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ARESEARCH REPORT
ON
A Study on Consumer Perception as the Pre-Purchase Behavior
towards Personal Care Products in the Markets of Durg and Bhilai.
Submitted in partial fulfillment for the award of the degreeMaster of Business Administration
Chhattisgarh Swami Vivekananda Technical University, Bhilai
Submitted by,K. Ganesh Kumar
MBA 2nd Semester[Session 2010-2011]
Approved ByDr. Sumita Dave
HOD
Guided ByMr. Saket Ranjan Praveer
Sr. Associate ProfessorMBA (SSMV)
Shri Shankaracharya MahavidyalayaJunwani, Bhilai (C.G.) - 490020
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CERTIFICATE
This is to certify that the project A Study On Consumer Perception As The Pre-
Purchase Behavior Towards Personal Care Products In The Markets Of Durg And
Bhilai. submitted to Shri Shankaracharya Mahavidyalaya, Bhilai in partial fulfillment of
the requirement for the award of Master of Business Administration (MBA) is an original
work carried out by Mr. K. Ganesh Kumar a student of MBA II Sem, under my
supervision and guidance.
Place: Durg Saket Ranjan Praveer Date: Sr. Associate Professor
SSMV, Bhilai
Shri Shankaracharya MahavidyalayaJunwani, Bhilai (C.G.) 490020
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DECLARATION
I, K. Ganesh Kumar, a student of MBA II Semester 2010, at Shri Shankaracharya
Mahavidyalaya hereby declare that this Project Report under the title A Study on
consumer perception as the Pre-purchase behavior towards personal care
products in the markets of Durg and Bhilai. is the record of my original work under
the guidance ofMr. Saket Ranjan Praveer. This report has never been submitted to
anywhere else for award of any degree/diploma.
Place: Bhilai K. Ganesh Kumar
Date: MBA II Semester
3
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ACKNOWLEDGEMENT
No great task can be completed successfully without suitable functional
environment and proper guidance of the eminent personalities on the subject. I am
really indebted to my teacher of Management Department Mr. Saket Ranjan Praveer
(Faculty & research guide), under whose guidance we learnt various subjects of
Management and reach the stage of preparing this research report. I also convey my
sincere gratitude to other faculty members of SSMV for their kind support. I extend my
warm and sincere thanks to respondents of Durg, who have given their precious time to
fill the questionnaire which helped me to reach the conclusions. I feel proud to prepare
this research report under the able guidance of all eminent and renowned personalities
who provide their valuable guidance during the preparation of this research report. I
hope it will prove to be an important study on the consumers preferences towards the
FMCG sector.
Place: Bhilai K. Ganesh Kumar
Date: Enrollment No. AG8490
MBA II Semester
4
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TABLE OF CONTENTS
i. CERTIFICATE
ii. DECLARATION
iii. ACKNOWLEDGEMENT
iv. TABLE OF CONTENTS
1. INTRODUCTION
2. LITERATURE REVIEW
3. RESEARCH METHODOLOGY
4. DATA ANALYSIS AND RESULTS
5. INTERPRETATION OF FINDINGS
6. RECOMMENDATIONS
7. LIMITATIONS
8. CONCLUSION
vi. REFERENCES
vii. APPENDIXES
Employee
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CHAPTER 1:-INTRODUCTION
The Indian personal care industry is estimated at Rs 170 billion. The industry is
divided into fabric wash, personal wash, hair care, oral cares, skin care, colored cosmetics,
mens toiletries and fragrances. Most segments of this industry are going through a decline
in 2002 with several leading players reporting lower sales in 2002 due to lower volumes as
well as lower realization. The next phase of growth has to come from the rural market as
the urban markets are near saturation levels in terms of penetration. The industry has a low
entry barrier and competition is severe. Besides the large multinational players, there are
some leading domestic players as well as the huge unorganized players. Though most of
the market share is with the larger players, companies vie for the marginal market share.
Cheaper imports and duplicate products are also affecting the major players. Companies
have been adopting promotion schemes to dole out freebies and repackaging products in
smaller packages to cater to a wider consumer base are some recent trends. The way
ahead for the personal care companies is to introduce new and better product, improve
penetration, and make the consumer trade up in price and quality. Rural marketing will be a
major thrust area for all companies.
This study is been done to analyze the major factors which emphasis the consumers
while purchasing personal care products, The current survey aims to combine information
from the literature on the consumer perception, fate and effects of factors on intention of
consumers while purchasing personal care products.
Here is an attempt to know the perception of consumers towards personal care
products in Durg and Bhilai. In this research I have tried to find out the impact of various
factors on the purchase intention of the consumers.
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Contributions of this study
The purpose of this report is to provide a background understanding of what factors
are considered by the consumers to know the perception towards personal care product.
To prepare the report, an extensive literature based on factors of consumers perception
towards personal care product has been done.
With the help of this research i have tried to find out the significant impact of some
factors such as Price, Quality, Convenience and Brand on the purchase intention of
consumers while purchasing personal care product. In this research as per the time
limitation I have done the work in following steps
1. I have identified some general factors which affects the purchase intention of
consumers while purchasing personal care product.
2. According to these factors I have made questionnaire and done the survey in the
market of Bhilai and Durg.
3. There was a problem of time limitation so I have done the survey with the sample
size of 100 respondents.
4. For the analysis of data I used Factor Analysis and Regression. After the analysis of
the data I found that price, quality, Convenience, brand is the major factor which
significantly affects the purchase intention of consumers while purchasing personal
care products.
Analysis of the results of the research should go significantly beyond simple graphs,
tables, and analysis of variance. The goal is to identify characteristics of buyers
satisfaction level regarding various features that can be helpful in differentiating among
groups of consumers with different beliefs, feelings, intentions, and buying behaviours,
especially regarding personal care product.
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INDUSTRY PROFILE
India is one of the largest emerging markets, with a population of over one billion.
The Indian personal care industry is estimated at Rs 170 billion. The industry is divided into
fabric wash, personal wash, hair care, oral cares, skin care, colored cosmetics, mens
toiletries and fragrances. India is fourth largest economics in the world in terms of
purchasing power and has a strong middle class base of 300 million. Around 70% of total
households in India reside in the rural areas. The total number of rural households is
expected to rise from 135 million in 2001-02 to 153 million in 2009-10. This presents thelargest potential market in the world. The annual size of the rural FMCG market was
estimated at around us$ 10.5 billion in 2001-02. With growing incomes at both the rural and
the urban level, the market potential is expected to expand further.
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CHAPTER 2:-LITERATURE REVIEW
A literature review is a body of text that aims to review the critical points of
current knowledge and ormethodological approaches on a particular topic. Literature
reviews are secondary sources, and as such, do not report any new or original
experimental work. Most often associated with academic-oriented literature, such as
thesis, a literature review usually precedes a research proposal and results section.
Its ultimate goal is to bring the reader up to date with current literature on a topic and
forms the basis for another goal, such as future research that may be needed in the
area. A well-structured literature review is characterized by a logical flow of ideas;
current and relevant references with consistent, appropriate referencing style; proper
use of terminology; and an unbiased and comprehensive view of the previous
research on the topic.
Perception
Perception is a process by which individuals organize and interpret their
sensory perceives in order to give meaning to their environment. However, what one
perceives can be substantially different from objective reality. There need be, but
there is often, disagreement. For example, its possible that all employees in a firm
may view it as great place to work favorable working conditions, interesting job
alignments, good pay, excellent benefits, an understanding and responsible
management but, as most of us known, its very unusual to find such agreement.
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http://en.wikipedia.org/wiki/Methodologicalhttp://en.wikipedia.org/wiki/Secondary_sourceshttp://en.wikipedia.org/wiki/Theseshttp://en.wikipedia.org/wiki/Logicalhttp://en.wikipedia.org/wiki/Citationhttp://en.wikipedia.org/wiki/Terminologyhttp://en.wikipedia.org/wiki/Secondary_sourceshttp://en.wikipedia.org/wiki/Theseshttp://en.wikipedia.org/wiki/Logicalhttp://en.wikipedia.org/wiki/Citationhttp://en.wikipedia.org/wiki/Terminologyhttp://en.wikipedia.org/wiki/Methodological -
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Pre-Purchase decision
Pre-purchase behavior data is essential in understanding what buyers are
looking for and what in-person experiential marketing and merchandising tactics will
best inform and satisfy these decision-makers. Whether at a tradeshow, in a store, or
at other offline venues, more focus and attention must be paid to capturing data that
exposes customer behavior -- which products they looked at, which features they
spent time examining, what problems they are trying to solve.
Studies have shown that in the absence of comprehensible information,
customers determine their own baseline decision criteria for comparing products.
Whereas a manufacturer may have designed a product to include features relating to
performance, for example, a customer may overlook these features and focus on
form factor, or price -- unless these features, advantages, and benefits are exposed
to the customer in an articulate and effective manner. The purchase decision is a
critical milestone for everyone involved in the sales process. But learning about pre-
purchase behavior is equally important. Answering the question "Why did the
customer buy this product?" will eliminate guesswork, and will lead to long-term
successful customer relationships.
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Impact of various variables on purchase intention
Price
Price is the one element of marketing mix that produces revenue; the other
elements produce costs. Prices are perhaps the easiest element of the marketing
program to adjust; product features, channels, and even promotion take more time.
Price also communicates to the market the ongoing companys intended value
positioning of its product or brand. A well-designed and marketed product can
command a price premium and reap big profits. (Kotler & Keller, 2003, page 431).
Saxena Rajan (page-321) explains that to manufacture, price represents the
quality of money (or goods &services in a barter system) received by the firm or the
seller for its product. Price determines the capability of a customer to buy. Thus price
considered as
Price= (quality of money by the seller)/ (quality of goods & services received
by the seller)
Price impact refers to the correlation between an incoming order (to buy or to
sell) and subsequent price change. J.P. Bouchaud said that a potential powerful way
to assist consumers in making dynamic decision is to disclose price information to
them before they shop (Bouchaud, 2009).
Quality
Quality is a multidimensional concept that cannot be easily defined or
measured, a distinction can be made between objective quality and perceived
quality. Objective quality refers to the actual technical excellence of the product that
can be verified and measured (Monroe & Krishnan 1985). In contrast, perceived
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quality is the consumers judgment about a products overall excellence or superiority
(Zenithal, 1988).
The importance of perceived quality derives from its beneficial impact on
purchase intentions, although contradictory research findings have been reported in
the literature. Some scholars support a positive direct effect of perceived quality on
purchase intentions (Carman 1990; Bounding, satisfaction (Cronin & Taylor 1992;
Sweeney, Souter, & Johnson 1999) and yet others argue that both relationships exist
(Tsiaotso 2006). However, it is of note that the dual effect (direct and indirect) of
perceived product quality on purchase intentions has been found for goods, while the
single effects (direct or indirect) have been reported from studies focused on
services.
In the book Zen and the Art of Motorcycle Maintenance, a cult hero of college
students in an earlier generation literally went crazy trying to figure out the meaning
of quality. Marketers appear to use the word quality as a catchall term for good.
Because of its wide and imprecise usage attribute of quality threatens to become a
meaningless claim (Solomon, 2003, page-306).
Convenience
The consumer usually purchases convenience goods frequently, immediately,
and with a minimum of effort. Examples include tobacco products, soaps, and
newspapers. (Kotler, 12Ed, page-375)
Convenience is anything that is intended to save resources time, energy or
frustration. A convenience store at a petrol station, For example: Sells items that
have nothing to do with gasoline\petrol but it saves the consumer from having to go
to a grocery store.(Wikipedia\ convenience) Impact of convenience according to
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(journal of marketing management) states that there is a great impact of
convenience on purchase intention of consumer.
BRAND
A Name, Term, Sign, Symbol or Design & a Combination of them, intended
to identify the goods or services of one seller or group of sellers from those of
competitors (By American Standard Association)
Kotler, pg 276 had approached that Brand equity is the added value endowed
to product or services. A brand is said to have positive customer-based brand equity
when customer reacts more favorably to a product & the way it is identified as
compared to when it is not.
Branding is an important element in business. Without a brand, customers
have to explain to the sellers in detail about the products that they want, while sellers
may be confused or give the wrong products to the customers. Therefore, it can be
assumed that brand acts as a sign, name or symbol for the products and services.
The main aim of the brand is to identify the products or services of a seller or groups
of sellers and differentiate an offering of a seller from that of its rivals (Kotler).
(Halliday Jess, 29-Jul-2010) Branding and labeling have the most impact on
consumers buying decisions, followed by blind tasting. When a consumer is making
up their mind whether or not to buy a product they are not guided by its taste alone.
A number of extrinsic factors also vie for their attention, such as awareness of the
brand, labeling, price and origin. Kotler (pg 276) approaches brand equity from a
customer based perspective defining it as the differential effect of brand knowledge
on consumer response to the marketing of the brand.
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Hypothesis: -
H1: Price has a significant impact on consumer purchase intention while purchasing
personal care product.
H2: Quality has a significant impact on consumer purchase intention while purchasing
personal care product.
H3: Convenience has a significant impact on consumer purchase intention while
purchasing personal care product.
H4: Brand has a significant impact on consumer purchase intention while purchasing
personal care product.
Research Model and Conceptual framework
Price is taken as independent variable which has significant impact on purchase
intention of customers, as given in literature review J.P. Bouchaud said that a potential
powerful way to assist consumers in making dynamic decision is to disclose price
information to them before they shop.
Quality is taken as another variable which has significant impact on purchase
intention of consumers; the importance of perceived quality derives from its beneficial
impact on purchase intentions.
Convenience is taken as variable which has significant impact on purchase intention
of customers because convenience is anything that is intended to save resources time,
energy or frustration.impact of convenience according to (journal of marketing
management) states that there is a great impact of convenience on purchase intention of
consumer.
Brand is taken as independent variable which has significant impact on purchase
intention of customers (Halliday Jess, 29-Jul-2010) When a consumer is making up their
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mind whether or not to buy a product they are not guided by its taste alone. A number of
extrinsic factors also vie for their attention like brand, labeling and origin.
Figure 1
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CHAPTER 3:-RESEARCH METHODOLOGY
Research Methodology:-
Research Methodology is the way to systematically solve a research problem. In itthe various steps are followed that are generally adopted in the study along with the logic
behind them. It is a conceptual structure with in which the study is conducted. It constitutes
the blue print for the collection, measurement and analysis of data.
Causal research design has been taken to conduct the study. Data collection has
been organized through primary source for which questionnaire containing 7-point likerts
scale has been used. A convenience sampling has been used to collect data. 100
respondents were approached who were the users of personal care products. The samples
collected from the city of Durg and Bhilai.
Research Objectives:-
1. To identify the significant factors of consumer perception as the pre-purchase
behavior.
2. To evaluate the impact of the factors of consumers perception as pre-
purchase behavior.
Research Plan
Research Design Causal
Research Instrument Structured questionnaire
Measurement Scale 7 point Likerts Scales
Sample Plan
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Sampling Design Convenience
Sample Size 100
Sampling unit User of Personal care products
Demographics Age, Gender, Income, Occupation
Sample Location City of Durg and Bhilai
Data Collection:-
Primary Data Collection -
It was collected during the interaction with people through questionnaire and
personal interaction.
Secondary Data Collection -
The data collection was done through literature and information obtained
from various sources to increase the effectiveness of the research. On the other
hand, these are those which have already been passed through the statistical
process .Inputs were obtained from:
o Websites.
o Magazines.
o Books.
o Journals.
Questionnaire Design:-
It translates the information needed into a set of specific questions that the
respondents can and will answer.
CHAPTER 4:-DATA TABULATION AND ANALYSIS
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Factor Analysis:-
Factor analysis attempts to reduce the number of variables and discover the
underline constructs that explain the variance. It extracts the uncorrelated factors that
account for the largest portion of variance from an initial set of variables Correlation matrix
is used to discover the simple pattern in the pattern of relationships among the variable.
With the help of Factor Analysis found that quality and Brand were loaded in the same
column, thus by analyzing the central point of both the variable, Quality (x21, x22, x23) is
found to be lower than Brand i.e. (x41, x42, 43) thus quality has been eliminated from
observed variables and then the regression analysis is done on remaining variables i.e.
Price, convenience, Brand.
Regression Analysis
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Rotated Component Matrix
Component
1 2 3 4
Y1 0.295 0.140 0.900 0.039
Y2 0.246 0.071 0.912 0.007Y3 0.246 -0.028 0.871 0.050
X11 0.133 0.172 0.008 0.907
X12 0.105 0.168 -0.019 0.923
X13 0.149 0.218 0.117 0.855
X21 0.791 0.349 0.180 0.021
X22 0.848 0.254 0.192 0.026
X23 0.843 0.296 0.053 0.025
X31 0.134 0.892 -0.050 0.221X32 0.113 0.898 0.107 0.167
X33 0.088 0.892 0.080 0.176
X41 0.804 -0.090 0.346 0.182
X42 0.828 -0.095 0.304 0.169
X43 0.810 -0.064 0.231 0.298
Extraction Method: Principal Component Analysis.Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 6 iterations.
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Variables Entered/Removed
ModelVariables
EnteredVariables
Removed Method
1 X4, X3, X1a
. Enter a. All requested variables entered.
Model Summary
Model R R SquareAdjustedR Square
Std. Errorof the Estimate
1 0.497 0.247 0.224 1.21099
a. Predictors: (Constant), X4, X3, X1
ANOVA
Model Sum of Squares Df Mean Square F Sig.
RegressionResidualTotal
46.216 3 15.405 10.505 0.000
140.784 96 1.467
187.000 99
a. Predictors: (Constant), X4, X3, X1b. Dependent Variable: Y
Coefficients
Model
UnstandardizedCoefficients
StandardizedCoefficients
t Sig.BStd.
Error Beta
1 (Constant) 2.150 0.569 3.776 0.000X1 0.007 0.100 0.008 0.074 0.941
X3 0.072 0.099 0.070 0.730 0.467
X4 0.424 0.085 0.478 4.977 0.000
a. Dependent Variable: Y
Regression Analysis
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Regression is the determination of a statistical relationship between two or more
variables. In simple regression, we have four variables, three variable (defined as
independent) is the cause of the behavior of another one (defined as dependent
variable).Regression interpret what exists physically i.e., there must be physical way in
which independent variables x4, x3, x1 can be affected by dependent variable Y.
It was found by factor and Regression analysis test that there was one factor which
is significantly responsible for affecting purchase intention f consumers while purchasing
personal care product, that is brand. In the factor analysis test the coefficient value of brand
is 0.000 which is less than 0.05; the brand is a major factor which affects the consumers
perception as pre-purchase behavior towards personal care product.
The coefficient value of price is 0.941, quality is 0.467, which are greater than 0.05;
these four factors dont affects the consumers perception as pre-purchase behavior
towards personal care product.
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CHAPTER 5:-INTERPRETATION OF FINDINGS
1. It was found by factor and Regression analysis test that there was one factor which
significantly responsible for affecting purchase intention of consumers while purchasing
personal care product, that is brand.
2. In the factor analysis test the coefficient value of Brand X4 is 0.000 which is less than
0.05; the Brand X4 is a major factor which affects the consumers perception as pre-
purchase behavior towards personal care product.
3. The coefficient value of Price X1 is 0.941, Quality X2 is 0.467, which are greater than
0.05; these four factors dont affects the consumers perception as pre-purchase
behavior towards personal care product.
4. Coefficient value shows that most of the respondent highly considered brand while
purchasing personal care products.
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CHAPTER 6:-RECOMMENDATIONS
Since, there is a significant difference among the determinants so every determinant
is to be treated differently. As the consumers highly considered the factor Brand while
purchasing personal care product, so Brand will be given highest consideration while
developing market strategies.
The marketers should focus on branding strategies as the consumers consider it
while purchasing.
More of investments need to be made towards building brand.
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CHAPTER 7:-LIMITATIONS
This study is only modest attempt and not be claimed as comprehensive one, further
it is to be pointed that data are inebriation for the study and consequently the findings mode
out of it are reliable to the extent that the respondent have been for the right nourishing the
same.
During conducting this research I come across the following limitation: -
1. The research and survey was limited to only one city of Chhattisgarh.
2. The time available for conducting was not sufficient.
3. Respondents were least interested.
4. Since the sample size taken was very small, the conclusion cannot be generalized.
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CHAPTER 8:-CONCLUSIONS
It can be concluded that Brand has the major significance on the purchase intention
of the consumers.
It can be said that the impact of other factors on consumer purchase intention is low
like Price, Quality, and Convenience.
The consumers, of personal care products are more inclined towards the highly
advertised brands available in the market.
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REFERENCES
Blackwell, R.D.; Mansard, P.W.; Engel, J.F. (2001). Consumer Behaviors (Ninth Edition).
Fort Worth:
Carman JM (1990). Consumer perceptions of service quality: An assessment of the
SERVQUAL dimensions. Journal of Retailing, 66(l), 33-55.
Cronin JJ & Taylor SA (1992). Measuring service quality: a re examination and extension.
En.wikipedia.org\wiki\convenience.
http://marketing-bulletin.massey.ac.nz Marketing Bulletin, 2005, 16, Research Note 4, Page
1 of 10
J.P.Bouchaud, capital fund management March 13, 2009
Kotler Philip & Keller Kevin lane, marketing management 12th Ed. Page-374, 2003
Kotler Philip & Keller Kevin lane, marketing management 12th Ed. Page-431,2003
Loudon, D.; Della Bitta. (1986). A. Consumer Behavior. Concepts and Applications, New
York:
Monroe KB & Krishnan R (1985). The effects of price on subjective product evaluations, in
Perceived Quality J. Jacoby and J. Olson (Eds). Lexington: Lexington Books, 209-232.
McGraw-Hill.
Solomon Michael. R. Consumer behavior 5th ed. (page-306)
Saxena rajan, marketing management 3rd Ed. Page-321
Tsiotsou R (2006). The role of perceived product quality and overall satisfaction on
purchase intentions. International Journal of Consumer Studies, 30 (2), 207-217.
Zeithaml VA (1988). Consumer perceptions of price, quality, and value: A means-end
model and synthesis of evidence. Journal of Marketing 52(July), 2-22.
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APPENDICES
QUESTIONNAIRE
STUDY ON CONSUMER PERCEPTION AS THE PRE-PURCHASE BEHAVIOUR
TOWARDS PERSONAL CARE PRODUCTS IN THE MARKETS OF DURG ANDBHILAI
I am a student of master of business administration at shri shankaracharyamahavidyalaya, Bhilai. As a part of my curriculum, i am conducting a study on CONSUMERPERCEPTION AS THE PRE-PURCHASE BEHAVIOUR TOWARDS PERSONAL CARE
PRODUCTS IN THE MARKETS OF DURG AND BHILAI. The data will be used exclusively foracademic purpose only, without disclosing your identity. I would be grateful to you for yourcandid responses. Please mark a tick () in your preferred box.
StronglyDisagree
Neutra
l
StronglyAgree
1.1 I have an intention to purchase personal care products1
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1.2 I am likely to purchase personal care products1
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1.3 My intention to purchase personal care products is high1
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2.1 I prefer price while purchasing personal care products1
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2.2Price is an important factor for me while purchasing personal care
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2.3 If I get considerable Price I purchase personal care product1
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3.1 I prefer quality while purchasing personal care products1
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3.2Quality is an important factor for me while purchasing personal care
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3.3 If I get good quality I purchase personal care products 11
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4.1 I prefer convenience while purchasing personal care products1
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4.3 If I find good convenience, I purchase Personal care product1
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5.1 I prefer Brand while purchasing Personal care products1
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5.2Brand is an important factor for me while purchasing personal care
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5.3 If I get good Brand I purchase Personal care products 11
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6 Personal Details
6.1 Name /Optional
6.2 Age o 60
6.3 Gender o Male o Female
6.4Annual Income
(Rs. Lakhs)
o 4.5
6.5 Occupation o Studento Business
Person
o Service
Persono Professional o Household
o Other
(Specify)
Thank you for your contribution
K.GANESH KUMAR
MBA-II, Semester
SSMV, Bhilai
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