soft Drink New soft drink in the form of Tetra pack entered the market among

Frooti Jump-In and Treetop were the prominent once Till 1977 their equipped

bottling plants and the distribution network a longing to be of no use It took them one

year to develop new formula to survive and gradually came up with Campa Lemon

Orange and Cola that order

However Parle the pioneer in the soft drinks blazed its way to national prominence

with their product ldquoThumps Uprdquo bearing the slogan ldquoHappy Days Are Here Againrdquo

This particular slogan helped to win over the loyalists or addicts to Coca-Cola who

was in the state of ldquoCola Shockrdquo or Cola Depression Soon the Indian Soft drink

industry started at a phenomenal rate and all Parle Products Gold Spot Limca and

Thumps Up became the brand leader in their own segment In spite of all these the

drink market still has large gap as claim by soft drink manufacturers To fill these

gaps there are many soft drinks concentrate and squashes flooded the market The

Indian soft markets basically offered three flavors ie Orange Lemon and Cola

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Words of Ministry of Food Processing

Industry for Soft Drink Industry

The 50-bn-rupee soft drink industry is growing now at 6 to 7 annually In India

Coke and Pepsi have a combined market share of around 95 directly or through

franchisees Campa Cola has a 1 share and the rest is divided among local

players Industry watchers say fake products also account for a good share of the

balance There are about 110 soft drink producing units (60 being owned by

Indian bottlers) in the country employing about 125000 people There are two

distinct segments of the market cola and non-cola drinks The cola segment claims

a share of 62 while the non-cola segment includes soda clear lime cloudy lime

and drinks with orange and mango flavors

The per capita consumption of soft drinks in India is around 5 to 6 bottles (same as

Nepals) compared to Pakistans 17 bottles Sri Lankas 21 Thailands 73 the

Philippines 173 and Mexico 605 The industry contributes over Rs 12 bn to the

exchequer and exports goods worth Rs 2 bn It also supports growth of industries

like glass refrigeration transportation paper and sugar The Department of Food

Processing Industries had stipulated that contains-no-fruit-juice labels be pasted

on returnable glass bottles About 85 of the soft drinks are currently sold in

returnable bottles There was a floating stock of about 1000 mn bottles valued at

Rs 6 bn If the industry were to abide by the new guidelines it would have to

invest in new bottles resulting in a cost outgo of Rs 5 bn Neither Coke nor Pepsi

is in a position to invest such a large amount

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Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

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Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

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Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

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Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

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Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

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Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

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LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

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3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

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Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 2: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Table of ContentAcknowledgements 01

Preface 02

Objective of study 03

History of the Industry 04

Words of Ministry of Food Processing Industry for Soft Drink Industry 06

Robust growth continues 14

Companies reposition their brands and update product portfolios 14

Main Brands of the Industry 15

Rural Market Scenario 16

Key to success in Rural India 17

Literacy Review 19

Factors influencing buying behavior 22

Factors influencing buying behavior 23

Rural Branding 24

Research Design 25

Source of Data collection 26

Findings 27

Suggestions 28

Conclusion 29

Bibliography 30

0

Acknowledgements

I am highly indebted to my project mentor Prof Deepa

Agnihotri for her continuous support supervision

motivation and guidance through out the tenure of my

project in spite of her hectic schedule who truly remained

driving spirit in my project and her experience gave me the

light in handling research project and helped me in clarifying

the abstruse concepts requiring knowledge and perception

handling critical situations and in understanding the

objective of my work

(Ravi Garg)

0

Preface

Market provides a key to gain actual success only to those brands which match best to the current environment ie imperative which can be delivered what are the people needs and they are ready to buy at the right time without any delay It is perfectly true but this also depends on availability of good quality products and excellent taste and services which further attract and add a golden opportunity for huge sales

This also depends on the good planning approach and provide ample opportunity plus sufficient amount of products for sales in the coming next financial year

This project introduces study of consumerrsquos preferences for Soft Drink Industry After going through a detail analysis of market behavior and future prospect it may also provide an opportunity to the players those are playing a vital role in the industry to frame a good future plan to satisfy maximum needs of the customers and established its guiding role in throughout the country as a whole The study report will also provide an opportunity to delineate its market potential business areas products amp services are to be offered by the company to the customers

This study report also provides the various factors affecting the services Marketing Division of a soft drink company has to keep in mind various factors specially while preparing a plan for marketing its product or services Detail description along with analysis of surveyed data is being presented in this report

0

Aims and Objectives of the study

To study the profile of soft drink consumers

To study the behavioral pattern of rural consumer for soft drink products

To identify their level of satisfaction in the purchase of various soft drink products

To determine the various factors influencing the behavior of soft drink consumer

0

History of the Industry

SOFT DRINK INDUSTRIES IN INDIA- A soft drink is a non-alcoholic

beverage It is artificially flavored and contains no fruit or pulp India with population

of more than 100 crores is potentially one of the largest consumer markets in the

world after China The consumer market can be defined as the market for products

and services that are purchased by individuals as households goods for their personal

consumption Soft drink is a typical consumer product purchased by individuals to

quench thirst and secondly for refreshment Searching for the point of Indian soft

drinks we first document on Gold Spot this was the first brand soft drink in India It

was introduced by PARLE during later part of 40rsquos

Cola giant Coca-Cola was the first foreign soft drink to be introduced in India in

1965 Coca-Cola make a very good beginning and dominated the whole scheme right

from the word go It (Coca-Cola) faced no competition at that time COCA COLA

entered India in the year 1993 In collaboration with PARLE INDIA LTD

The marketing people did not even receive to publicize Coca-Cola for it sold first

like probability not-cakes This extraordinary success of soft drinks can be

attributed to the following factors-

Absence of contemporary competitive brand

Euphoric image built up in the Western countries proceeded the entry

into Indian Market and

Indians are very found by nature of foreign goods services etc due to

prolonged foreign rules

Parle Exports (P) Ltd later in 1970 introduced Limca Lemony Soft drinks Before

Limca introduce they had tentatively introduced Cola Pepino which they had to

soon withdraw in the face of battering confrontation with Coca-Cola

0

Three of four groups of Indians companies who had the required production capacity

started their own brands of Cola Lemon Orange but failed to achieve their goal on a

national basis India always has love and hate relationship with MNCrsquos which gave a

significant opportunities to soft drink industries in India when Coca-Cola decided to

windup its operation in 1977 rather than bowing to the Indian government insisting

on-

Dilution of equity as the government felt that lots of foreign currency was

being wasted

Manufacturing of the top-secret concentration in India

Disclose of the chemical composition of the essence

This left a large vacuum in the popular soft drink market and a vista was opened to

any company with the requisite technical marketing and organizational skills

The exit of Coca-Cola from India in 1977 accelerated the growth of several Indian

Soft Drink New soft drink in the form of Tetra pack entered the market among

Frooti Jump-In and Treetop were the prominent once Till 1977 their equipped

bottling plants and the distribution network a longing to be of no use It took them one

year to develop new formula to survive and gradually came up with Campa Lemon

Orange and Cola that order

However Parle the pioneer in the soft drinks blazed its way to national prominence

with their product ldquoThumps Uprdquo bearing the slogan ldquoHappy Days Are Here Againrdquo

This particular slogan helped to win over the loyalists or addicts to Coca-Cola who

was in the state of ldquoCola Shockrdquo or Cola Depression Soon the Indian Soft drink

industry started at a phenomenal rate and all Parle Products Gold Spot Limca and

Thumps Up became the brand leader in their own segment In spite of all these the

drink market still has large gap as claim by soft drink manufacturers To fill these

gaps there are many soft drinks concentrate and squashes flooded the market The

Indian soft markets basically offered three flavors ie Orange Lemon and Cola

0

Words of Ministry of Food Processing

Industry for Soft Drink Industry

The 50-bn-rupee soft drink industry is growing now at 6 to 7 annually In India

Coke and Pepsi have a combined market share of around 95 directly or through

franchisees Campa Cola has a 1 share and the rest is divided among local

players Industry watchers say fake products also account for a good share of the

balance There are about 110 soft drink producing units (60 being owned by

Indian bottlers) in the country employing about 125000 people There are two

distinct segments of the market cola and non-cola drinks The cola segment claims

a share of 62 while the non-cola segment includes soda clear lime cloudy lime

and drinks with orange and mango flavors

The per capita consumption of soft drinks in India is around 5 to 6 bottles (same as

Nepals) compared to Pakistans 17 bottles Sri Lankas 21 Thailands 73 the

Philippines 173 and Mexico 605 The industry contributes over Rs 12 bn to the

exchequer and exports goods worth Rs 2 bn It also supports growth of industries

like glass refrigeration transportation paper and sugar The Department of Food

Processing Industries had stipulated that contains-no-fruit-juice labels be pasted

on returnable glass bottles About 85 of the soft drinks are currently sold in

returnable bottles There was a floating stock of about 1000 mn bottles valued at

Rs 6 bn If the industry were to abide by the new guidelines it would have to

invest in new bottles resulting in a cost outgo of Rs 5 bn Neither Coke nor Pepsi

is in a position to invest such a large amount

0

Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 3: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Acknowledgements

I am highly indebted to my project mentor Prof Deepa

Agnihotri for her continuous support supervision

motivation and guidance through out the tenure of my

project in spite of her hectic schedule who truly remained

driving spirit in my project and her experience gave me the

light in handling research project and helped me in clarifying

the abstruse concepts requiring knowledge and perception

handling critical situations and in understanding the

objective of my work

(Ravi Garg)

0

Preface

Market provides a key to gain actual success only to those brands which match best to the current environment ie imperative which can be delivered what are the people needs and they are ready to buy at the right time without any delay It is perfectly true but this also depends on availability of good quality products and excellent taste and services which further attract and add a golden opportunity for huge sales

This also depends on the good planning approach and provide ample opportunity plus sufficient amount of products for sales in the coming next financial year

This project introduces study of consumerrsquos preferences for Soft Drink Industry After going through a detail analysis of market behavior and future prospect it may also provide an opportunity to the players those are playing a vital role in the industry to frame a good future plan to satisfy maximum needs of the customers and established its guiding role in throughout the country as a whole The study report will also provide an opportunity to delineate its market potential business areas products amp services are to be offered by the company to the customers

This study report also provides the various factors affecting the services Marketing Division of a soft drink company has to keep in mind various factors specially while preparing a plan for marketing its product or services Detail description along with analysis of surveyed data is being presented in this report

0

Aims and Objectives of the study

To study the profile of soft drink consumers

To study the behavioral pattern of rural consumer for soft drink products

To identify their level of satisfaction in the purchase of various soft drink products

To determine the various factors influencing the behavior of soft drink consumer

0

History of the Industry

SOFT DRINK INDUSTRIES IN INDIA- A soft drink is a non-alcoholic

beverage It is artificially flavored and contains no fruit or pulp India with population

of more than 100 crores is potentially one of the largest consumer markets in the

world after China The consumer market can be defined as the market for products

and services that are purchased by individuals as households goods for their personal

consumption Soft drink is a typical consumer product purchased by individuals to

quench thirst and secondly for refreshment Searching for the point of Indian soft

drinks we first document on Gold Spot this was the first brand soft drink in India It

was introduced by PARLE during later part of 40rsquos

Cola giant Coca-Cola was the first foreign soft drink to be introduced in India in

1965 Coca-Cola make a very good beginning and dominated the whole scheme right

from the word go It (Coca-Cola) faced no competition at that time COCA COLA

entered India in the year 1993 In collaboration with PARLE INDIA LTD

The marketing people did not even receive to publicize Coca-Cola for it sold first

like probability not-cakes This extraordinary success of soft drinks can be

attributed to the following factors-

Absence of contemporary competitive brand

Euphoric image built up in the Western countries proceeded the entry

into Indian Market and

Indians are very found by nature of foreign goods services etc due to

prolonged foreign rules

Parle Exports (P) Ltd later in 1970 introduced Limca Lemony Soft drinks Before

Limca introduce they had tentatively introduced Cola Pepino which they had to

soon withdraw in the face of battering confrontation with Coca-Cola

0

Three of four groups of Indians companies who had the required production capacity

started their own brands of Cola Lemon Orange but failed to achieve their goal on a

national basis India always has love and hate relationship with MNCrsquos which gave a

significant opportunities to soft drink industries in India when Coca-Cola decided to

windup its operation in 1977 rather than bowing to the Indian government insisting

on-

Dilution of equity as the government felt that lots of foreign currency was

being wasted

Manufacturing of the top-secret concentration in India

Disclose of the chemical composition of the essence

This left a large vacuum in the popular soft drink market and a vista was opened to

any company with the requisite technical marketing and organizational skills

The exit of Coca-Cola from India in 1977 accelerated the growth of several Indian

Soft Drink New soft drink in the form of Tetra pack entered the market among

Frooti Jump-In and Treetop were the prominent once Till 1977 their equipped

bottling plants and the distribution network a longing to be of no use It took them one

year to develop new formula to survive and gradually came up with Campa Lemon

Orange and Cola that order

However Parle the pioneer in the soft drinks blazed its way to national prominence

with their product ldquoThumps Uprdquo bearing the slogan ldquoHappy Days Are Here Againrdquo

This particular slogan helped to win over the loyalists or addicts to Coca-Cola who

was in the state of ldquoCola Shockrdquo or Cola Depression Soon the Indian Soft drink

industry started at a phenomenal rate and all Parle Products Gold Spot Limca and

Thumps Up became the brand leader in their own segment In spite of all these the

drink market still has large gap as claim by soft drink manufacturers To fill these

gaps there are many soft drinks concentrate and squashes flooded the market The

Indian soft markets basically offered three flavors ie Orange Lemon and Cola

0

Words of Ministry of Food Processing

Industry for Soft Drink Industry

The 50-bn-rupee soft drink industry is growing now at 6 to 7 annually In India

Coke and Pepsi have a combined market share of around 95 directly or through

franchisees Campa Cola has a 1 share and the rest is divided among local

players Industry watchers say fake products also account for a good share of the

balance There are about 110 soft drink producing units (60 being owned by

Indian bottlers) in the country employing about 125000 people There are two

distinct segments of the market cola and non-cola drinks The cola segment claims

a share of 62 while the non-cola segment includes soda clear lime cloudy lime

and drinks with orange and mango flavors

The per capita consumption of soft drinks in India is around 5 to 6 bottles (same as

Nepals) compared to Pakistans 17 bottles Sri Lankas 21 Thailands 73 the

Philippines 173 and Mexico 605 The industry contributes over Rs 12 bn to the

exchequer and exports goods worth Rs 2 bn It also supports growth of industries

like glass refrigeration transportation paper and sugar The Department of Food

Processing Industries had stipulated that contains-no-fruit-juice labels be pasted

on returnable glass bottles About 85 of the soft drinks are currently sold in

returnable bottles There was a floating stock of about 1000 mn bottles valued at

Rs 6 bn If the industry were to abide by the new guidelines it would have to

invest in new bottles resulting in a cost outgo of Rs 5 bn Neither Coke nor Pepsi

is in a position to invest such a large amount

0

Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 4: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Preface

Market provides a key to gain actual success only to those brands which match best to the current environment ie imperative which can be delivered what are the people needs and they are ready to buy at the right time without any delay It is perfectly true but this also depends on availability of good quality products and excellent taste and services which further attract and add a golden opportunity for huge sales

This also depends on the good planning approach and provide ample opportunity plus sufficient amount of products for sales in the coming next financial year

This project introduces study of consumerrsquos preferences for Soft Drink Industry After going through a detail analysis of market behavior and future prospect it may also provide an opportunity to the players those are playing a vital role in the industry to frame a good future plan to satisfy maximum needs of the customers and established its guiding role in throughout the country as a whole The study report will also provide an opportunity to delineate its market potential business areas products amp services are to be offered by the company to the customers

This study report also provides the various factors affecting the services Marketing Division of a soft drink company has to keep in mind various factors specially while preparing a plan for marketing its product or services Detail description along with analysis of surveyed data is being presented in this report

0

Aims and Objectives of the study

To study the profile of soft drink consumers

To study the behavioral pattern of rural consumer for soft drink products

To identify their level of satisfaction in the purchase of various soft drink products

To determine the various factors influencing the behavior of soft drink consumer

0

History of the Industry

SOFT DRINK INDUSTRIES IN INDIA- A soft drink is a non-alcoholic

beverage It is artificially flavored and contains no fruit or pulp India with population

of more than 100 crores is potentially one of the largest consumer markets in the

world after China The consumer market can be defined as the market for products

and services that are purchased by individuals as households goods for their personal

consumption Soft drink is a typical consumer product purchased by individuals to

quench thirst and secondly for refreshment Searching for the point of Indian soft

drinks we first document on Gold Spot this was the first brand soft drink in India It

was introduced by PARLE during later part of 40rsquos

Cola giant Coca-Cola was the first foreign soft drink to be introduced in India in

1965 Coca-Cola make a very good beginning and dominated the whole scheme right

from the word go It (Coca-Cola) faced no competition at that time COCA COLA

entered India in the year 1993 In collaboration with PARLE INDIA LTD

The marketing people did not even receive to publicize Coca-Cola for it sold first

like probability not-cakes This extraordinary success of soft drinks can be

attributed to the following factors-

Absence of contemporary competitive brand

Euphoric image built up in the Western countries proceeded the entry

into Indian Market and

Indians are very found by nature of foreign goods services etc due to

prolonged foreign rules

Parle Exports (P) Ltd later in 1970 introduced Limca Lemony Soft drinks Before

Limca introduce they had tentatively introduced Cola Pepino which they had to

soon withdraw in the face of battering confrontation with Coca-Cola

0

Three of four groups of Indians companies who had the required production capacity

started their own brands of Cola Lemon Orange but failed to achieve their goal on a

national basis India always has love and hate relationship with MNCrsquos which gave a

significant opportunities to soft drink industries in India when Coca-Cola decided to

windup its operation in 1977 rather than bowing to the Indian government insisting

on-

Dilution of equity as the government felt that lots of foreign currency was

being wasted

Manufacturing of the top-secret concentration in India

Disclose of the chemical composition of the essence

This left a large vacuum in the popular soft drink market and a vista was opened to

any company with the requisite technical marketing and organizational skills

The exit of Coca-Cola from India in 1977 accelerated the growth of several Indian

Soft Drink New soft drink in the form of Tetra pack entered the market among

Frooti Jump-In and Treetop were the prominent once Till 1977 their equipped

bottling plants and the distribution network a longing to be of no use It took them one

year to develop new formula to survive and gradually came up with Campa Lemon

Orange and Cola that order

However Parle the pioneer in the soft drinks blazed its way to national prominence

with their product ldquoThumps Uprdquo bearing the slogan ldquoHappy Days Are Here Againrdquo

This particular slogan helped to win over the loyalists or addicts to Coca-Cola who

was in the state of ldquoCola Shockrdquo or Cola Depression Soon the Indian Soft drink

industry started at a phenomenal rate and all Parle Products Gold Spot Limca and

Thumps Up became the brand leader in their own segment In spite of all these the

drink market still has large gap as claim by soft drink manufacturers To fill these

gaps there are many soft drinks concentrate and squashes flooded the market The

Indian soft markets basically offered three flavors ie Orange Lemon and Cola

0

Words of Ministry of Food Processing

Industry for Soft Drink Industry

The 50-bn-rupee soft drink industry is growing now at 6 to 7 annually In India

Coke and Pepsi have a combined market share of around 95 directly or through

franchisees Campa Cola has a 1 share and the rest is divided among local

players Industry watchers say fake products also account for a good share of the

balance There are about 110 soft drink producing units (60 being owned by

Indian bottlers) in the country employing about 125000 people There are two

distinct segments of the market cola and non-cola drinks The cola segment claims

a share of 62 while the non-cola segment includes soda clear lime cloudy lime

and drinks with orange and mango flavors

The per capita consumption of soft drinks in India is around 5 to 6 bottles (same as

Nepals) compared to Pakistans 17 bottles Sri Lankas 21 Thailands 73 the

Philippines 173 and Mexico 605 The industry contributes over Rs 12 bn to the

exchequer and exports goods worth Rs 2 bn It also supports growth of industries

like glass refrigeration transportation paper and sugar The Department of Food

Processing Industries had stipulated that contains-no-fruit-juice labels be pasted

on returnable glass bottles About 85 of the soft drinks are currently sold in

returnable bottles There was a floating stock of about 1000 mn bottles valued at

Rs 6 bn If the industry were to abide by the new guidelines it would have to

invest in new bottles resulting in a cost outgo of Rs 5 bn Neither Coke nor Pepsi

is in a position to invest such a large amount

0

Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 5: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Aims and Objectives of the study

To study the profile of soft drink consumers

To study the behavioral pattern of rural consumer for soft drink products

To identify their level of satisfaction in the purchase of various soft drink products

To determine the various factors influencing the behavior of soft drink consumer

0

History of the Industry

SOFT DRINK INDUSTRIES IN INDIA- A soft drink is a non-alcoholic

beverage It is artificially flavored and contains no fruit or pulp India with population

of more than 100 crores is potentially one of the largest consumer markets in the

world after China The consumer market can be defined as the market for products

and services that are purchased by individuals as households goods for their personal

consumption Soft drink is a typical consumer product purchased by individuals to

quench thirst and secondly for refreshment Searching for the point of Indian soft

drinks we first document on Gold Spot this was the first brand soft drink in India It

was introduced by PARLE during later part of 40rsquos

Cola giant Coca-Cola was the first foreign soft drink to be introduced in India in

1965 Coca-Cola make a very good beginning and dominated the whole scheme right

from the word go It (Coca-Cola) faced no competition at that time COCA COLA

entered India in the year 1993 In collaboration with PARLE INDIA LTD

The marketing people did not even receive to publicize Coca-Cola for it sold first

like probability not-cakes This extraordinary success of soft drinks can be

attributed to the following factors-

Absence of contemporary competitive brand

Euphoric image built up in the Western countries proceeded the entry

into Indian Market and

Indians are very found by nature of foreign goods services etc due to

prolonged foreign rules

Parle Exports (P) Ltd later in 1970 introduced Limca Lemony Soft drinks Before

Limca introduce they had tentatively introduced Cola Pepino which they had to

soon withdraw in the face of battering confrontation with Coca-Cola

0

Three of four groups of Indians companies who had the required production capacity

started their own brands of Cola Lemon Orange but failed to achieve their goal on a

national basis India always has love and hate relationship with MNCrsquos which gave a

significant opportunities to soft drink industries in India when Coca-Cola decided to

windup its operation in 1977 rather than bowing to the Indian government insisting

on-

Dilution of equity as the government felt that lots of foreign currency was

being wasted

Manufacturing of the top-secret concentration in India

Disclose of the chemical composition of the essence

This left a large vacuum in the popular soft drink market and a vista was opened to

any company with the requisite technical marketing and organizational skills

The exit of Coca-Cola from India in 1977 accelerated the growth of several Indian

Soft Drink New soft drink in the form of Tetra pack entered the market among

Frooti Jump-In and Treetop were the prominent once Till 1977 their equipped

bottling plants and the distribution network a longing to be of no use It took them one

year to develop new formula to survive and gradually came up with Campa Lemon

Orange and Cola that order

However Parle the pioneer in the soft drinks blazed its way to national prominence

with their product ldquoThumps Uprdquo bearing the slogan ldquoHappy Days Are Here Againrdquo

This particular slogan helped to win over the loyalists or addicts to Coca-Cola who

was in the state of ldquoCola Shockrdquo or Cola Depression Soon the Indian Soft drink

industry started at a phenomenal rate and all Parle Products Gold Spot Limca and

Thumps Up became the brand leader in their own segment In spite of all these the

drink market still has large gap as claim by soft drink manufacturers To fill these

gaps there are many soft drinks concentrate and squashes flooded the market The

Indian soft markets basically offered three flavors ie Orange Lemon and Cola

0

Words of Ministry of Food Processing

Industry for Soft Drink Industry

The 50-bn-rupee soft drink industry is growing now at 6 to 7 annually In India

Coke and Pepsi have a combined market share of around 95 directly or through

franchisees Campa Cola has a 1 share and the rest is divided among local

players Industry watchers say fake products also account for a good share of the

balance There are about 110 soft drink producing units (60 being owned by

Indian bottlers) in the country employing about 125000 people There are two

distinct segments of the market cola and non-cola drinks The cola segment claims

a share of 62 while the non-cola segment includes soda clear lime cloudy lime

and drinks with orange and mango flavors

The per capita consumption of soft drinks in India is around 5 to 6 bottles (same as

Nepals) compared to Pakistans 17 bottles Sri Lankas 21 Thailands 73 the

Philippines 173 and Mexico 605 The industry contributes over Rs 12 bn to the

exchequer and exports goods worth Rs 2 bn It also supports growth of industries

like glass refrigeration transportation paper and sugar The Department of Food

Processing Industries had stipulated that contains-no-fruit-juice labels be pasted

on returnable glass bottles About 85 of the soft drinks are currently sold in

returnable bottles There was a floating stock of about 1000 mn bottles valued at

Rs 6 bn If the industry were to abide by the new guidelines it would have to

invest in new bottles resulting in a cost outgo of Rs 5 bn Neither Coke nor Pepsi

is in a position to invest such a large amount

0

Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 6: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

History of the Industry

SOFT DRINK INDUSTRIES IN INDIA- A soft drink is a non-alcoholic

beverage It is artificially flavored and contains no fruit or pulp India with population

of more than 100 crores is potentially one of the largest consumer markets in the

world after China The consumer market can be defined as the market for products

and services that are purchased by individuals as households goods for their personal

consumption Soft drink is a typical consumer product purchased by individuals to

quench thirst and secondly for refreshment Searching for the point of Indian soft

drinks we first document on Gold Spot this was the first brand soft drink in India It

was introduced by PARLE during later part of 40rsquos

Cola giant Coca-Cola was the first foreign soft drink to be introduced in India in

1965 Coca-Cola make a very good beginning and dominated the whole scheme right

from the word go It (Coca-Cola) faced no competition at that time COCA COLA

entered India in the year 1993 In collaboration with PARLE INDIA LTD

The marketing people did not even receive to publicize Coca-Cola for it sold first

like probability not-cakes This extraordinary success of soft drinks can be

attributed to the following factors-

Absence of contemporary competitive brand

Euphoric image built up in the Western countries proceeded the entry

into Indian Market and

Indians are very found by nature of foreign goods services etc due to

prolonged foreign rules

Parle Exports (P) Ltd later in 1970 introduced Limca Lemony Soft drinks Before

Limca introduce they had tentatively introduced Cola Pepino which they had to

soon withdraw in the face of battering confrontation with Coca-Cola

0

Three of four groups of Indians companies who had the required production capacity

started their own brands of Cola Lemon Orange but failed to achieve their goal on a

national basis India always has love and hate relationship with MNCrsquos which gave a

significant opportunities to soft drink industries in India when Coca-Cola decided to

windup its operation in 1977 rather than bowing to the Indian government insisting

on-

Dilution of equity as the government felt that lots of foreign currency was

being wasted

Manufacturing of the top-secret concentration in India

Disclose of the chemical composition of the essence

This left a large vacuum in the popular soft drink market and a vista was opened to

any company with the requisite technical marketing and organizational skills

The exit of Coca-Cola from India in 1977 accelerated the growth of several Indian

Soft Drink New soft drink in the form of Tetra pack entered the market among

Frooti Jump-In and Treetop were the prominent once Till 1977 their equipped

bottling plants and the distribution network a longing to be of no use It took them one

year to develop new formula to survive and gradually came up with Campa Lemon

Orange and Cola that order

However Parle the pioneer in the soft drinks blazed its way to national prominence

with their product ldquoThumps Uprdquo bearing the slogan ldquoHappy Days Are Here Againrdquo

This particular slogan helped to win over the loyalists or addicts to Coca-Cola who

was in the state of ldquoCola Shockrdquo or Cola Depression Soon the Indian Soft drink

industry started at a phenomenal rate and all Parle Products Gold Spot Limca and

Thumps Up became the brand leader in their own segment In spite of all these the

drink market still has large gap as claim by soft drink manufacturers To fill these

gaps there are many soft drinks concentrate and squashes flooded the market The

Indian soft markets basically offered three flavors ie Orange Lemon and Cola

0

Words of Ministry of Food Processing

Industry for Soft Drink Industry

The 50-bn-rupee soft drink industry is growing now at 6 to 7 annually In India

Coke and Pepsi have a combined market share of around 95 directly or through

franchisees Campa Cola has a 1 share and the rest is divided among local

players Industry watchers say fake products also account for a good share of the

balance There are about 110 soft drink producing units (60 being owned by

Indian bottlers) in the country employing about 125000 people There are two

distinct segments of the market cola and non-cola drinks The cola segment claims

a share of 62 while the non-cola segment includes soda clear lime cloudy lime

and drinks with orange and mango flavors

The per capita consumption of soft drinks in India is around 5 to 6 bottles (same as

Nepals) compared to Pakistans 17 bottles Sri Lankas 21 Thailands 73 the

Philippines 173 and Mexico 605 The industry contributes over Rs 12 bn to the

exchequer and exports goods worth Rs 2 bn It also supports growth of industries

like glass refrigeration transportation paper and sugar The Department of Food

Processing Industries had stipulated that contains-no-fruit-juice labels be pasted

on returnable glass bottles About 85 of the soft drinks are currently sold in

returnable bottles There was a floating stock of about 1000 mn bottles valued at

Rs 6 bn If the industry were to abide by the new guidelines it would have to

invest in new bottles resulting in a cost outgo of Rs 5 bn Neither Coke nor Pepsi

is in a position to invest such a large amount

0

Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 7: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Three of four groups of Indians companies who had the required production capacity

started their own brands of Cola Lemon Orange but failed to achieve their goal on a

national basis India always has love and hate relationship with MNCrsquos which gave a

significant opportunities to soft drink industries in India when Coca-Cola decided to

windup its operation in 1977 rather than bowing to the Indian government insisting

on-

Dilution of equity as the government felt that lots of foreign currency was

being wasted

Manufacturing of the top-secret concentration in India

Disclose of the chemical composition of the essence

This left a large vacuum in the popular soft drink market and a vista was opened to

any company with the requisite technical marketing and organizational skills

The exit of Coca-Cola from India in 1977 accelerated the growth of several Indian

Soft Drink New soft drink in the form of Tetra pack entered the market among

Frooti Jump-In and Treetop were the prominent once Till 1977 their equipped

bottling plants and the distribution network a longing to be of no use It took them one

year to develop new formula to survive and gradually came up with Campa Lemon

Orange and Cola that order

However Parle the pioneer in the soft drinks blazed its way to national prominence

with their product ldquoThumps Uprdquo bearing the slogan ldquoHappy Days Are Here Againrdquo

This particular slogan helped to win over the loyalists or addicts to Coca-Cola who

was in the state of ldquoCola Shockrdquo or Cola Depression Soon the Indian Soft drink

industry started at a phenomenal rate and all Parle Products Gold Spot Limca and

Thumps Up became the brand leader in their own segment In spite of all these the

drink market still has large gap as claim by soft drink manufacturers To fill these

gaps there are many soft drinks concentrate and squashes flooded the market The

Indian soft markets basically offered three flavors ie Orange Lemon and Cola

0

Words of Ministry of Food Processing

Industry for Soft Drink Industry

The 50-bn-rupee soft drink industry is growing now at 6 to 7 annually In India

Coke and Pepsi have a combined market share of around 95 directly or through

franchisees Campa Cola has a 1 share and the rest is divided among local

players Industry watchers say fake products also account for a good share of the

balance There are about 110 soft drink producing units (60 being owned by

Indian bottlers) in the country employing about 125000 people There are two

distinct segments of the market cola and non-cola drinks The cola segment claims

a share of 62 while the non-cola segment includes soda clear lime cloudy lime

and drinks with orange and mango flavors

The per capita consumption of soft drinks in India is around 5 to 6 bottles (same as

Nepals) compared to Pakistans 17 bottles Sri Lankas 21 Thailands 73 the

Philippines 173 and Mexico 605 The industry contributes over Rs 12 bn to the

exchequer and exports goods worth Rs 2 bn It also supports growth of industries

like glass refrigeration transportation paper and sugar The Department of Food

Processing Industries had stipulated that contains-no-fruit-juice labels be pasted

on returnable glass bottles About 85 of the soft drinks are currently sold in

returnable bottles There was a floating stock of about 1000 mn bottles valued at

Rs 6 bn If the industry were to abide by the new guidelines it would have to

invest in new bottles resulting in a cost outgo of Rs 5 bn Neither Coke nor Pepsi

is in a position to invest such a large amount

0

Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 8: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Words of Ministry of Food Processing

Industry for Soft Drink Industry

The 50-bn-rupee soft drink industry is growing now at 6 to 7 annually In India

Coke and Pepsi have a combined market share of around 95 directly or through

franchisees Campa Cola has a 1 share and the rest is divided among local

players Industry watchers say fake products also account for a good share of the

balance There are about 110 soft drink producing units (60 being owned by

Indian bottlers) in the country employing about 125000 people There are two

distinct segments of the market cola and non-cola drinks The cola segment claims

a share of 62 while the non-cola segment includes soda clear lime cloudy lime

and drinks with orange and mango flavors

The per capita consumption of soft drinks in India is around 5 to 6 bottles (same as

Nepals) compared to Pakistans 17 bottles Sri Lankas 21 Thailands 73 the

Philippines 173 and Mexico 605 The industry contributes over Rs 12 bn to the

exchequer and exports goods worth Rs 2 bn It also supports growth of industries

like glass refrigeration transportation paper and sugar The Department of Food

Processing Industries had stipulated that contains-no-fruit-juice labels be pasted

on returnable glass bottles About 85 of the soft drinks are currently sold in

returnable bottles There was a floating stock of about 1000 mn bottles valued at

Rs 6 bn If the industry were to abide by the new guidelines it would have to

invest in new bottles resulting in a cost outgo of Rs 5 bn Neither Coke nor Pepsi

is in a position to invest such a large amount

0

Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 9: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Around 400000 tonnes of raw material would be required to replace the existing

stock of bottles Instead the soft drink industry suggested that a seven-year

moratorium be extended to the industry so that it can incorporate the change in a

phased manner There is no such mandatory requirement anywhere in the world to

specifically label the glass surface of returnable bottles The government has

decided to extend the date for replacing the bottles to end-march 2006 In the

meantime the producers have shifted substantially to the use of PET bottles

Soft and aerated drinks were considered products for the middle class and the

affluent That segregation is no more valid Soft and aerated drinks are consumed

by all except those who cannot afford to buy any drink An NCAER study says

that 91 soft drink sales are made to the lower middle and upper middle classes

The soft drink industry has been urging the government to categorize aerated

waters (soft drinks) equitably with other consumer products of mass consumption

and remove special excise duty

The industry estimates that the beverage market should grow at twice the rate of

GDP growth The Indian market should have therefore grown by at least 12

However it has been growing at a rate of about 6 In contrast the Chinese

market grew by 16 a year while the Russian market expanded at almost four

times the rate of growth of the Indian market

It may be recalled that Coca-Cola the worlds number one player was present in

India for a long time in collaboration with an Indian producer but was thrown out

in the late 1970s It reappeared in India following the economic liberalization era

- but after its rival worlds number two had already entered in a big way following

a long and tough fight against the opposition from the domestic producers When

Coca-Cola re-entered it installed a new milestone It acquired the well flourishing

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 10: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Indias top player Parle Since then it is basically a fight between the two

American giants Others are playing a peripheral role as adjuncts to the two

MNCs Worlds third biggest player Cadbury Schweppes had also made an

entry but was gobbled up by Coca-Cola When Coca-Cola acquired Parle brands it

was in fact buying the bottling facilities the marketing network and the

established consumer preference during the market build-up The brands were a

drag on the global brand Since Coca-Cola was not interested in brands (like

Thumps Up) it did not promote them The result at least in the short run was a

loss of the market to the competitor Coca-Cola decided to market more effectively

the Parle brands It had in its armoury Coke Thumps Up Limca and Fanta The

latest to enter market was Parlersquos erstwhile Rimzim alongside Portello a black

currant flavoured drink very popular in Srilanka

Coca-Cola operates through 35 plants and 16 franchisees throughout the country

while PepsiCo has 20 plants but it has 7 more franchisees at 23 to 16 of its rival

Coca-Cola claims a market share of 51 while Pepsi has a share of 46 The

claims however remain disputed The other smaller players like Pure Drinks Ltd

claim the rest of the market The shares of the two lead players are consolidated

figures which include the respective bottlers Coca-Cola had approached the

government for a five year extension for divesting 49 equity in its bottling

subsidiary Hindustan Coca-Cola Holdings It had set up the marketing subsidiary

as part of its strategy to integrate all its bottling operations both company-

owned and franchisee bottlers apparently keeping in line with its global policy

All together it had bought initially over 38 franchisee bottlers

Kandhari Beverages coke bottlers for north have been eyeing to lift a stake in

Coca-Cola India Coca-Cola had filed an application to offload 49 stake of its

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 11: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

bottling operations in favour of their Indian operators Besides Kandhari three

other bottlers one each from Uttar Pradesh Gujarat and Jammu were lined up to

invest in Hindustan Coca-Cola Holding Kandhari has already invested Rs 300 mn

in 1999 and 2000 to upgrade its capacity The total investment by all the four

was expected to be Rs 1000 mn Both Coca-Cola and PepsiCo planned for the

launch of lemon-flavored versions of their products Both have been expanding

their non-carbonated drink line-ups as consumers seem to be shifting away from

carbonated soft drinks PepsiCo is deliberating whether to come out with Pepsi

Twist a cola mixed with lemon But while both companies have juice sports

drinks bottled water and other such drinks in their line-ups neither coke nor Pepsi

has launched a new national variety of a cola-flavoured carbonated soft drink in

years

PepsiCo had achieved Rs 3 bn worth of exports which include processed foods

basmati rice guar gum and soft drinks concentrate PepsiCo completed the second

phase of its expansion and with this expansion PepsiCo was to explore the

possibility of expanding the export of concentrates to more countries in addition to

the exports to Russia and other South Asian countries

Pepsi India has entered into a marketing tie up with Hindustan Lever to promote

sales of soft drinks through Pepsi-HLL network of vending machines and

fountains The major soft drink brand in the Pepsi stable are Pepsi 7UP Mirinda

Tropicana and Acquafina

As a major strategic departure both MNCs were expanding their brand range

Consequent to some diversifying moves at present the sales ratio of Coca-Cola

between soft drinks and other beverages is 955 The company intended to change

this to 8020 in the next three years Its juice brand Maaza - acquired from Parle a

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 12: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

few years ago - is being given a major thrust It has plans to go in for canned

coffee iced tea and purified categories under expansion schemes It has already

launched its bottled water brand Kinley in the Indian market Besides it is

intending to acquire domestic brands in the non-carbonated beverages segment

The global deal between Coca-Cola and PampG to form a snacks and beverages joint

venture company was reported to have slipped into rough weather The

PampG brand of potato wafer Pringles seemed to be faced with distribution

problems in India PampG had globally tied up with Coca-Cola to form a stand-alone

juice and snacks company The new firm is focused on developing and marketing

new juices juice based beverages and snacks on a global basis The Sharjah-based

Allied Beverages was pushing its Ahlan brand in India having entered the market

in mid-2000 Its target was carbonated drinks market in PET bottles Its plans

were to launch a PET bottle in the popular 300 ml category Ahlan expected to

gain a 12 share of the total PET bottle market in northern India Of the total

market PET bottle segment is approximately 12 Presently Allied Beverages

has a manufacturing unit at Dharuhera in Haryana The product range includes

carbonated drinks - cola orange lemon and soda in three pack sizes - 500 ml

1500 ml and 2000 ml Allied Beverages sells non-carbonated drinks in 200 ml

foodgrade cups priced at Rs 7 in its portfolio available in four different flavors

The companys future plans include pulp-based fruit drinks in flavors which will

be available in 200 ml non-returnable glass bottles

IFB Agro Industries has handed over the distribution rights of Cadbury Schweppes

in favour of Coco-Cola India following the global takeover of Schweppes

beverages by Coke The company still retains the bottling rights for the beverages

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 13: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

It was noticed for the first time during the summer of 2004 that soft drink

companies were registering a slower growth in the sale of bottled water at 20

compared to 35 in case of drinks

Lead Players amp Alliances

Company Share ()

Aradhana 34

Varun Beverages 15

Devyani Beverages 9

Kandhari Beverages 7

Ludhiana Beverages 7

Sri Sarvarya Sugars 6

Pearl Drinks 5

Pearl Beverages 6

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 14: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Leading Brands

Coca Cola Thums Up Limca Fanta Gold Spot Rim Zim Maaza Pepsi Mirinda

7UP Mangola Slice Dukes Lemonada Crush Canada Dry Campa

Market Growth Rates

1990-91 - 1996-97 941996-97 - 2001-02 782001-02 - 2006-07 652004-05 - 2009-10 542009-10 - 2014-15 35 Sensitivity Coefficient 52Market Segmentation

Segment Share ()North 24East 18West 32South 26Rural 30Urban 70

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 15: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Market Structure

Product Variation

Company Share ()Cola Drinks Thums Up 29Coca Cola 25Pepsi 18Non Cola Drinks Gold Spot 2Fanta 9Mirinda 8Limca 9Overall Colas 62Lemon Cloudy 7Clear 3Orange 17Mango 3Soda 8

(wwwmofpinicin)

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 16: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Robust growth continues

The soft drinks industry continued on its path to recovery from the low growth seen between 2005 and 2006 with higher volume growth in 2008 than that seen in 2007 The mature sectors of bottled water fruitvegetable juice and carbonates saw a dynamic year with companies refreshing their productsrsquo brand image and packaging to attract new consumers Emerging product categories such as energy drinks and reconstituted 100 juice saw high double-digit growth rates as companies increased their productsrsquo penetration in India Off-trade volume growth was slightly higher than on-trade volume growth as convenient on-the-go packaging company sponsored chillers in kiranas and attractive supermarket displays fuelled off-trade sales across the market

Companies reposition their brands and update product portfolios

With the industry back on the upward growth curve companies refreshed their brands by introducing new and more premium packaging designs pack sizes and communication campaigns In 2008 bottled water was especially dynamic with all the major national brands following the cue of Bislerirsquos rebranding in late 2007 Carbonates and juice drinks were also reinvigorated with new pack sizes that targeted on-the-go consumption by young adults With ldquonaturally healthyrdquo becoming a key focus for consumers and manufacturers fruitvegetable drinks companies focused their efforts on highlighting their productsrsquo fresh fruit content and health attributes Companies put in motion plans to extend their product portfolios to emerging categories such as 100 juice energy drinks and flavoured water

Indian Product Range

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 17: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Flavour Ingredients Pack Product Company

Cola Cola Flavour carbonated water sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Coke

Thumsup

RC

Pepsi

Coca-Coal

RC cola

Pepsi

Orange Orange Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Fanta

Mirinda

Coca-Cola

Pepsi

Fruit Juice Mango Pulp+ Treated water+ sugar

250 ML Maaza

Minute Maid Pullpy Orange

Slice

Tropicana

Appy Fizz

Real

Coca-Cola

Pepsi

Appy FizzDabur

Cloudy Lemon

Lemon Flavour + Carbonated Water+ Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Limca

LMN

Mirinda Lemon

Nimbooz

Coca-Cola

Parle agro

Pepsi

Clear Lemon Lemon Flavour+ Carbonated Water + Sugar

200Ml

300Ml

500Ml

1 Litre

15 Litre

2 Litre

Sprite

7rsquoUp

Dew

Coca-Cola

Pepsi

Rural Market Scenario

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 18: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Indian Rural Market

The Indian growth story is now spreading itself to Indias hinterlands Rural India home to about two-thirds of the countryrsquos 1 billion population is not just witnessing an increase in its income but also in consumption and production The interim Budgets focus on extending the National Rural Employment Guarantee Act (NREGA) to all states with a US$ 583 billion outlay for 2009-10 would benefit the rural economy The rural economy got a further boost with the farmer loan waiver of US$ 1386 billion and the ambitious Bharat Nirman Programme with an outlay of US$ 3484 billion for improving rural infrastructure Additionally the rural economy has not been impacted by the global economic slowdown according to a recent study by the Rural Marketing Association of India (RMAI) The study found that the rural and small town economy which accounts for 60 per cent of Indiarsquos income has remained insulated from the economic slowdown Moreover rural incomes are on the rise driven largely due to continuous growth in agriculture for four consecutive years According to a McKinsey survey conducted in 2007 the rural India market would grow almost four times from its existing size in 2007 which was estimated at US$ 577 billion Furthermore high-end brands like Tommy Hilfiger are also bullish on small towns Small towns currently contribute around 20 per cent of the brandrsquos sales This could go up to one-third in two yearsrsquo time

lsquoRuralrsquo ndash 75 population engaged in agriculture related activity According to industry estimates 70 of population engaged in agricultural

activity1048699 700 million people (Aug 2002)1048699 13rd of countryrsquos GNP1048699 450 districts 630000 villages approx

Rural India is also characterized by growing affluenceagricultural output increasingly to early 215 millions tones in 2004 compared to 176 millions in 1991

Key to success in Rural India

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 19: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Physical Distribution Channel Management Promotion and Marketing Communication

Rural Marketing Key Strategy

Three As

Availability Capacity expansion ndash 25 prod lines and doubled bottle capacity Unique and different distribution strategy ndash hub amp spoke

distribution Coverage of 158342 villages by Aug 2003 (81383 in 2001) 200000 refrigerators to rural retailers

Affordability Introduction of 200ml bottle Priced at Rs 7 closed the gap

between Coke and basic refreshments

Acceptability Mass media marketing Launched TVCs targeted at rural consumers

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 20: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 21: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

LITERATURE REVIEW

1-A study of factors responsible for brand preference in fmcg sectorrdquo The purpose of this paper is the study of factors responsible for brand preference in fmcg products increasing competition more due to globalization is motivating many companies to base their strategies almost entirely on building brands Brand preference means to compare the different brands and opt for the most preferred brand This brand preference is influenced by various factorsAccording to this study many factors were find out for preferring a brand likeBrand persona Brand constancyBrand loftinessBrand valueIn the identification of factors affecting the brand preference it was concluded that brand persona is the most effective factor that affects the brand preference This brand persona deals with the personality aspects or the external attributes of brand thus it can be said that consumer prefer any brand by looking at the external attributes of a brand

-journal of ims vol 5 no1 jan-june 2008

2-Colour and flavour rule consumer preferences Study

The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse ldquoCompanies need to continuously innovate to maintain market leadershiprdquo wrote the researchers ldquoWhen the market is overloaded the challenge consists in creating innovative products able to attract and satisfy consumersrdquo ldquoThis experiment

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 22: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

showed the feasibility of the proposed multi-sensory design method based on mixed qualitative and quantitative approachesrdquo The study also demonstrates the importance of flavour and colour selection for new products

The global flavours market was been valued at some US$18bn in 2006 (Business Insights) Meanwhile the value of the international colourings market was estimated at around $115bn in 2007 (euro731m) up 25 per cent from $107bn (680m) in 2004 according to Leatherhead Food International (LFI) Natural colours now make up 31 per cent of the colourings market compared with 40 per cent for synthetics according to LFI

Bombarding the senses

By choosing to formulate a new beverage the researchers noted that the new product would need to be differentiated by improving the sensory characteristics

Four factors were identified for the formulation four colour intensities) three flavourings two label types (soft versus hard) and two pack sizes (standard versus oversize) By using both quantitative (hedonic testing) and qualitative (focus groups) approaches the researchers found that ldquothe main factors which drive consumer preference for this concept are colour intensity and flavouringrdquo Indeed colour intensity accounted for 43 per cent and flavour 32 per cent of the consumersrsquo overall liking ldquoPack size and label type are taken into account by the consumer to a lesser extendrdquo they added ldquoThis methodology of a qualitative screening associated to a conjoint analysis on relevant sensory attributes has shown good performances to fit consumersrsquo expectation it has now to be reproduced as every brand concept and product is a unique combination designed for a specific consumer grouprdquo concluded the researchers

Source Food Quality and PreferenceVolume 19 Issue 8 Pages 719-726By Stephen Daniells 07-Oct-2008

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 23: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

3- Taste or health A study on consumer acceptance of cola drinks

This study examined the relative contributions of taste and health considerations on consumer liking and purchase intent of cola drinks Eight types of commercial cola drinks were evaluated by 305 adult consumers who also completed a brief questionnaire on food habits Data were analyzed using factor analysis Results revealed that purchase intent of cola drinks was strongly related to degree of liking and to several key sensory attributes including saltiness drinks flavor and greasiness These variables emerged as the first factor in the analysis suggesting that consumers perceive these characteristics as being most important in their choice of cola drinks Factor 2 described a health dimension and was related to respondents attitudes toward fat in the diet Factor 3 comprised two remaining sensory attributes (color and crunchiness) which apparently were of minor importance to the respondents These data suggest that in spite of current concern about reducing dietary fat health remains secondary to taste in the selection of cola drinks for consumers in this population

Source-Beverly J Tepper and Amy C Trail Journal of Food Science and Technology 15 September 1998

Rural Consumer BehaviorConsumer Buyer Behavior refers to the buying behavior of final consumers ndash individuals and households who buy goods and services for personal consumption All of these final consumers combined make up the consumer market The consumer market in this case is Rural India About 70 of Indias population lives in rural areas There are more than 600000 villages in the country as against about 300 cities and 4600 towns Consumers in this huge segment have displayed vast differences in their purchase decisions and the product use Villagers react differently to different products colors sizes etc in different parts of India Thus utmost care in terms of understanding consumer psyche needs to be taken while marketing products to rural India Thus it is important to study the thought process that goes into making a purchase decision so that marketers can reach this huge untapped segment

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 24: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are

1 Environmental of the consumer - The environment or the Surroundings within which the consumer lives has a very strong Influence on the buyer behavior egs Electrification water Supply affects demand for durables

2 Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer For instance villages in South India accept technology quicker than in other parts of India Thus HMT sells more winding watches in the north while they sell more quartz watches down south

3 Influence of occupation ndash The land owners and service clan buy More of Category II and Category III durables than agricultural Laborersfarmers

4 Place of purchase (60 prefer HAATS due to better quality Variety amp price) Companies need to assess the influence of retailers on both consumers at village shops and at haats

5 Creative use of product ex Godrej hair dye being used as a paint to color horns of oxen Washing machine being used for churning lassi The study of product end provides indicators to the company on the need for education and also for new product ideas

6 Brand preference and loyalty (80 of sale is branded items in 16 product categories)

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 25: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Cultural factors influencing consumer behavior

Cultural factors exert the broadest and deepest influence on consumer Behavior The marketer needs to understand the role played by the Buyerrsquos culture Culture is the most basic element that shapes a Personrsquos wants and behavior In India there are so many different cultures which only goes on to make the marketers job tougher Some of the few cultural factors that influence buyer behavior are

1 Product (color size design shape) There are many examplesthat support this point For example the Tata Sumo which was launched in rural India in a white color was not well accepted But however when the same Sumo was re-launched as Spacious (a different name) and in a bright yellow color with a larger seating capacity and ability to transport good the acceptance was higher Another good example would be Philips audio systems Urban India looks at technology with the viewpoint of lsquothe smaller the betterrsquo However in rural India the viewpoint is totally opposite That is the main reason for the large acceptance of big audio systems Thus Philips makes audio systems which are big in size and get accepted in rural India by their sheer size

2 Social practices There are so many different cultures and each culture exhibits different social practices For example in a few villages they have common bath areasVillagers used to buy one Lifebuoy cake and cut it into smaller bars This helped lifebuoy to introduce smaller 75-gram soap bars which could be used individually

3 Decision-making by male head The male in Indian culture has always been given the designation of key decision maker For example the Mukhiyarsquos opinion (Head of the village) in most cases is shared with the rest of the village Even in a house the male head is the final decision maker In rural areas this trend isvery prominent

4 Changes in saving and investment patterns From gold land totractors VCRrsquos LCVrsquos

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 26: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Rural Branding

It is the process of creating and disseminating the brand name so that it is instantly

understood by the customer It is different from branding in rural areas as there

people donrsquot understand English names of brands They rather associate the

product with the picture on the package Eg ldquoLaal sabun or red soap for lifebuoyrdquo

Creating an Identity ndash under this process an identity is created in the minds of the

customer Eg lsquoTATA Namak ndash Desh Ka Namakrsquo here what TATA has done is

they have given the salt a national image They have associated it with the country

and as a result rural consumers tend to connect with it and trust it more amp they also

remember it well Enhance Recognition ndash The brand should be recognizable to the

consumer and create top of the mind (TOM) consumer recall Eg Fevicol

lsquomajboot jodrsquo Building a brand Image ndash The brand should have a personality of its

own Eg Mahindra amp Mahindra has built its brand image in the tractor sector

Bhumiputra series of tractors Sarpanch series have done very well in the rural

areas Brand name has connected well with villagers

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 27: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

RESEARCH DESIGN

A research design is a framework or blueprint for conducting the marketing

research project It specifies the details of the procedures necessary for obtaining

the information needed to structure andor solve marketing research problem

On the basis of fundamental objectives of the research we can classify research

design into two general types

CONCLUSIVE RESEARCH

Conclusive research is designed to assist the decision maker in determining

evaluating and selecting the best course of action to take in a given situation

Conclusive research can be further divided into two types-

Descriptive

Experimental

The research design used in this project is a DESCRIPTIVE DESIGN

Descriptive study as the name implies is designed to describe something-for

example the characteristics of users of a given product the degree to which the

product use the varies with income age etc

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 28: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

SOURCES OF DATA COLLECTION

Research will be based on only one source ie Secondary data

SECONDARY DATA

Secondary data will consist of different literatures like books which are published

articles internet and websites

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 29: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Findings

Following are the findings taken into consideration after the completing this

research study

An important finding that emerged out of the study was that 57of people like to have soft drinks while 43 go for juices (Economics Times 17th

march2009) Through the research it was conveyed that weekly consumption of soft

drinks is higher than the weekly consumption of juices

A majority of Indian consumers consume soft drinks and fruit juices at the

time of parties amp celebrations

Most of the consumers in rural India consume soft drinks because of its taste

and price

Most of the consumers consume fruit juices because it is healthy

As it is seen that canned Juices enjoys the largest market share though they

do contain some preservatives but majority of the consumers consider it

healthy

Most of the respondents (77) were of the strong view that advertisements

affect their purchases and the rest (23) were not at all affected by the

advertisements(httpwwwfoodindustryindiacom)

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 30: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

SUGGESTIONS

With the changing lifestyle people have started becoming more health

conscious Therefore the company should use more appropriate marketing

techniques to promote their fruit juice products like Mazza Minute maid

pulpy orange Slice Tropicana etc so that they can grab more market share

The study shows that partiescelebrations are the places where these drinks

are consumed mostly The companyrsquos must try to increase the sales by

creating and focusing on more utilities so that their product is used more

frequently

As it is seen that people consider canned juices to be healthy with

preservatives This shows that awareness level of the people is low and

needs to be corrected Therefore various methods like campaigns by

government help by media etc can be taken to change this

It has been observed that people prefer to have canned soft drink for

showing their styles but the price is slightly out of their reach (In rural

market) therefore it is suggested to the companies to reduce the price of

canned soft drink up to affordable level which is identified Rs 15

Companies should also use time to time some more and new attractive system of word of mouth advertisement to keep alive the general awareness in the rural market as a whole

Kids constitute the second largest segment of the soft drink market So more amp more fun based advertisement for the brands should be necessary Some life style based advertisement is also necessary

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 31: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Conclusion

India is a primarily a rural country where more than 72 people resides in rural area where main occupation is agriculture Which is the bottom of the Indian economic system Earlier Indian farmers where known for their poorness and resurceless but now a days when government has their prime focuses in rural area backed by the huge planed expenditure to improve the rural economy of the country In the last 50 year Indian farmers has improved a lot their life style expenditure pattern income level taste and preferences has seen a sea change Many urban enmities are now a dayrsquos present in the rural area We can easily find the goods and services that were earlier present only in urban vicinity

Today economy is conformed to two major and far-reaching change from domestic to global and a change from the global to rural economy Both these changes are evolutionary Corporate sector has already realized the vast opportunity existing in the rural sector and are trying to harness these strategies specially aimed at rural markets

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008
Page 32: Changing mindsets in Consumption Pattern of SOFT DRINK in Rural Market

0

Bibliography

wwwcocacolacom

wwwtheeconomictimescom

wwwmofpinicin

Food Quality and Preference Volume 19

Indian Journal Of Marketing

Journal of ims

wwwfoodindustryindiacom

wwwrediffcom

wwwgooglecom

  • History of the Industry
  • -journal of ims vol 5 no1 jan-june 2008
  • 2-Colour and flavour rule consumer preferences Study
    • The intensity of colour and the flavour are the key drivers behind consumer acceptance of beverages says a new study involving DANONE But packaging and labelling are not as important for winning over consumers according to findings published in the journal Food Quality and Preference The study involved consumers at different stages of development and highlights the importance of adopting a ldquosensory marketing approachrdquo said the researchers from French research organisation Adriant the University of Rennes 1 DANONE RampD and Institute Paul Bocuse
      • Source Food Quality and Preference Volume 19 Issue 8 Pages 719-726 By Stephen Daniells 07-Oct-2008