By: Group 1 Amit Kumar Bishnu Panda Nishant Jain Subhasish Das

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Agenda
Indian Small Car Segment Management Decision Problem Marketing Research Problem Research Design Data Analysis Conclusion The way forward

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Indian Small Car Segment

Largest small-car market in the world Second largest exporter behind Japan Forms 60% of Indian Car Market Decline in growth by 50% in FY12 (Apr11-Oct11)
o Successive interest rate hikes o Increase in fuel price o Pressure on disposable income due to inflation

Diesel Penetration Negatively impacted by production disruptions at Maruti Suzuki, the market leader in the segment Competitive pressures intensifying on the back of new launches Small Car Segment grew by 2% by Dec-11 (FY12) w.r.t. 6.5% growth rate in 2011
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Management Decision Problem

A new entrant wants to come up with a winning car in the booming small car segment in India.

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Marketing Research Problem

To figure out the key parameters which contribute in the growing sales in the small car segment
Price Finance Options Distribution Post Sales Service Impact of communication channels Product Specifications Brand Loyalty Exchange of Cars (resale value) Safety Standards and Warranty Schemes

Psychographic Micro Environmental Macro Environmental

Brand Ambassador Social Status Changing Lifestyle Reference Occasions Family Need

Inflation Per Capita Disposable Income Global Crude Oil Prices Interest Rates Government Interventions Investments

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Model
Behavioural Intention = bi ei + NBj MCj
where, i = salient outcomes bi = how strongly do you believe that these outcomes will creep in ei = evaluation of the outcomes

j = relevant others NBj = opinion of relevant others MCj = motivation to comply others opinions
Beliefs Attitude Purchase Experience/Evaluation Repeat Purchase Loyalty

Affect

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Proposed Hypothesis

Hyp1: Price sensitiveness is high in consumer buying behavior in this segment. Hyp2: Financing options play an important part in buying behavior. Hyp3: Distribution has a substantial contribution in generating sales.
Hyp4: Post Sales Service has a substantial contribution in generating sales.

Hyp4: Communication channels play a vital role in generating awareness of a new car in the
segment.

Hyp5: It is the brand which influences the sale. Hyp6: Inflation has significant impact on buying behavior. Hyp7: Interest rates has significant impact on buying behaviour.
Hyp8: PCDI has significant impact on buying behaviour.
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Research Design
Exploratory Research Design
o Secondary Data: qualitative analysis o Experience Surveys

Descriptive Research Design

o Surveys via questionnaire o Multiple Cross Sectional Design

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Scaling Techniques and Measurement Scales

Scaling Techniques to be used in the questionnaire:
o Likert Scale (Non-comparative Scales) o Multi-item Scales (Non-comparative Scales)

Data obtained in the following scales viz.

o Nominal o Interval o Ratio

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Sampling Techniques and Sample Size

Sampling Method:
o Stratified Random Sampling
o Criterion: i) Age Group ii) Income Group

Sample Size:
o 158 for Primary Research

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Data Analysis

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Demographics-Sample
Age Group

Occupation

Annual Income

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Do you have a car?

Sample Survey Status:

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The reason(s) for purchasing a car

Hypothesis: Every factor has equal impact on the purchase of a car H0: All reasons have equal importance vs. H1: H0 is false
Chi-Square Calculated = 473.76 Chi-Square Critical = 187.24 Level of significance = .05 H0 is rejected. Infrence: Each factor has diffrent impact on purchasing a car.

Link to Excel Sheet

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Express your opinion regarding importance of the following factors in purchasing a car
Hypothesis: Each factor has equal effect on buying a car
H0: = 0 vs. H1: 0 t Calculated = 5.24 t Critical = 2.263 Level of significance = .05 H0 is rejected. Infrence: Each factor has diffrent impact on purchasing a car.

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How strongly do you believe that the following attributes should be present in your chosen/present car?
Hypothesis: Choosing a car will be independent of the attributes (Product
specific) H0: = 0 vs. H1: 0 t Calculated = -9.85 t Critical = -2.263 Level of significance = .05 H0 is rejected. Infrence: Choosing a car will be very much dependent on the attributes

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How strongly do you believe that the following factors have contributed/shall contribute to your purchasing of car?
Hypothesis: Choosing a car will be independent of the attributes (External
Parameters) H0: = 0 vs. H1: 0 t Calculated = -16.89 t Critical = -2.263 Level of significance = .05 H0 is rejected. Infrence: Choosing a car will be very much dependent on the external parameters.

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Tick the factors which you think shall influence your buying decision of a car
Hypothesis: Every factor has equal influence on the purchase of a car H0: = 0 vs. H1: 0
t Calculated = 12.654 t Critical = 2.247 Level of significance = .05 H0 is rejected.

Infrence: Each factor has diffrent influence on purchasing a car.

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Cross Tabulation
H01: There is no significant difference in the impact of individual factors on all age group
of customers while purchasing a car similar buying behavior of cars

H02: Keeping the factors constant, customers falling under different age groups have
F calculated (rows): 28.43 > F critical: 2.89 i.e. H02 rejected F calculated (columns): 1.26 < F critical: 2.09 i.e. H01 accepted Level of significance: .05 Inference: The deciding factors stated doesnt have significant difference on the different age group of customers, where as small cars are more preferred by individuals within age group of 21 yrs. to 30 yrs., compared to others. ANOVA TABLE
Source of Variation Age Group Parameters Error Total
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SS 293961.8958 47701.22917 113714.8542 455377.9792

df 3 11 33 47

MS 97987.29861 4336.475379 3445.904672

F F crit 28.43587039 2.891563517 1.258443222 2.093254411

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Cross Tabulation
H01: There is no significant difference in the impact of individual factors on all income
groups while purchasing a car

H02: Keeping the factors constant, customers falling under different income groups have
similar buying behavior of cars F calculated (rows): 8.309 > F critical: 2.89 F calculated (columns): 12.14 > F critical: 2.09 Level of significance: .05 Inference: The deciding factors stated have significant difference on the customers of different income groups and there is also a significant difference between the different income groups so far as purchasing cars are concerned.
Source of Variation Rows Columns Error Total
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ANOVA TABLE SS df MS 8900.729167 3 2966.909722 47701.22917 11 4336.475379 11782.02083 33 357.0309343 68383.97917 47

F F crit 8.309951427 2.891563517 12.1459374 2.093254411

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Theory of Reasoned Action

Behavioural Intention = bi ei + NBj MCj

bi*ei = 140.3506 NBj MC j = 0.27

Therefore, BI = 140.62

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Recommendations..(1/2)
Comfortable Safety Quotient Fuel Efficiency Style Spacious
Penetration Pricing Value for Money

Product

Price

Place
Distributors and Dealers Service Centre Availability
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Promotion
Advertisements Print Media Internet Marketing Branding

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Recommendations..(2/2)
Potential Markets: Urban & Semi Urban Hot Cake: Working Professionals within age group 21-30 yrs.

Ad-hoc benefits to be offered:

Post Sales Service Financing tie ups Warranty Schemes Sales promotion to be given during festive seasons Advertisements must impact on the psychology of Indian Mango People.

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Thank You

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