ISSN: 0974-438X
Imapct factor(SJIF): 5.889

Home | About Us| Invitation For Manuscript| Review Process| Indexing| Subscription | Disclaimer

 

 

PBRI is now indexed in ESCI by THOMSON REUTERS. Pacific Business Review International is included in the UGC List of Recommended Journals (D.O. No. F. 1-1/2016 (PS) Amendment dated 10th January 2017) (S.No. 36785).

 
Editorial Board A Refereed Monthly International Journal of Management
Prof. B. P. Sharma
(Editor in Chief)
Prof. Mahima Birla
(Group Editor)
Dr. Khushbu Agarwal
(Editor)
Ms. Asha Galundia
(Circulation Manager)

 Editorial Team

Dr. Devendra Shrimali
Dr. Dharmesh Motwani
 

A STUDY ON THE PURCHASE BEHAVIOUR OF CUSTOMERS OF HATCHBACK CARS IN DELHI/NCR REGION

By

Ms Vandana Gupta

Assistant Professor

Department of Marketing

 Amity University, Noida

  &

Dr. Asif Ali Syed

Assistant Professor

Department of Business Administration

Aligarh Muslim University

Aligarh

&

Prof. Mukesh Chaturvedi

Sr. Consultant & Founding Partner

PDC Educational Services

Mayur Vihar

Delhi

Abstract

Indian Automobile passenger car market is witnessed by the presence of many national and multi-national manufactures post liberalization 1991. The availability of many alternatives within the city provides an opportunity to the consumers to make a rational decision after considering all the options while purchasing the car. Today is an era which is characterized by a consumer’s market where the manufacturers and marketers not only takes into consideration the consumer orientation to make them satisfy but goes one step ahead of achieving consumer delight. Consumers look for those differentiating parameters, which may help them for best decision and can be proved as value to money proposition for them. It makes more important to analyze the consumer behavior towards the hatchback car owners which will give the feedback pertaining to designing the marketing strategies. The objective of this study is to investigate those differentiating parameter and effect of reference group that influence the consumer buying behavior of car owners within the city of Delhi/NCR. The primary data was collected from 197 respondents, located in Delhi/NCR region using convenience sampling. Various statistical tools and techniques were used for the analysis of the study. The results revealed the strong influence of attributes like price, fuel efficiency on the buying decision of the consumer and importance of reference group.

Keywords: Consumer Behaviour, Customer preferences, hatchback cars, purchase behaviour

Introduction

Today the automobile industry is the growing and profit generating industry. Due to increase in the disposable income of the people and easy finance available in the market, the sales of the passenger cars have increased. As the competition is increasing day by day, new players are entering into the market with their new innovation to attract the potential buyers in the market.

The buying behavior of customer can be studied by knowing their perception about the cars in the market. Basically it is the need to find out what customer expects and what is being offered to them. When a customer is satisfied with the product or service, he recommends that product and service to another prospective customer.

 The Indian industry is currently experiencing unprecedented boom in the demand for all types of vehicle.

Some recent Contributions

The Indian car industry is one of the greatest on the planet with a yearly creation of 23.37 million vehicles in FY 2014-15; the development is more than 8.68 for every penny in the course of the most recent year.

The car business contributes in 7.1 for every penny of the nation's total national output (GDP).

The Two Wheelers portion with 81 for every penny piece of the overall industry is the pioneer of the Indian Automobile market inferable from a developing white collar class and a youthful populace. Also, the developing enthusiasm of the organizations in investigating the provincial markets further helped the development of the part. The general Passenger Vehicle (PV) section has 13 for every penny piece of the pie.

India is likewise an unmistakable auto exporter and has solid fare development desires for the not so distant future. In FY 2014-15, car trades developed by 15 for every penny in the course of the most recent year. Likewise, a few activities by the Government of India and the significant car players in the Indian business sector are relied upon to make India a pioneer in the Two Wheeler (2W) and Four Wheeler (4W) market on the planet by 2020.There was a time when there was too less variety of cars available in Indian market, Indian automobile industry has come up with a long way to have a different variety of cars available these days. There are a many of top automobile companies running their operations in India, which have a different range of products and models available in different segments of cars.

Maruti Suzuki has reliably been the predominant pioneer in the Indian car industry. Nonetheless, there are additionally other enormous players in the market like Tata Motors, Mahindra and Mahindra, Hyundai Motors, Hindustan Motors, General Motors etc.

Earlier, the greater part of the Indian auto car makers was utilizing the remote advances. In any case, now the situation has changed throughout the years and instantly, the Indian car makers are utilizing their own particular innovation and have their own manufacturing units and their own body shops. Because of the developing pace of Indian car advertise, various auto makers including the worldwide pioneers have begun importing products that are created in India for their own nation, because of a few components.

Top Automobile Manufactures in India

  1. Maruti Suzuki Pvt Ltd
  2. Tata Motors Pvt Ltd
  3. Ford India Ltd
  4. Toyota Kirloskar Pvt Ltd
  5. Hyundai Motor India
  6. Honda Motor India Pvt Ltd
  7. Mahindra & Mahindra Ltd
  8. Nissan Motor India Pvt Ltd
  9. Renault India Pvt Ltd
  10. Volkswagen Pvt Ltd

Literature Review

Sangeeta Gupta (2013) reveals that the reference group plays an important role in influencing the car purchase decision. This group which includes family, friends and relatives is a significant source of information and influence. Some of the other factors which influence the purchase decision are promotional offers and fuel efficiency.  As per the study, the three attributes – fuel efficiency, price and powerful engine are considered most important by the customers. With the changing market dynamics, information available on the internet also appears in the list of influencers in the car purchase decision. Vikram Shende (2014) has touched upon various topics such as classification of car market, purchase decision process and classification of behaviors and their effect on various car segments. As highlighted in the paper, consumer behavior is a mix of cultural, demographic, economic, technological and political factors. These factors are a reflection of his knowledge, perception, personality, attitude, lifestyle and motivation. It is imperative that a marketer understands this behavior which is a concoction of multiple factors as mentioned above. Different factors appear at different priority levels for various car segments. Mini Car segment customers are usually first time buyers. Though customer of this segment is highly cost conscious, there is a migration which is observed due to increase in disposable income. The focus changes to safety, driving & seating comfort and brand for the customer of mid-size segment. Three other important attributes for this segment include value for money, features and customer friendly vehicles. Executive and Premium class segment customers have preference for brand name, higher horse power, attractive styling and product performance. The customers of this segment use the vehicle for business purpose and thus look for the brand name to reflect their style and personality. The factors such as price, fuel efficiency and maintenance cost are not of significant importance. Also, global brands are preferred by this customer segment. Stella & Rajeshwari (2012) focuses on the relationship between customer satisfaction, brand image and information from mass media. This study included respondents from all age groups, occupation strata, income groups and education backgrounds. Most customers rely upon inputs from their friends/relatives/children/spouse for decision making. Specifically in nuclear families, decisions are taken individually. The most important factors that influence the consumers are price of the car, low maintenance, high quality and long durability in that order. Consumer retention, customer relationship management, personalization and one-to-one marketing are also important factors in the decision making process.

Kusuma (2015) elaborates on the consumer behavior pattern on buying decision of small cars. A framework has been developed to study the behavioral patterns which influence the consumer purchase of small cars. The need to purchase a car is followed by the information gathering from peers and the internet. Factors such as re-sale value, value for money, market goodwill and easy availability constitute market influence. Car financing agencies also have a role to play in this decision making process. External influence factors include family, parents, colleagues and the car being a status symbol. Manufacturer, Brand, Mileage, Performance, Price, Interior & Exterior Design and Safety & Comfort features consist of the product influence. Internet these days is playing an important role in influencing the pre-purchase decision of cars.

Shahir bhatt and Amola bhatt (2015) identified six factors which influence the purchase behavior of consumers for hatchback cars. Brand promise, Features, Reach, Promotions, Perceived Quality and Price. Brand promise describes the elements which consumer’s associates with a particular brand such as comfort, service and trustworthiness. Quality and the price were separately identified as important factors of the buying process. Beena john and S Pragadeeswaran (2013) states that female car users are buying hatchback cars as it convenient to drive and economical too. Value for money and price quality is the important factors which influence small car buying. The new generation people are very difficult to classify on the basis of demographic factors and unless their thought process and buying behavior preferences are fully understood, decisions on product designs, product variants, branding and distribution channels are likely to be confusing. Gupta Bhuwan and Agarwal Nisha (2013) suggested that if the proper advertisement and sales promotion are done, it helps to create the place in the minds of the customers. With the help of celebrity endorsements, it helps to influence the customers. Manufacturer of car can develop the social Interaction program through which they interact with the customers and there family members, it helps to create loyalty towards the brand. According to today’s scenario car manufacturing are focusing on the family size as nuclear family are increasing day by day, so according toned, want, taste, preference of the customer and design the product . Josephine Stella, Dr. K Rajeswari (2012) states that the most important factor that influences the consumer to buy the car is its price followed by the low maintenance, its high quality and the long durability. People usually look for performance, good dealer network and good after sales service. With the help of study, it was identified that there is a significant relationship between income of the customer and brand name.  Balakrishnan Menon & Dr.Jagathy Raj V.P (2012) states that, for personal needs, the family wanted a car for functions, social gathering, need to travel long distance on trips and need to upgrade from two-wheeler to four-wheeler. People want good engine performance, safety and security measures; good after sales service are at the top list. Comfort factors, style and look of the car and value for money are at the top requirements.

Amit Sharma (2010) pointed out that when a buyer thinks of purchasing the new car, the average time taken in researching for the product is average 9.8 days and the people who have used the car make up their mind in 7.7 days on an average.  More than half the car buyers in these cities use the internet to read reviews compare specifications and prices of different models and to locate dealerships. More than half the consumers look at video advertisements, sponsored links & animated advertisements of cars.

Liu Dongyan (2012) identified safety as the most important characteristics for them and they take value for money on the second characteristic and driving pleasure is the third factors they keep in mind while purchasing the car. Safety and value for money is the most important factors for them to purchase the car. Chinese consumers take after-sale service and exterior design as the forth most important factors when making the purchase decision. Consumers get information from different channels, car sales staff, Internet, family/friend, word of mouth, car shows etc.

Deloitte (2014) revealed that the first time car buyer, looks to buy a car for his family primarily. The first time buyer has really no comparable reference, it is natural that this buying decision is not influenced by the improvement of fuel efficiency factor. The study details that the first-time buyers use reliability, the dealer services and resale value as filters while making brand choices. However, it was observed that female respondents attached less importance to reliability and dealer ability as compared to the male respondents.

Ashutosh Nigam & Rajiv kaushik (2012) identified that brand equity factors helps to influence the purchase decisions of customers. The study concluded that the brand manager should focus on the customer loyalty, trustworthiness, brand distinction, innovative feature to manage brand equity. It is not only the brand image which influences the customer but dealer image plays a important role in influencing the purchaser.

Kotler and Armstrong (2006) stated that the marketers identify the factors which are important to identify potential buyers and then produce products as per the needs of customers. Each of these factors has a special dimension. For instance, social factors play a very important role in the decision of the buyer’s purchase.

Objectives

  1. To understand the source of information that influences the consumer buying decision for hatchback cars.
  2. To understand the demographic profile of customers for hatchback cars.
  3. To determine the major factor that affects the purchasing behavior of a customer.

Research Methodology

Research Design

The research is Descriptive in nature. The study is done to understand the purchase behavior of consumers towards hatchback cars in Delhi/NCR region. For this purpose, a structured Questionnaire is used and results are interpreted.

Sample Unit: Respondents who owns or are planning to buy a hatchback car.

Sample Area: Delhi and NCR

Research Instrument: Structured Questionnaire

Tools Used: Factor analysis, cross tabulation

Software used for analysis: SPSS

Data Collection

Primary data:

Primary data was collected with the help of structured questionnaire.

Secondary data:

Secondary data was compiled with the help of Articles, Reports, Journals, Magazines, Newspapers and Internet.

Sample Size:

197 respondents is the sample size for the study conducted within Delhi NCR. 

Data Analysis

 

The test used is factor analysis.

 

Table 1 - KMO &Bartlett’s Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy.

.791

Bartlett's Test of Sphericity

Approx. Chi-Square

2641.617

Df

300

Sig.

.000

HYPOTHESIS

H0=the sample is adequate

H1=the sample is inadequate

Since KMO value is greater than 0.6, thus the sample is adequate.

Thus H0 is accepted

 

Table 2 - Total Variance Explained

 

Component

Initial Eigen values

Extraction Sums of Squared Loadings

Rotation Sums of Squared Loadings

Total

% of Variance

Cumulative %

Total

% of Variance

Cumulative %

Total

% of Variance

Cumulative %

1

6.941

27.764

27.764

6.941

27.764

27.764

4.114

16.456

16.456

2

3.127

12.507

40.271

3.127

12.507

40.271

2.996

11.986

28.442

3

2.251

9.004

49.275

2.251

9.004

49.275

2.865

11.460

39.901

4

1.922

7.689

56.964

1.922

7.689

56.964

2.596

10.385

50.286

5

1.407

5.629

62.593

1.407

5.629

62.593

2.311

9.243

59.529

6

1.110

4.441

67.034

1.110

4.441

67.034

1.876

7.505

67.034

7

.996

3.984

71.018

 

 

 

 

 

 

8

.783

3.130

74.149

 

 

 

 

 

 

9

.711

2.844

76.993

 

 

 

 

 

 

10

.700

2.799

79.792

 

 

 

 

 

 

11

.597

2.389

82.181

 

 

 

 

 

 

12

.569

2.277

84.458

 

 

 

 

 

 

13

.534

2.135

86.593

 

 

 

 

 

 

14

.483

1.930

88.523

 

 

 

 

 

 

15

.399

1.598

90.121

 

 

 

 

 

 

16

.396

1.586

91.707

 

 

 

 

 

 

17

.343

1.372

93.079

 

 

 

 

 

 

18

.327

1.308

94.387

 

 

 

 

 

 

19

.281

1.126

95.513

 

 

 

 

 

 

20

.238

.952

96.465

 

 

 

 

 

 

21

.220

.879

97.344

 

 

 

 

 

 

22

.187

.748

98.093

 

 

 

 

 

 

23

.172

.689

98.781

 

 

 

 

 

 

24

.158

.632

99.413

 

 

 

 

 

 

25

.147

.587

100.000

 

 

 

 

 

 

Table 3 - Rotated Component Matrix

 

 

 

                                   Component

1

2

3

4

5

6

Interior

.103

.838

.044

.094

.086

-.068

Exterior

.107

.804

.144

.133

.046

-.090

Technical Specification

.204

.775

.189

.034

.004

.215

Safety Measures

-.013

.710

.251

-.019

.182

.293

Fuel Type

.591

.339

-.107

.164

.337

.222

Price

.776

.112

-.048

.104

.264

.042

Maintainence Cost

.794

.063

-.048

.048

.272

.266

Mileage

.784

.071

-.152

.083

.283

.119

Exchange Offer

.727

.069

.013

.096

-.306

.078

Promotion & Discount

.745

.081

.300

-.104

-.124

-.136

Easy Availability Of Finance

.679

-.005

.230

.379

.022

-.075

Test Drive

.166

.269

.215

.128

.507

-.199

Treatment At Dealers

.096

.110

.707

.004

.471

-.020

Behaviour Of Salesperson

-.059

.111

.795

.023

.128

.123

Infrastructure Of Sales Station

-.049

.265

.751

.250

-.082

.204

Dealership Reputation

.077

.121

.741

.135

-.042

.104

Advertisments

.167

.079

.302

.437

-.012

.368

Brand Name

.110

-.065

.266

.576

.375

.181

Word Of Mouth

.227

-.074

.030

.567

.408

.324

Celebrity Endorsment

.034

.056

.207

.088

.098

.821

Promotion

.237

.164

.142

.386

.026

.676

Service Network

.178

.077

.079

.104

.756

.180

After Sales Service

-.040

.133

-.053

.549

.622

.061

Road Assistance

-.096

.367

-.043

.606

.202

.128

Ease Of Exchange

.259

.091

.180

.761

-.043

.013

Extraction Method: Principal Component Analysis.

 Rotation Method: Varimax with Kaiser Normalization.

a. Rotation converged in 9 iterations.

 

Table 4 - Factors Drawn from Factor Analysis

        1

         2

          3

          4

           5

            6

        V6

        V1

         V13

         V24

          V22

          V20

        V7

        V2

         V14

         V25

          V23

          V21

        V8

        V3

         V15

 

 

 

        V9

        V4

         V16

 

 

 

       V10

 

 

 

 

 

       V11

 

 

 

 

 

 

V1-Interior

V2-Exterior

V3-Technical Specification

V4-Safety Measures

V6-Price

V7-Maintainence Cost

V8-Mileage

V9-Exchange Offer

V10-Promotion & Discounts

V11-Easy Availability of Finance

V13-Treatment at Dealers Outlet

V14-Behaviour of Salesperson

V15-Infrastructure of Sales Station

V16-Dealership Reputation

V20-Celebrity Endorsement

V21-Promotion

V22-Service Network

V23-After Sales Service

V24-Road Assistance

V25-Ease of Exchange

 

Thus the factors withdrawn are:

  1. Cost
  2. Specifications
  3. Responsiveness
  4. Reliability
  5. Value Added Service
  6. Awareness

 

Table 5 - Analysis of Demographic Factors - Age

AGE

RESPONDANT

20-30

80

30-40

69

40-50

36

50-60

4

60 above

8

TOTAL

197

It has been found that the total people of age group 20-30 years are 40% who are owning hatchback cars with them whereas the people with age group of 30-40 are slightly lesser, that is 36% who are having hatchback cars, the people with age group of 40-50 are comparatively less in number that is 18%.

Table 6 - Analysis of Demographic Factors – Occupation

 

OCCUPATION

RESPONDANT

Student

32

Self employed

40

Government employee

17

Private employee

100

Other

8

TOTAL

197

 

 

With the help of above pie chart we get to know that 50% sample are the private employees, 20% people are self employed, followed by students and government employees who are comparatively less in number that is 16% and 10%.

Table 7- Analysis of Demographic Factors – Income (in Rupees)

INCOME

RESPONDANTS

100000-300000

20

300001-500000

68

500001-700000

73

700001-900000

20

900001-1100000

8

Above 1100001

8

TOTAL

197

The above chart states that 38% people are in the income group of 5L-7L per annum and people with the income group of 3L-5L per annum are 34% , followed by 7L-9L and 9L-11L which is comparatively less in number that is 10% for both the groups and people with the income of 1L-3L and above 11L is only 4%.

Table 8 - Analysis - Information Source

Information

Respondents

Friends & Relatives

96

Official Website Of Brand

36

Auto Review Shows

45

Review On The Trading Websites

20

Total

197

From the above pie charts, it was observed we got the information about the source, that from where people get influenced for buying or taking the decision for purchasing the vehicle. So, 48% of the people get influenced from their friends and relatives, 24% people get influenced from the auto review shows, whereas 18% of people get influenced from official website of brand and 10% of people get influenced from the review from the trading websites.

Observations & Findings

 

  • Factors identified from factor Analysis are Cost of the car, Specifications of the car, Responsiveness, Reliability of the company, Value Added Services, Awareness. Thus these are important factors considered by the potential buyers for purchasing of a car.

 

  • From the demographic analysis, the respondents in the age group of 20-30 years are very important for the companies for purchasing of hatchback cars, followed by 30-40 years of age group.

 

  • The people who purchase the hatchback cars are mostly private employee, which is 50% of the sample, followed by self employed people who are comprising 20% of the sample.
  • 38% people are in the income group of 5L-7L per annum and people with the income group of 3L-5L per annum are 34%

 

  • The most important source of information that influences the customer for purchase of the car is friends and relatives, followed by official website of brand.

Recommendations

 

  • Along with the demographic profile of the respondents, it is important to study the psychographic profile of the customers, which helps the companies to understand their mindset, attitude and the emotional connect with the vehicle.

 

  • The factors that have been concluded from the analysis, help us to understand the purchase behavior of the customers, thus the in-depth study of these factor is important for the company in order to understand and satisfy their customer segment. In order to approach other customer segment, these factors may act as the key points to influence the customers.

Conclusion

 

Consumer behavior is very important for before and post purchase choices. One cannot succeed in the aggressive market without understanding the consumer behavior. An understanding of the buyer empowers an advertiser to take promoting choices which are perfect with its customer needs. From the study, there are various major classes of consumer behavior determinants and expectations, namely socioeconomic, demographic, Product and Technology. Further classification of human behaviors under main categories will enable car manufacturer to align their strategies in concurrence to customer behavior. While buying hatchback cars however customer is exceedingly taken is highly cost conscious but this segment is also upgrading their requirements because of increasing disposable income. Customer is more leaned to buy Maruti Suzuki and Hyundai brands. In hatchback segment, the customer also focuses on security, driving and seating comfort, brand.

In mid size segment, like affordability and convenience are the key focal segment. .The reference group plays a vital part in purchasing decision for hatchback cars. Companions, family and relatives reference has been found the main influencers in car purchasing. Additionally, Price-off amongst the special offers and fuel effectiveness in the hatchback cars are observed to be the premier purposes behind the purchase of the vehicle. The study additionally saw the relationship between the respondents age is the main influencer in buying a hatchback car. Furthermore, the companions, family and relatives are the main influencer, customers also trust on the data that is present on internet. All the features or attributes are considered to be vital by the consumers. Among attributes, the three most essential ones are Cost, specification and value added services. Passenger car makers should enhance their item as far as fuel-efficiency and enhance innovation to enhance the mileage in order to attract more customers.

Bibliography

 

  • Josephine Stella & Dr.K.Rajeswari.( 2012) Consumer Behavior towards Passenger     Cars – A study with reference to Virudhunagar District of Tamil Nadu, January -Vol 2 Issue 1.
  • Arpita Srivastava and Mitu Matta (2014). Consumer Behavior towards Passengers Cars -A Study in Delhi NCR, Volume 6
  • Ashutosh Nigam, Rajiv Kaushik (2011) Impact of Brand Equity on Customer Purchase Decisions: An Empirical Investigation with Special Reference to Hatchback Car Owners in Central Haryana, Vol. 12, April.
  • Balakrishnan Menon & Dr. Jagathy Raj V.P (2012). Dominant mean percentage score factors of the consumer purchase behavior of passenger cars, Volume 2, Issue 5 May.
  • Beena John & Dr. S. Pragadeeswaran (2013) a study of small car consumer preference in pune city, Vol.2 Issue 3-4, March-April
  • Deloitte (2014), driving through the consumer’s mind Considerations for Car purchase.
  • Gaedebe R (2007), Consumer Attitude Toward s Cars made in Developing Countries, Journal of Retailing, 49 pp13-24.
  • Gupta Bhuwan & Agarwal Nisha, Consumer Perceptions and Behaviour (2013)A Study with Special Reference to Car Owners in Alwar District (Rajasthan), IJSRR, 2(1) Suppl., 167- 189
  • Gupta ,Sangeeta (2013) A Study of Buying Decision Influencers for Passenger Car Segment in New Delhi, Volume 2 Issue 12, December.
  • Kusum P (2015) A Study on Impact of Consumer Behavior Pattern on Buying Decision of Small Cars in Karnataka, 4, Issue 10, October.
  • Liu, Dongyan & Xuan, Bai (2008), Car Purchasing Behavior in Beijing: An Empirical Investigation, Umea School of Business and Economics, University of Umea, Thesis paper pp. 10-17.
  • Nikhil Monga, Bhuvender Chaudhary, Car Market and buying behavior - A study on Consumer Perception, Vol.2, Issue-2, Feb 2012.
  • Shahir Bhatt and Amola Bhatt (2015) Factors Influencing the Purchase of Hatchback Cars: An Empirical Study in Ahmedabad, aWEshkar Vol. XIX Issue 1 March.
  • Sharma, Amit (2010 ) when mouse helps you in buying car, The Economic Times, p. 14.
  • Vikram shende (2014) Analysis of research in consumer behavior of automobile passenger car customer, Volume 4, Issue 2, February.
  • White, R. (2004), how people buy cars, Admap Journal, Vol. 39 No 3, pp. 41-43.
 
 

Pacific Institute of Management, Pacific Hills, Airport Road, Udaipur - 313001, E-mail: edit@pbr.co.in
Phone : +91-294-2494506, +91-294-2494507

©Pbr.co.in, All Right Reserved IT Department , Pacific Group