Section C

AMR Project

Group 7

Indian Institute of Management, Indore

Project Report Submission

Advanced Marketing Research with SPSS Study of Consumer Preferences at a Food Court

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Abhijeet, Amit, Arijit, Nikhilendra, Nitin, Prabhu, Puneet, Sheenam, Shishir

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AMR Project

Group 7

Group 7, Section C
AbhijeetAmitArijitNikhilendraNitinPrabhuPuneetSheena mShishir Table of Contents
Introduction...........................................................................................................4 Problem Definition.................................................................................................4 Approach to the problem.......................................................................................4 Research Methodology..........................................................................................4 Sampling Design....................................................................................................5 Questionnaire Design............................................................................................6 Data Preparation & Analysis..................................................................................7 Demographics

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List of Tables List of Graphs List of appendices List of exhibits Executive Summary The major findings of this research are that the major factors which influence a consumers decision to eat at a Food Court are ______. Thus the major conclusions which we can draw from this research are _______ Our recommendations based on this research are _________

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Introduction

The intent of this research is to study the consumer preferences and the buying behaviour of the consumers in a food court through the marketing research methodologies

Problem Definition

Background to the problem The presence of Food Courts in malls is a common phenomenon these days. People normally visit a mall to shop and the availability of a food court acts as an added benefit to stick around longer and spend some more time inside the shopping complex. However, it has been observed that though Food Courts act as an added benefit, they are not the primary reason as to why the consumers visit the shopping mall. While consumers may come to shop and eat they might not come to do the vice versa. Primary Research Objective To understand the food consumption behaviour and preferences towards a food court, for a consumer visiting a shopping mall. Secondary Research Objectives
1. To understand the reasons as to why people come to a food court 2. To profile the consumers based on their spending patterns 3. To determine the factors which influence their buying behaviour

Approach to the problem

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We decided to carry out a primary research by interacting with consumers in a mall. This was to get their inputs on certain parameters with respect to their preferences towards eating at a food court.

Research Methodology

The following method was adopted while conducting the research:

1. Exploratory

Research

An

Exploratory

Research

amongst

ourselves and 25 of our batch mates was carried out to identify the probable factors which influence the decision making process of the consumers. The results of the discussion led us to identify the following potential factors which might influence the buying behaviour and preference of consumer towards eating at a food court i. Price ii.Ambience iii.Hygiene iv.Distance from Home / Location v.Service Quality vi.Alternate activities / Proximity for shopping vii.Promotional activities viii.Brand consciousness ix.Variety
2. Primary Research - Primary Research was carried out using a

questionnaire by interviewing consumers at a prominent mall in the city of Indore (Treasure Island, M. G. Road, Indore).
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Section C 3. Data

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Group 7

Preparation

&

Transcribing

The

data

from

the

questionnaire was collated and coded appropriately. After encoding the data was transferred to an electronic format to aid analysis.
4. Data Analysis Several methods of analysis were applied to the

prepared data a. Cross Tabulation b. Analysis of Variance (one way ANOVA) c. Regression Analysis d. Factor Analysis
e. Cluster Analysis

5. Interpretation of findings

Sampling Design

The target population was chosen at random among the various consumers visiting the food court. Sampling Frame : Random consumers visiting the Food Court Sampling Elements: Male or Female, 15 to 50 years of age Sampling : Convenience Sampling without replacement (Nonprobability sampling) Sample Size: 150 Time: July 2011 Execution: Approached target population to fill up a specifically designed questionnaire, codifying and cleaning the data for the analysis and carry out the analysis using SPSS The following key points were kept in mind while doing the sampling The Sampling Design used in the study is convenience sampling. A convenience sample chooses the individuals that are easiest to reach. It is where the respondents are selected, in part or in whole, at the convenience of the researcher.

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However, we took care that the sample was not skewed too much towards a particular section of people (say age wise).

Questionnaire Design

Primary Besides

Research this we

For

the

primary questions

research for

we

designed

questionnaire keeping the factors from the exploratory research in mind. also included understanding their preferences and spending habits. Questions were also included to carry out the cluster analysis to identify the kind of consumer segments. Questionnaire Design
i.

Factor Identification the consumers were questioned on a 7 point Likert scale for questions relating to the factors. The option choices were a.Strongly Agree b.Moderately Agree c.Mildly Agree d.Neutral e.Mildly Disagree f.Moderately Disagree g.Strongly Disagree

ii. Behaviour on Time and Expenditure The consumers

were asked to indicate their spending pattern towards food based on different times of the day. Their responses were captured on an interval scale. The option choices were
a.Rs 50 100 b.Rs 100 200 c.Rs 200 300 d.Rs 300+

e.Not Applicable to me
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iii. Personal Information Demographic information was also

collected like a.Age b.Profession c.Work Experience (in number of months) d.Gender e.Marital Status
iv. Consumer Behaviour Various questions were asked to the

consumer and their responses collated on a 5 point Likert scale. This was used as an input to cluster the consumer population. The clustering would help us in understanding the kind of consumers we elicited responses from. The respondents replied had the following options to choose from
a.Strongly Agree

b.Agree c.Neutral d.Disagree e.Strongly Disagree

Demographics

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Data Preparation & Analysis

Data Preparation Once the data had been collated it was coded and cleaned. The following coding patterns were followed
i.

Male

1 2 1 2 3 4 5 7 1 2 3 4 5 1 6

ii. Female

i.

Strongly Agree

ii. Moderately Agree iii. Mildly Agree iv. Neutral v. Mildly Disagree

vi. Moderately Disagree vii. Strongly Disagree -

i.

Strongly Agree

ii. Agree iii. Neutral iv. Disagree

v. Strongly Disagree -

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Section C ii. Rs 100 200 iii. Rs 200 300 iv. Rs 300+

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2 3 4 1 2 5

v. Not Applicable to me

i.

Unmarried

ii. Married

Once the coding was done, we identified scopes of cleaning the data. Since most of the data was collected via interviewing the respondents personally, there was little cleaning to be done. We however encountered two types of issues and our approach towards fixing those are as follows
Missing data Data Imputation (3 instances) Multiple responses for the same question Discarded the

particular data set. (2 instances)

Data Analysis Cross Tabulation Cross Tabulations is a technique which describes two or more variables simultaneously and results in tables that reflect the joint distribution of two or more variables that have a limited number of categories or distinct values. We carried out Cross Tabs for the following combination of variables (A) Ambience and Employment Status The Ambience preference data option values were consolidated into 2 values, Not Important and Important. The Employment Status option values were consolidated into 2 values, Not Working and Working. The NULL Hypothesis developed was:
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The employment status of a person did not have any influence on the importance he/she gives to ambience as a factor for choice of a food court at 90% confidence level. Result: The POb value obtained is 0.7327 which is greater than PHo = 0.1, hence the NULL Hypothesis is not rejected. So we can say with 90% confidence that the employment status of a person did not have any influence on the importance he/she gives to ambience as a factor for choice of a food court. The results of the cross tabulation are in table 1 and 2.

Tables Working code * Ambience code Cross Tabulation Count Ambience code Not Important Working code Not Working Working Total 28 26 54 46 48 94 74 74 148 Important Total

Table 1: Cross Tab (Ambience x Employment Status) Chi-Square Test Value df Asymp. sided) Pearson Chi-Square Continuity Correctionb Likelihood Ratio
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Sig.

(2-

0.116627266 0.029156816 0.116647421

1 1 1

0.732721678 0.864417459 0.732699467

Abhijeet, Amit, Arijit, Nikhilendra, Nitin, Prabhu, Puneet, Sheenam, Shishir

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Fisher's Exact Test Linear-by-Linear Association No of Valid Cases 148 Table 2: Cross Tab Chi-Square (Ambience x Employment Status) 0.115839243 1 0.733591728

(B) Promotional activity and Brand Consciousness The Promotional activity data option values were consolidated into 3 values, Influenced, Neutral and Not Influenced The Brand Consciousness data options values were consolidated into 3 values, Brand Conscious, Indifferent and Not Brand Conscious The NULL Hypothesis developed was: The level of brand consciousness of a person did not have any influence on the importance he/she gives to promotional activity as a factor for choice of a food court at 90% confidence level.

Result: The POb value obtained is 0.009 which is lesser than PHo = 0.1, hence the NULL Hypothesis is rejected. So we can say with 90% confidence that the level of brand consciousness of a person did have an influence on the importance he/she gave to promotional activity as a factor for choice of a food court. The results of the cross tabulation are in table 3 and 4. Brand_code * Promotion_code Cross Tabulation Count Promotion_code

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Influenced

Neutral

Not Influenced

Brand_code

Brand Conscious Indifferent Not Conscious

20 14

30 48 12

10 8 6

Brand 0

Total

34

90

24

Table 3: Cross Tab (Brand Consciousness x Promotion Activity) Chi-Square Test Value df Asymp. sided) Pearson Chi-Square Likelihood Ratio Fisher's Exact Test Linear-by-Linear Association No of Valid Cases 148 Table 4: Cross Tab Chi-Square (Brand Consciousness x Promotion Activity) (C)Proximity to alternate activities and Gender The proximity to alternate activities option values were consolidated into 3 values, Important, Neutral and Not Important 13.405a 16.598 14.07 6.723c 1 0.01 4 4 0.009 0.002 Sig. (2-

The NULL Hypothesis developed was: Gender of a person did not have any influence on the importance he/she gives to proximity to alternate activities (like shopping) as a factor for choice of a food court at 90% confidence level.
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Result: The POb value obtained is 0.06 which is lesser than PHo = 0.1, hence the NULL Hypothesis is rejected. So we can say with 90% confidence that the gender of a person does have an influence on the importance he/she gives to proximity to alternate activities (like shopping) as a factor for choice of a food court. The results of the cross tabulation are in table 5 and 6. Gender * Proximity_code Cross tabulation Count Proximity_code Important Neutral Not Important Gende r Female Total 24 48 32 68 8 32 64 148 Male 24 36 24 84 Total

Table 5: Cross Tab (Gender x Proximity Alternative) Chi-Square Tests Value Pearson Chi-Square Likelihood Ratio Fisher's Exact Test Linear-by-Linear Association N of Valid Cases 148 Table 6: Cross Tab (Gender x Proximity Alternative) 5.636a 5.896 5.697 4.264c 1 0.039 df 2 2 Asymp. Sig. (2-sided) 0.06 0.052

Analysis of Variance (One Way ANOVA) - The purpose of analysis of variance is to test differences in means (for groups or variables) for
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statistical significance. This is accomplished by analysing the variance, that is, by partitioning the total variance into the component that is due to true random error (i.e., within group SS) and the components that are due to differences between means. These latter variance components are then tested for statistical significance, and, if significant, we reject the null hypothesis of no differences between means, and accept the alternative hypothesis that the means (in the population) are different from each other. We have done a one way ANOVA or an ANOVA where there is only one factor (PRICE). Methodology: The means belonging to the groups (periods i.e. lunch, evening and dinner expenditure among the consumers visiting the food court) are denoted as 1, 2 and 3 respectively Hypothesis: Null Hypothesis - H0: 1=2= 3 Alternate Hypothesis - Ha: 123 The NULL Hypothesis: For our research we have taken the following as the NULL Hypothesis, that the amount of money a consumer spends for food at a food court is not significantly different for the period of the meal (Lunch, Evening Snacks or Dinner) at 99% confidence level. Result: The POb is very small in comparison to PHo = .01. Hence the NULL Hypothesis can be rejected. So we can say with 99% confidence that the amount of money a consumer spends for food at a food court is not significantly different for the period of the meal (Lunch, Evening Snacks or Dinner) The results of the one way ANOVA are captured in table 7 as given below
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ANOVA Spends Sum Squares Between Groups Within Groups Total 633.541 709.342 441 443 1.437 75.802 2 of df Mean Square 37.901 26.3823 6 1.50E11 F Sig.

Table 7: One way ANOVA

Cluster Analysis Cluster analysis is a class of techniques used to classify objects or cases into relatively homogeneous groups called clusters. Objects in each cluster tend to be similar to each other and dissimilar to objects in the other clusters. Cluster analysis is also called classification analysis, or numerical taxonomy. In cluster analysis there is no a priori information about the group or cluster membership for any of the objects. Groups or clusters are suggested by the data, not defined a priori. Cluster analysis has been used in marketing for a variety of purposes, including the following: Segmenting the market: For example, consumers may be clustered on the basis of benefits sought from the purchase of a product. Each cluster would consist of consumers who are relatively homogeneous in terms of the benefits they seek. This approach is called benefit segmentation. Understanding buyer behaviours: Cluster analysis can be used to identify homogeneous groups of buyers. Then the buying behaviour of each group may be examined separately on the basis
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of self-reported importance attached to each factor of the choice criteria and the kinds of strategies purchasers use to obtain external information Identifying new product opportunities: By clustering brands and products, competitive sets within the market can be determined. Brands in the same cluster compete more fiercely with each other than with brands in other clusters. A firm can examine its current offerings compared to those of its competitors to identify potential new product opportunities. Selecting test markets: By grouping cities into homogeneous clusters, it is possible to select comparable cities to test various marketing strategies. Reducing data: Cluster analysis can be used as a general data reduction tool to develop clusters or subgroups of data that are more manageable than individual observations. Subsequent multivariate analysis is conducted on the clusters rather than on the individual observations. (Sourced from Text: Marketing Research by Naresh. K. Malhotra) In our project analysis we have used two methods for cluster analysis. These are:

Hierarchical Clustering K means clustering

Hierarchical Clustering: This method of clustering provided us with a range of clusters from which we identified the number of clusters. Average Linkage (between groups): Agglomeration Schedule

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Sta ge

Cluster Combined

Coefficie nts

Stage Cluste r First Appea rs Cluste r1

Next Stage

Cluster 1 2 3 4 5 6 7 8 9 . . . . 10 133 134 135 136 137 138 139 140 141 142 143 144 145
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Cluster 2 150 149 148 147 146 145 144 143 142 . . . . 141 13 3 50 57 49 71 11 64 63 24 56 14 10 0 0 0 0 0 0 0 0 0 . . . . 0 14.5 15.03 15.1666 7 16 16.6666 7 17 18.0133 3 18.54 19.2307 7 19.5735 8 19.75 21.3160 9 22.0983 6

Cluste r2 0 0 0 0 0 0 0 0 0 . . . . 0 122 130 104 20 119 6 137 138 14 135 136 126 115 35 32 109 81 104 138 119 87 122 . . . . 110 143 139 142 143 139 140 140 141 142 144 146 145 146

1 116 119 74 73 72 71 70 69 68 . . . . 67 1 2 24 56 11 64 2 2 2 2 1 2 2

0 0 0 0 0 0 0 0 0 . . . . 0 113 132 129 21 124 13 134 139 140 141 133 142 144

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146 147 148 149

1 1 1 1

2 9 4 61

25.1901 27.5214 3 28.9652 8 35.6756 8

143 146 147 148

145 120 111 16

147 148 149 0

As seen in the table above there is a significant jump in the value of the coefficient after stage 145. So we can conclude that the number of clusters should be five. Next, we have used K means clustering to identify the following: 1. Composition of each cluster ( Which respondent belongs to which cluster) 2. The variables that distinguish each cluster 3. Segment profiles of each cluster based on the distinguishing variables ANOVA Cluster Mean Squar e Ability to pay 15.48 867 Quality Conscious Importance of family Importance of Savings
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Error Mean Squar e 4 0.651 163 4 0.356 685 4 0.543 929 4 0.402 599 145 145 145 145 df

Sig.

df

23.78 617 9.210 312 21.12 57 26.77 804

0.00

3.285 178 11.49 089 10.78 08

0.00

0.00

0.00

Abhijeet, Amit, Arijit, Nikhilendra, Nitin, Prabhu, Puneet, Sheenam, Shishir

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Variety seeking Health Conscious Advertisement s Ambience

3.480 287 5.597 49 11.06 195 7.509 568

0.583 027

145

5.969 345

0.00

0.295 655

145

18.93 248

0.00

0.596 038

145

18.55 914

0.00

0.627 276

145

11.97 171

0.00

Hangout Place

8.398 204

0.360 004

145

23.32 811

0.00

Taste

1.949 611

0.315 137

145

6.186 549

0.00

High Prices High Quality Peaceful Environment Distance from residence

18.48 874 8.742 024 7.064 596

0.772 724

145

23.92 67

0.00

0.633 14

145

13.80 742

0.00

0.590 586

145

11.96 201

0.00

Since all the variables have significant values less than 0.1 (for 90% confidence interval) all the variables are significant and should be considered. Final Cluster Centers Cluster 1 Ability to pay Quality Conscious Importance of family Importance of
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2 2.79 1.92

3 2.50 1.92

4 3.39 1.95

5 1.57 1.14

1.81 1.38

2.44

2.00

3.25

2.07

1.14

1.63

1.36

3.00

1.95

Abhijeet, Amit, Arijit, Nikhilendra, Nitin, Prabhu, Puneet, Sheenam, Shishir

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Savings Variety seeking Health Conscious Advertisements Ambience Hangout Place Taste High Prices High Quality Peaceful Environment Distance from residence 2.25 2.95 2.33 1.98 1.57 2.13 1.74 2.75 2.63 1.29 3.44 1.38 1.31 1.44 2.75 2.67 2.26 1.56 1.36 3.90 2.33 2.75 2.58 1.83 2.67 2.85 1.83 1.95 1.63 2.15 1.43 1.86 1 1 2 1.44 1.31 2.21 1.15 1.75 2.25 2.17 1.76 2 1.29

Number of Cases in each Cluster Cluster 1 2 3 4 5 Valid Missing 32 39 24 41 14 150 0

Segment Profiling:

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Cluster 1:Freedom loving
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. My salary allows me to spend on luxuries I do not mind paying for quality My family does not play in important part in my decisions I feel everyone should save for future I like trying new food varieties I believe health is very important I do not think that ads play an important role in my purchase decisions Ambience is very important for me I believe hanging out with friends is fun Sometimes I give importance to taste of food Sometimes I feel that good ambience comes at high price Sometimes I prefer eating in a peaceful setting Sometimes I dont mind travelling far for eating out

AMR Project
Cluster 2 : Conservative
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. My salary does not allow me to spend on luxuries I dont like paying for quality Sometimes family plays an important role in my decisions I feel everyone should save for future I do not like trying new varieties I believe health is very important Sometimes ads play an important role in my purchase decisions Ambience is not very important for me Sometimes hanging out with friends is fun Sometimes I give importance to taste I dont think that high price means high quality I dont like travelling far for eating out I dont travel far for eating out

Group 7

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Section C
Cluster 5 : Affluent
My salary allows me to spend on luxuries 2. do not mind paying for quality Cluster I 3: Indifferent 3. My family plays a important part in 1. my decisionsabout saving for spend With my salary I can sometimes 4. I am neutral on luxury future 2. I dont like paying for qualityfood 5. Sometimes I like trying new 3. My family does not play an important varieties 6. role in my decisions I believe health is very important 4. I do not think everyone should save 7. I think ads play an important role formy purchase decisions in future 5. Sometimes I like trying new food 8. Sometimes ambience is important varieties for me 6. I am not very health consciousis 9. I feel hanging out with friends 7. Sometimes ads play an important role fun 10. in my of food is very important for Taste purchase decisions 8. Ambience is not very important to me me 9. I dont think hanging out with friends 11. High price means high quality for is fun me 10. Taste ofeating in a peaceful 12. I prefer food is not very important to me setting 11. Sometimes I travellinghighfor 13. I dont mind feel that far price means out quality eating high 12. I dont like eating in a peaceful setting 13. I dont travel far for eating out 1.

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Cluster 4: Value for money

1.

2.
3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.

My salary does not allow me to spend on luxuries I am conscious about paying for quality Sometimes my family plays an important role in my decisions I am neutral about saving for future I dont like trying out new food varieties Sometimes I dont pay much importance to health Ads do not play an important role in my decisions Ambience is moderately important for me Sometimes hanging out with friends is fun Taste of food is not very important for me High price means high quality for me I dont prefer eating in a peaceful setting I dont mind travelling far for eating out

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Factor Analysis: Factor analysis is a statistical method used to describe variability among observed variables in terms of fewer unobserved variables called factors. The observed variables are modelled as linear combinations of the factors, plus "error" terms. The information gained about the interdependencies can be used later to reduce the set of variables in a dataset. Factor Analysis denotes a class of procedures used primarily for data reduction and summarization. It is very useful to reduce a large number of variables in marketing research, most of which are correlated, to a manageable level. Methodology In factor analysis, each variable is expressed as a linear combination of underlying factors. The amount of variance a variable shares with all other variables included in the analysis is referred to as communality. Ten Variables have been identified which are considered by the consumer. We aim to group these variables which show a certain degree of correlation among them and Label them as Factors depending on the kind of attributes they have
Communalities Initial PRICE AMBIENCE HYGIENIC LOCATIONS SERVICE QUALITY PROXIMITY PROMOTIONS BRANDCONSCIOUSNES S VARIETY 1 1 1 1 1 1 1 1 1 1

Extraction 0.82196917 6 0.68895163 0.65429020 9 0.70950701 2 0.77667071 4 0.74145085 6 0.72146978 3 0.18997355 9 0.66215715 8 0.58519552

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4 Extraction Method: Principal Component Analysis.

From the above table we see that Promotions is the activity for which variance is least explained by the 4 factors. In this case only 36.7% of the variance is explained by the factors. Next we look at the Total variance table. We find that there are there are 4 factors which have Eigen values greater than one and explain 69.65% of the variance.

Total Variance Explained

Com pone nt 1 2 3 4 5 6 7 8 9 10 Initial Eigen values Total 3.886 1.407 1.259 0.95 0.571 0.555 0.417 0.401 0.321 % of Variance 38.855 14.068 12.594 9.499 5.713 5.548 4.169 4.012 3.211 Cumulative % 38.855 52.923 65.516 75.016 80.728 86.276 90.445 94.457 97.668 Extraction Sums of Squared Loadings Total 3.88 1.40 1.25 % of Variance 38.855 14.068 12.594 Cumulativ e% 38.855 52.923 65.516 Rotation Sums of Squared Loadings Total 3.35 1.75 1.45 % of Variance 33.471 17.508 14.537 Cumulative % 33.471 50.98 65.516

0.233 2.332 100 Extraction Method: Principal Comp.

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Rotated Component Matrix Componen t PRICE 1 0 . 1 9 6 0 . 8 0 4 0 . 6 8 7 0 . 4 1 0 . 8 4 5 0 . 8 5 1 0 . 0 1 7 0 . 3 0 9 0 . 3 1 1 0 . 6 2 7 2 0. 1 5 5 0. 1 4 5 0. 4 2 5 0. 0 3 4 0. 0 4 8 0. 0 2 3 0. 8 4 8 0. 2 6 2 0. 7 3 7 0. 4 3 6 3 0. 8 7 2 0. 1 4 8 0. 0 3 8 0. 7 3 5 0. 2 4 7 0. 1 3 2

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AMBIENCE

HYGIENIC

LOCATION S

SERVICE

QUALITY

Cut of correlation coefficient 0.7 Result interpretation

Factor 1 Experience (Ambience/Service/Quality) Factor 2 Lifestyle (Proximity/Brand Consciousness) Factor 3 Economy (Price/Locations)

PROXIMITY

0. 0 4 0. 1 6 0. 1 4 9 0. 0 4 4

PROMOTIO NS

BRANDCO NSCIOUSN ESS VARIETY

Perceptual Mapping

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