BUYING BEHAVIOUR FOR SMALL CARS

INTRODUCTION

These days’ small cars are gaining huge attention by consumers in India. The entry of various small cars in the recent years witnesses the flourishing small car market. Various factors have catalyzed in pushing the segment popularity. The rise in the fuel price is one such reason. As these cars are affordable and fuel efficient, they easily lure the middle class population of the country.

Presently, the market is flooding with small cars like Tata Indica, Maruti Suzuki Alto, Maruti Suzuki Wagon R, Hyundai Santro Xing, Hyundai Santro i10, Chevrolet Spark and more. The small car segment is the most competitive car segment currently in India. The car manufacturers launch new models on regular basis to surpass each other and capture the Indian market.

Tata Motors cheapest car, the Nano, expected to cost Rs 1 lakh has created a sensation the small car industry with its debut in the auto expo 2008. The car is designated as the cheapest car in the world. Many global auto manufacturers are also planning to enter the small car market segments. The coming year will witness a flourishing growth in the small car sectors with the intrusion of auto majors like the Fiat, Ford, General Motors, Honda, Skoda, and Volkswagen.

The car industry at present is in the way of investing over Rs 70,000 crore in India and 65% of which is aimed towards small car production sector.

WHY SMALL CARS ARE PREFERRED IN INDIA?

Two wheeler users or secondhand car users generally opt for small cars as they are affordable.

These cars are much fuel efficient when compared to mid-size or luxury cars. The ever-increasing fuel price has affected the manufacturer as well as buyers. When car manufacturers are trying to attract more customers, the consumers are looking for fuel efficient cars. Small cars being a solution to this crisis getting more attention.

India is famous for congested roads and small lanes, where driving big cars is a hassle. Thus Indian buyers choose small cars for commuting.

Small cars are more compact and can be maintained pretty well when compared to the other segment cars. They are much reliable in terms of life and also resale value.

CONSUMER BUYING BEHAVIOR

"The study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society."

The decision processes and acts of final household consumers associated with evaluating, buying, consuming, and discarding products for personal consumption consider the purchase an automobile. You generally will not consider different options until some event triggers a need, such as a problem needing potentially expensive repair. Once this need has put you "on the market", you begin to ask your friends for recommendations regarding dealerships and car models. After visiting several dealerships, you test drive several models and finally decide on a particular model. After picking up your new car, you have doubts on the way home, wondering if you can afford the monthly payments, but then begin to wonder if instead you should have purchased a more expensive but potentially more reliable model. Over the next five years, the car has several unexpected breakdowns that lead you to want to purchase a different brand, but you have been very happy with the services of the local dealership and decide to again purchase your next car there.

MAJOR SMALL CAR MANUFACTURERS

MARUTI UDYOG LTD.

GENERAL MOTORS INDIA

FORD INDIA LTD.

HINDUSTAN MOTORS

HYUNDAI MOTOR INDIA LTD.

DC DESIGNS

SWARAJ MAZDA LTD

HONDA MOTORS LTD

In this particular case, the following generic model of consumer decision making appears to hold:

=====>need recognition

=====>information search

=====>evaluation of alternatives

=====>purchase decision

=====>post purchase behavior

NEED RECOGNITION

There will come a moment in time that will set off the decision making process.

This will be realization, gradual or immediate, by the potentially interested

consumer that they have some kind of problem or need for a product or service.

The need might be simple and caused by an internal stimuli, eg. Our stomach is

rumbling we are hungry and fancy a hamburger, we have headache and must buy

some pills. Or it might be in response to some external marketing stimulus.

More complex need recognition:

On the other hand the need recognition might be more complex. Perhaps the

existing product, i.e. the cooker is broken or worn out and needs replacing, or

perhaps a newer more modern product is now available in the market. The chill of

the winter might persuade a family for a vacation in the sun, or a special offer from

Chevrolet might conceive them to forgo the holiday this year. Sometimes need

might be more deeply hidden, perhaps within the subconscious, and be more to do

with some sought of status anxiety or self-esteem problem.

An “aroused” customer then needs to decide how much information (if any) is

required. If the need is strong and there is a product or service that meets the need

close to hand, then a purchase decision is likely to be made there and then. If not,

then the process of information search begins.

INFORMATION SEARCH

Sources of collecting information

The usefulness and influence of these sources of information will vary by product

and by customer. Research suggests that customer’s value and respect personal

sources more than commercial sources (the influence of “word of mouth”). The

challenge for the marketing team is to identify which information sources are most

influential in their target markets.

CONSUMER BEHAVIOR: TURNING TO THE WEB AND NEW C2C TOOLS

Consumers today have a multitude of sources from which to gather information

during the vehicle buying process, but the Internet tops the list. The web has

become a standard resource in the shopping process for eight out of 10 consumers

when researching car purchases. However, the way they use it is changing. As the

web matures, vehicle buyers are visiting fewer sites and focusing more on

manufacturer and C2C websites and less on third-party information sites and

independent e-tailer sties.

KEY FACTORS IN VEHICLE CHOICE

When it comes to making their final decision about which vehicle to buy,

consumers focus on factors such as reliability, safety, price and fuel economy. At

the bottom of the list are cash-back incentives, named by fewer than half of

consumers. The importance of incentives as a deciding factor has declined for the

past several years, indicating that consumers today seem less interested in

gimmicks when it comes to their car purchases. Where consumers are in the

buying cycle can make a difference in how they rank the factors that influence

their vehicle choice. For example, additional warranty coverage is important to

consumers who are furthest away from the point of purchase; it was named by 69%

of respondents who were 13 to 18 months from purchase. However, the number

declines as consumers get closer to actually buying the car: 55% of respondents

who were within three months of purchase said extra warranty coverage was

important. This reflects the fact that consumers will narrow down the factors that

really matter to them as they get closer to the point of purchase. Demographic

factors such as age and gender accounted for some variances. For example, older

consumers tend to put more emphasis on reliability and safety than do younger

respondents. Those in the 50-plus age group were also more concerned with

environmental issues and fuel economy. The youngest respondents were most

likely to rate the ability to research information on the Internet as an important

factor in their vehicle decision. Women tend to rate most of the factors as more

important than do men. The difference was most pronounced for cash-back

incentives, low financing, safety, environmental issues, fuel economy and

additional warranty coverage.

FACTORS INFLUENCING BUYER’S BEHAVIOR

Final (or ultimate) consumers purchase for:

1. personal,

2. family, or

3. household use

FACTOR ANALYSIS FOR FACTORS AFFECTING CAR PURCHASING DECISION

Initial Extract S1 1.000 .833S2 1.000 .692S3 1.000 .760S4 1.000 .600S5 1.000 .695S6 1.000 .795S7 1.000 .512S8 1.000 .731S9 1.000 .783S10 1.000 .875S11 1.000 .851S12 1.000 .682S13 1.000 .642S14 1.000 .628S15 1.000 .674S16 1.000 .615S17 1.000 .562S18 1.000 .707S19 1.000 .855S20 1.000 .528S21 1.000 .662S22 1.000 .610S23 1.000 .542S24 1.000 .687S25 1.000 .835S26 1.000 .684S27 1.000 .844S28 1.000 .683S29 1.000 .857S30 1.000 .650

FACTORS CONSIDERED FOR THE PURPOSE OF STUDY

Factor 1: S1 : Price Of The Car S19 : Information Provided By Salesperson S25 :Safety S27 : Easy Availability Of Spare Parts S29 : Technology

Factor 2:

S10 : Government Policies And Regulations S11 : Import Duties Imposed By Government

Factor 3:

S3 : Family Needs S5 : Brand Image S6 : Income Level S8 : Special Family Programs/Events Like Anniversary, Birthday S15 : Insurance Facility S18 : Credit Card Acceptance S26 : Car Accessories

Factor 4: S14 : Installment Payment Facility S16 : Location Of The Car Dealer Shop S24 : Looks S28 : Availability Of Service Station

Factor 5:

S4 : Status Symbol S12 : Advertisements And Promotions S17 : Home Delivery Facility S30 : Overall, I Am Satisfied With My Car I Own

Factor 6:

S2 : You Take Suggestions Of Your Family Members S9 : Family Members & Friend Circle S13 : After Sales Service

Factor 7:

S20 : Availability Of Variety Of Cars Under One Roof S21 : Information Provided By Various Car Related Magazines

Factor 8:

S22 : Mileage S23 : Power

Factor 9:

S7 : Festival Season/Offers

POST PURCHASE EVALUATION

The final stage of decision making process is something known as post purchase

evaluation. It is common for the customers to experience some concerns after

making a purchase depending on Importance and value of the decision.

Satisfaction

After the sale, the buyer will likely feel either satisfied or dissatisfied. If the buyer

believes that s/he received more in the exchange than what was paid, s/he might

feel satisfied. If s/he believes that s/he received less in the exchange than what was

paid, then s/he might feel dissatisfied. Dissatisfied buyers are not likely to return as

customers and are not likely to send friends, relatives, and acquaintances. They are

also more likely to be unhappy or even abusive when the product requires post-sale

servicing, as when an automobile needs warranty maintenance.

Cognitive dissonance

has to do with the doubt that a person has about the wisdom of a recent purchase

It is very common for people to experience some anxiety after the purchase of a

product that is very expensive or that will require a long term commitment

CONCLUSIONS

Since Indian Automobile market is continuously in the prowl of surging as a major

car manufacturer, people are purchasing car as there is increase of income of

common people as well as change in tastes and preferences of consumers. It is

important for the car manufacturers and car dealers to be able to understand the

different factors affecting the extent in car purchasing behaviour. The factor

analysis results indicate that factor 1 which consists of Information provided by

salesperson; safety; easy availability of spare parts; technology are affecting the car

purchasing behavior. People are more conscious about the on spot information

provided about various cars who serves according to the needs and wants of the

customer. The type of technology used and the wider reach of the service stations

also affect the most on car purchasing decision. While government obligations and

various policies like import duties, custom exemptions is seen as second most

affecting driver factor 2, of purchase of cars. Factor 3 includes family needs;

brand image; income level; special family programs/events like Anniversary,

Birthday; insurance facility; credit card acceptance; car accessories affects

customers car purchase decision. This shows that importance of family decisions,

special occasions in family and the various services provided by car dealers. Factor

4, Table 7 includes installment payment facility; location of the car dealer shop;

looks; availability of service station showing customers accessibility to the service

provided. Factor 5 shows the impact of various promotional activities and extra

care taken by car dealers. Factors 6 shows the impact of suggestion provided by

family members and peers as well as price and after sales service provided. Factor

7 includes the infrastructural benefits of the shop and the variety of cars it

stores .The last but not the least ones shows the impact of factors of technical

specifications of the car and the festive season offers

Overall, various internal and external factors like extra care facilities, location of

the shops, various information provided by car dealers, advertisement and print

media promotions, features of the car in all are contributing in making car

purchasing behaviour of customers.

ANNEXURE

Opinion Survey

Section I

Demographic Factors

Name……………………………………………………………Gender…………..

Age

Below18 18-25 26-35 36-50 51 and above

Occupation

Service Business Student Housewife

Section II

According to you which of these Factors are Affecting Car Purchasing Decision in India. Please fill according to instruction in bracket given below

(SA-Strongly Agree; A-Agree; N-Neutral; DA-Disagree; SDA-Strongly Disagree)

Sl.No Statements Strongly Agree

Agree Neutral Disagree Strongly Disagree

1. Price Of The Car

2. You Take Suggestions From Your Family Members

3. Family Needs 4. Status Symbol

5. Brand Name

6. Income Level

7. Festival Season/Offers8. Special Family Programs/Events

Like Anniversary, Birthday

9. Family Members & Friend Circle

10. Government Policies And Regulations

11. Import Duties Imposed By Government

12. Advertisements And Promotions

13. After Sales Service

14. Installment Payment Facility

15. Insurance Facility

16. Location Of The Car Dealer Shop

17. Home Delivery Facility

18. Credit Card Acceptance

19. Information Provided By Salesperson

20. Availability Of Variety Of Cars Under One Roof

21. Information Provided By Various Car Related Magazines

22. Mileage

23. Power

24. Looks

25. Safety

26. Car Accessories

27. Easy Availability Of Spare Parts

28. Availability Of Service Station

29. Technology

30. Overall, I Am Satisfied With My Car I Own

BUYER BEHAVIOR FOR BUYING A LAPTOP

Buying a new laptop can present many challenges, especially if you're unfamiliar

with laptops or notebook computers. The first laptop was created in the year 1982

and today we are in the year 2009, just by seeing the time span we can understand

that so many options will be available to the buyer in the market. Over the last little

while so much new laptop technology has hit the market... Intel Duo Processors,

SLI, Dual Graphics... it can all be totally minded boggling to the average

consumer. For the first time laptop buyer understanding all the techno jargon can

be downright scary. Mainly because a whole new generation of notebook

technology comes around every two years or less - probably much less when you

consider all the new advances made recently.

Regardless of all these fancy new improvements, devices and notebook

technology, one always considers that he / she is buying a new laptop for you and

you alone.

You must first decide if all this new stuff is important to you?

Do you really need all this new notebook technology?

But most of all before one can consider that question you must first figure out

WHY you want a laptop?

Why are you buying a laptop?

What chores or tasks do you want the laptop to perform?

So what do you need the laptop for?

Do you need a lightweight portable laptop for business trips or meetings?

Do you need a student notebook for classes?

Or do just want a desktop replacement computer that you can easily move around

in your home?

There are certain features of a Laptop which the buyer surely considers before

buying a Laptop. These features are:

RAM

Processor System

Hard Drive – Memory Space

Weight

Size

Price

Warranty

Battery Life

Basically there are three key features which affect consumer buyer behavior for

laptop:

Social Features

Personal Features

Psychological Features

Nowadays the Laptop Companies are finding it so much difficult to understand the

Buyer Behaviour that now they have started offering online customization or

designing of Personal Laptop according to the Buyers preference or purpose of

buying e.g. DEL.

These factors clearly depict clear difficult Laptop market conditions for the buyer,

which makes it important to understand it.