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Changing Consumer Behaviour in India

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CHANGES IN CONSUMER BEHAVIOUR OF INDIA 1 Executive Summary:- Possibly the most challenging concept in the marketing is to deal with understanding the consumer behaviour. This research paper explains the changes occurred in consumer behaviour of India. The purpose of this research paper is to find out the factors that are affecting the consumer behaviour and what strategies can be formed to adopt those changes and achieve the long term growth and success.

The synthesis of this research paper is based on the secondary data sources as well as the observation of buying behaviour of consumers.

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The attitude of Indian consumers has undergone a major transformation over the last few years. The Indian consumer today wants to lead a life full of luxury and comfort. He wants to live in present and does not believe in savings for the future. An important and recent development in India? s consumerism is the emergence of the rural market for several basic consumer goods.

Consumer behaviour is affected by a lot of variables, ranging from personal motivations, needs, attitudes and values, personality characteristics, socio-economic and cultural background, age, sex, professional status to social influences of various kinds exerted by family, friends, colleagues and society as a whole. We have developed a HSSE model that is: Health, Safety, Sophistication and Environment of Indian consumer. In this research we have found that today? s consumers strictly follow their culture, tradition and values, as a result of which foreign companies were forced to give an Indian touch to them in order to succeed in India.

McDonalds, MTV, Pepsi, Star TV, Coca Cola India and many more had to Indianise themselves to flourish in India. The Indian consumers have shown another major change in their buying behaviour. They just don? t want availability of products; they also want better experience, services and ambience. This has led to the growth of shopping malls where a shopping, entertainment and better facility is all available under one roof. The tastes and preferences of the current generation are changing rapidly. The current generation does not mind paying extra for better facilities and ambience.

One thing is for sure that the pace of change in the needs, desires and wants of the Indian consumers will be even steeper and will further change drastically in the near future. So to achieve sustainable long term success and growth, the marketer will have to understand that how consumers will respond to different product features, price and advertising appeal has a great advantage over its competitors. CHANGES IN CONSUMER BEHAVIOUR OF INDIA 3 Table of content 1 Introduction………………………………………………………………………………………… 2 Literature Review……………………………………………………………………………….. 5,6 3 Objective…………………………………………………………………………………………….. 6 4 Research Methodology………………………………………………………………………… 6 5 Factors Affecting Consumer Behaviour……………………………………………….. 7,8 6 Consumer’s Decision Making Process………………………………………………….. 7 Characteristics of Indian Consumer…………………………………………………….. 9 8 The New Indian Market Structure………………………………………………………. 10,11 9 Findings and Analysis………………………………………………………………………….. 12 ?? Today? s Consumer………………………………………………………………………………. 12,13 ?? Change at a Glance……………………………………………………………………………… 3,14 ?? Change in Marketing Strategies of Companies with Change in Consumer Behaviour of India………………………………………………………………………………………………. 14,15,16 ?? Future Trend in Consumer Behaviour……………………………………………………. 16,17 ?? How to Succeed………………………………………………………………………………….. 17,18 10 Conclusion…………………………………………………………. ………………………………. 8 11 References…………………………………………………………………………………………… 19 CHANGES IN CONSUMER BEHAVIOUR OF INDIA 4 Introduction:- Possibly the most challenging concept in the marketing is to deal with understanding the buyer behaviour. The attitude of Indian consumers has undergone a major transformation over the last few years. The Indian consumer today wants to lead a life full of luxury and comfort. He wants to live in present and does not believe in savings for the future. An important and recent development in India? consumerism is the emergence of the rural market for several basic consumer goods. The Indian middle class has provided a big boost to the consumer culture during the recent past and it is hoped that their buying behaviour will continue to change in the coming future. Due to fast growth of the services sector per capita income of people of India is also increasing. The number of middle class is increasing due to another fact that people are fast shifting from agriculture to the services and industry sector where growth prospects are reasonably high as compared to the agriculture sector which is showing slow growth.

The consumption pattern of a country depends on liberalization of economic policies, buying habits of the younger generation, financial independence at a young age, increase in number of nuclear families and increase in media exposure of the people. The tastes and preferences of the current generation are changing rapidly. The current generation does not mind paying extra for better facilities and ambience. Another major factor that has led to increased consumerism is the growth of credit culture in India.

The Indian consumer does not feel shy to purchase products on credit and pay tomorrow for what they use or buy today. This tendency has led to a tremendous increase in purchase of homes, cars, two-wheelers and consumer goods. The market for luxury products in India is also climbing at an astonishing rate as compared to a decade ago when it was almost negligible. The reason behind this is that the purchasing power of people of India is rising very steeply. The Indian consumer today is highly aware about the product, price, quality and the options available with him.

The purchasing is done by keeping all these factors in mind. Today, price is not the only consideration as it was a few years back when prices played a major role in purchasing. Marketers are trying hard to capture this ever increasing Indian middle class as they form the bulk of Indian consumers. CHANGES IN CONSUMER BEHAVIOUR OF INDIA 5 Literature Review:- Consumer behaviour reflects the totality of consumer? s decisions with respect to the acquisition, consumption and disposition of goods, services, activities and ideas by human decision making units. Hoyer, Macinnis and Pinaki Das Gupta, 2008). Consumer behaviour means more than just how a person buys tangible products such as bath soap, digital music players and automobiles. It also includes consumer? s use of services, activities and ideas such as going to the doctor, visiting a theme park, etc. (Source- Hoyer, Macinnis and Pinaki Das Gupta, 2008) David M Potter (1954) presented the situation of consumers with diverse nature and ambitions. Cyndee Miller (1995) has described the 80 different natures of women as a purchaser in different capacities.

Fitzerald (1994) has described the role of life style in deciding the consumer behaviour factor. The advertising age (1995) has given the reasons for developing different consumer images. Maxine Wilkie (1995) has advocated that Demographic plays a vital role for deciding the culture of consumer. Adweek’s Marketing week (1994) has given the scene of vanishing culture of housewives and replacement by working wives. Howard and Sheth (1969) explained how consumer? s buying behaviour influenced by internal and external factors.

They explained that human mind is „BLACK BOX? which receive stimuli. This stimulus creates perception in the mind of consumer which implied the kind of learning – favourable or unfavourable. This will give the output in the form of acceptance or rejection. Basically this model is based on Stimulus -Response theory. CHANGES IN CONSUMER BEHAVIOUR OF INDIA 6 Objective :- The purpose of this research paper is: ?? To understand the changing behaviour of consumer and develop srategies to adopt those changes to achieve sustainable long term growth and success. ??

To identify the factors affecting the consumer behaviour of India. ?? To identify changes in marketing strategies of marketers due to changes in consumer behaviour of India. ?? To identify the future trends in consumer behaviour. Research Methodology: – The research design selected for this study is descriptive. This research paper explains the changes occurred in consumer behaviour of India. The research work is intends to cover new facts about consumer behaviour and changes in marketing strategies those changes to achieve long term sustainable growth and success.

The synthesis of this research paper is based on the secondary data sources. We have observed some consumers at various players like at shopping Hall, Talkies, Market Street, Beauty Parlours, Hotels, Restaurants, School, College and various social gatherings. In this research we have put an effort to find out which CHANGES IN CONSUMER BEHAVIOUR OF INDIA 7 member of family has the greater influence in the purchase of particular products or services either the husband, or wife or the children or they have equal influence. Factors Affecting Consumer Behaviour:-

Consumer behaviour is affected by a lot of variables, ranging from personal motivations, needs, attitudes and values, personality characteristics, socio-economic and cultural background, age, sex, professional status to social influences of various kinds exerted by family, friends, colleagues and society as a whole. The combinations of these various factors produce a different impact on each one of us as manifested in our different behaviour as consumers. The various factors that affect buying behaviour of in rural India are: 1.

Environment of the consumer – The environment or the surroundings, within which the consumer lives, has a very strong influence on the buyer behaviour, egs. Electrification, water supply affects demand for durables. 2. Geographic influences – The geographic location in which the 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 – The land owners and service clan buy more of Category II and Category III durables than agricultural labourers/farmers. 4. Place of purchase – (60% prefer HAATS due to better quality, variety ; price) Companies need to assess the influence of retailers on both consumers at village shops and at haats. 5. Creative use of product – Example- Godrej hair dye being used as a paint to colour 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.

Cultural factors Influencing Consumer Behaviour:- Cultural factors exert the broadest and deepest influence on consumer behaviour. The marketer needs to understand the role played by the buyer’s culture. Culture is the most basic element that shapes a person? s wants and behaviour. In India, there are so many different CHANGES IN CONSUMER BEHAVIOUR OF INDIA 8 cultures, which only goes on to make the marketer’s job tougher. Some of the few cultural factors that influence buyer behaviour are: 1. Product (colour, size, design, and shape): There are many examples that support this point.

For example, the Tata Sumo, which was launched in rural India in a white colour, was not well accepted. But however, when the same Sumo was re-launched as Spacio (a different name) and in a bright yellow colour, 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 „the smaller the better?. 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 areas. Villagers 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 Mukhiya? 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 is very prominent. 4. Changes in saving and investment patterns: From Gold, Land, to Tractors, VCR? s, LCD TV? s etc. Consumer’s decision making process:- CHANGES IN CONSUMER BEHAVIOUR OF INDIA 9 Chracterstics of Indian Consumers :- HSSE Model of Indian consumer Safety Health Sophistication Consumer Environment Different Segments of Indian Consumer :- ?? The Socialites : Socialites belong to the upper class.

They prefer to shop in specialty stores, go to clubs on weekends, and spend a good amount on luxury goods. They are always looking for something different. They go for high value, exclusive products. Socialites are also very branding conscious and would go only for the best known in the market. ?? The conservatives :- The Conservatives belong to the middle class. The conservative segment is the reflection of the true Indian culture. They are traditional in their outlook, cautious in their approach towards purchase; spend more time with family than in partying and focus more on savings than spending.

Slow in decision making, they seek a lot of information before making any purchase. They look for durability and functionality but at the same time is also image conscious. ?? The working women:-The working woman segment is the one, which has seen a tremendous growth in the late nineties. This segment has opened the floodgates for the Indian retailers. The working woman today has grown out of her long-standing image of being the homemaker. Today, she is rubbing shoulders with men, proving herself to be equally good, if not better. Working women have their own mind in decision to purchase the products that appeal to them.

CHANGES IN CONSUMER BEHAVIOUR OF INDIA 10 ?? Youth segments:- The „rise of generation next? has been written about with unbridled optimism and enthusiasm, based on the coming of age of liberalization children. They are global in their worldwide view and have been exposed to enormous information unlike their parents, raised amidst a consumption-friendly and consumption encouraging social discourse. They are expected to be at the forefront of creating a new, modern, west-embracing consumer society, as well as yield the demographic dividend that will drive economic growth. ??

The New Indian Consumer Market Structure:- There are five types of consumer groups based on what they consume and created a framework: The Rich: – The rich who have most of the luxury goods like cars, PCs, air conditioners and are generally the consumers of premium products. The Consuming Class: – Consumers which have 70 percent of the „utility? durables like two wheeler, refrigerators, washing machines and the bulk of regular FMCGs. The Climbers: – Consumers which have at least one major durable in their homes – either a mixer or a sewing machine or perhaps a television set.

They are main consumer of population segment consumer goods. The Aspirants: – Consumers who are just entering consumption and have the very basics Goods like a watch, a bicycle, a radio, or a table fan. The Destitute: – Consumers who own and consume practically nothing, living as they do from hand to mouth. (Source: S. L. Rao and I. Natrajan, Indian Market Demographic, 1994) CHANGES IN CONSUMER BEHAVIOUR OF INDIA 11 Income distribution of Indian Population in rural and urban areas:- Rural consumer of India:-

Rural Consumers majorly look into the value that the product offers. They associate value with the Benefits that the product offers, its availability, and its Cost. When talking of benefits, they look at the features of the product as well as the Packaging and attractiveness, availability, whether or not the products are available at Retail Shops and Haats, cost, whether or not the product is reasonably priced. Rural Consumer – Occupation, income, Culture, Perception, Attitude Benefits: product features Packaging Availability Retail Shop Haats Cost price

Cite this Changing Consumer Behaviour in India

Changing Consumer Behaviour in India. (2018, May 27). Retrieved from https://graduateway.com/changing-consumer-behaviour-in-india-essay/

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