CONSUMER BUYING BEHAVIOUR TOWARDS CFL (COMPACT FLUORESECNT LAMPS)
A PROJECT REPORT
Submitted by
SUCHIT THAKOR
Submitted to
MR. BHAUMIK SHAH
in partial fulfilment for the award of the degree
of
BACHELOR OF BUSINESS ADMINISTRATION
in
MARKETING MANAGEMENT
BHAGWAN MAHAVIR COLLEGE OF BUSINESS ADMINISTRATION, SURAT
VEER NARMAD SOUTH GUJARAT UNIVERSITY
2012
ACKNOWLEDGEMENT
I am indebted to Mr.Rajesh Desai, director of Karuna Engineer Consultant, Surat
Authorised distributor of Philips Electronics India Ltd. for giving me an opportunity
to work as a winter project trainee in this esteemed organization. His knowledge and
experience was a great motivating factor. This effort would not have been possible
without his able, efficient, valuable and timely advice, insights and thoughts. I am very
much thankful to sir for his valuable guidance and support.
I take this opportunity to express my heartfelt gratitude to my faculty guide Prof.
Bhaumik Shah, Faculty of Marketing, Bhagwan Mahavir College of Business
Administration, (VNSGU). I am thankful to sir for his valuable support and guidance
throughout the project.
I am also thankful to Miss. Priyanka Patel, Sales incharge, Karuna Engineer
Consultant for her assistance and support, I am equally grateful to each and every
member of KEC, Surat for their whole-hearted co-operation in completing this project
in stipulated time.
I extend my sincere thanks to the all respondent who serve me there prestigious time
me for my project.
Last but not the least, I would like to thank my family members and friends whose
unbounded support facilitated the successful completion of the project.
SUCHIT THAKOR
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EXECUTIVE SUMMARY
The project was carried out for Philips Electronic India Ltd., which is one of the
leading Electronic firms.
The project was undertaken during 7 weeks winter training at Karuna Engineer
Consultant in my capacity as a management student with marketing specialization.
The job assigned to me for the project was to do market Analysis and noticing
consumer behaviour regarding CFL.
The entitled project was having many primary and secondary objectives to achieve the
objectives are as follows -------
PRIMARY OBJECTIVES:-
To identify the market standing of the Philips with its competitive companies.
To study and analyse the perception status and consumer behaviour regarding
Philips CFL in the Market.
SECONDARY OBJECTIVES:-
Find out the potential market and also prefer to write for competitive.
Find out the potential customers, who can be very beneficial for the company.
To make aware the customer about company’s product and to educate them
and aware about the different benefits.
To have a healthy conversation with customer to build a good relationship, to
find out the problem related with the company product.
To formulate the competitive marketing strategies to have better approach to
the customer.
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INDEX
Chapter No.
Content Page No:
Acknowledgement 1
Executive Summary 4
1 Introduction to Industry 6
2 Introduction to Company 17
3 Theoretical aspect of the study 28
4 Research Methodology 38
5 Data Analysis & Findings 47
6 Suggestion and Conclusion 64
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Chapter-1
INTRODUCTION TO THE
INDUSTRY
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Compact Fluorescent Lamps (CFLs)
Never before have so many people had so much power to do something as simple as
changing a light bulb to save money and fight global warming simultaneously!
INTRODUCTION
A compact fluorescent lamp (CFL), also known as a compact fluorescent light bulb (or
less commonly as a compact fluorescent tube [CFT]) is a type of fluorescent lamp.
Many CFLs are designed to replace an incandescent lamp and can fit in the existing
light fixtures formerly used for incandescent.
Compared to incandescent lamps of the same luminous
flux, CFLs use less energy and have a longer rated life.
In the United States, a CFL can save over 30 USD in
electricity costs over the lamp's lifetime compared to an
incandescent lamp and save thousands of times its own
weight in greenhouse gases. The purchase price of a
CFL is higher than that of an incandescent lamp of the
same luminous output, but this cost is recovered in
energy savings and replacement costs over the bulb's
lifetime.
Improved phosphor formulations have improved the subjective colour of the light
emitted by CFLs such that the best 'warm white' CFLs available now such as Sani
Bulb and Carbon Neutral Bulb are subjectively similar in colour to standard
incandescent lamps and provide superior lighting quality.
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HISTORY
The parent to the modern fluorescent lamp was invented in the late 1890s by Peter
Cooper Hewitt. The Cooper Hewitt lamps were used for photographic studios and
industries.
Edmund Germer, Friedrich Meyer, and Hans Spanner patented a high-pressure vapour
lamp in 1927.George Inman later teamed with General Electric to create a practical
fluorescent lamp, sold in 1938 and patented in 1941. Circular and U-shaped lamps
were devised to reduce the length of fluorescent light fixtures. The first fluorescent
bulb and fixture were displayed to the general public at the 1939 New York World's
Fair.
The helical (three-dimensional spiral) CFL was invented in 1976 by Edward Hammer,
an engineer with General Electric, in response to the 1973 oil crisis. Although the
design met its goals, and it would have cost GE about US$25-million to build new
factories to produce the lamps, the invention was shelved. The design eventually was
copied by others. IN 1995, helical lamps, manufactured in China, became
commercially available; their sales have steadily increased.
In 1980, Philips introduced its model SL, which was a screw-in lamp with integral
magnetic ballast. The lamp used a folded T4 tube, stable tri-colour phosphors, and a
mercury amalgam. This was the first successful screw-in replacement for an
incandescent lamp. In 1985 Osram started selling its model EL lamp, which was the
first CFL to include electronic ballast.
Development of fluorescent lamps that could fit in the same volume as comparable
incandescent lamps required the development of new, high-efficacy phosphors that
could withstand more power per unit area than the phosphors used in older, larger
fluorescent tubes.
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CFL ADOPTION QUICKLY GAINING WIDESPREAD SUPPORT
Due to the enormous potential to increase energy
savings and reduce pollution, various organizations
and companies have undertaken a variety of
creative measures to encourage the adoption of
CFLs. In addition, governments across the globe
are considering strong measures to encourage
adoption of CFLs or to even entirely displace
incandescent. Some countries have proposed
efforts that involve tax measures, while others have
gone further by instituting bans on future
production of incandescent light bulbs. Ireland is
the first country to implement a ban in 2009 and
Australia phases out incandescent lights by 2010.
The United States and Canada have also committed
to phasing out incandescent lights in 2012.
But still in India there are many uses of incandescent lights, in rural region of India
70% is the usage of incandescent lamps.
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COMPARISON WITH INCANDESCENT LAMPS
Lifespan
Modern CFLs typically have a lifespan of between 6,000 and 15,000 hours, whereas
incandescent lamps are usually manufactured to have a lifespan of 750 hours or 1,000
hours.
Energy Consumption
For a given light output, CFLs use between one fifth and one quarter of the power of
an equivalent incandescent lamp. For example, lighting accounted for approximately
9% of household electricity usage in the United States in 2001, so widespread use of
CFLs could save most of this, for a total energy saving of about 7% from household
usage.
Energy Efficiency
The actual energy efficiency of CFLs compared to other lamp technologies such as
incandescent, LED and halogen is significantly better. This makes a compelling case
to switch over to them.
Energy Savings Since
Since CFLs use less power to supply the same amount of light as an incandescent lamp
of the same lumen rating, they can be used to decrease energy consumption at the
location in which they are used. In countries where electricity is largely produced from
burning fossil fuels, the savings reduces emissions of greenhouse gases and other
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pollutants; in other countries the reduction may help reduce negative impacts from
radioactive waste, hydroelectric plants or other sources.
Cost
In addition to the savings on energy costs, the average life of a
CFL is between 8 and 15 times that of incandescent. While the
purchase price of a CFL is typically 3 to 10 times greater than
that of an equivalent incandescent lamp, the extended lifetime
(fewer lamps to replace and reduced labour) and lower energy
use will compensate for the higher initial cost in most
applications. A US article stated "A household that invested
$90 in changing 30 fixtures to CFLs would save $440 to
$1,500 over the five-year life of the bulbs, depending on your
cost of electricity. Look at your utility bill and imagine a 12%
discount to estimate the savings."
Helps Fight Global Warming xcvxcvxcvcxvxcvxcvcxvxcvxc
Light is powered mainly by coal burning power plants and
natural gas, both of which create greenhouse gases (GHG) that
cause global warming. The EPA estimates that 1.535 lbs. of
greenhouse gases are released into the atmosphere for every
kilowatt hour of electricity generated by a coal-fired plant.
Replacing a single 100 watt conventional incandescent light
bulb with a 25 watt CFL can prevent more than 169 pounds of
coal from being burned and reduce greenhouse gas emissions
by 814 pounds over the lifetime of the bulb. Looking at the big
picture, if every American swapped a single incandescent bulb
with a CFL, it would collectively save $8 billion in energy
costs, prevent burning 30 billion pounds of coal and remove 2
million cars worth of greenhouse gas emissions from our
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environment. Now imagine what a difference we can make if we switched all our
incandescent light bulbs to CFLs!
Prevents Other Pollution Too Coal-fired
Coal-fired power plant smokestacks are also a big threat to health. In addition to
releasing carbon dioxide, they also release sulphur dioxide (main cause of acid rain),
nitrogen oxide (causes smog and acid rain), radioactive pollutants (can release more
than a nuclear power plant) and particulates. These deadly pollutants could lead to
heart attacks, strokes, asthma attacks and premature deaths.
Enjoy Warm Inviting Lighting There
There is no reason to be concerned about CFL lighting quality anymore. It has been
improving dramatically since they were first introduced almost 20 years ago. CFL
light quality now rivals traditional light bulbs in many applications. They turn on
instantly, don’t hum, are flicker free and the 2,700K warm white version CFLs
delivers warm inviting light that is indistinguishable from incandescent lights. This is
made possible by use of rare earth phosphors for excellent colour and warmth. In fact,
according to a study performed by Popular Mechanics, CFLs scored higher than
incandescent bulbs for overall quality of the light. In other words, CFLs aren’t just
better for both your wallet and the environment, they produce better light and they
don’t peek above most lamp shades anymore!
Reduces Fire Hazards Standard
Standard old fashioned incandescent light bulbs are very inefficient. In fact, over half
the energy consumed by them produces heat, not light. Your home or business will be
safer when you switch to CFLs since it produces less heat thus reducing fire hazards.
This reduction in heat will also cut your AC bills when the weather gets hot.
Maintenance Free Simply
Simply replace your old fashioned incandescent light bulbs with CFLs and forget
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about them. Since they last for over 8,000 hours, which is ten times longer than
incandescent bulbs, you won’t have to replace them for a very long time. Imagine
cutting down on your trips to buy bulbs and the times you have to change those hard to
get to bulbs.
Also, since CFLs are quiet, you won’t notice the difference while you enjoy your
music, TV or share a quiet conversation. So switch to CFLs, sit back and bask in its
long lasting, comfortable, energy saving light while fighting global warming.
INDUSTRY GROWTH RATE IN INDIA
The Lighting industry has witnessed an annual growth rate of about 12% per annum in
the last four years. Amongst the various products, the consumption of CFLs has
increased at a very large growth rate, as high as 50%, in the year 2010. Similarly, the
fluorescent tube lights market has shown a growth rate of 10% in 2010
PEST ANALYSIS
PEST analysis is concerned with the key external environmental influences on a
business.
The acronym stands for the Political, Economic, Social and Technological issues that
could affect the strategic development of a business.
Identifying PEST influences is a useful way of summarising the external environment
in which a business operates. However, it must be followed up by consideration of
how a business should respond to these influences.
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The table below lists some possible factors that could indicate important environmental
influences for a business under the PEST headings:
Political / Legal Economic Social Technological
Environmental regulation and protection
Economic growth (overall; by industry sector)
Income distribution (change in distribution of disposable income;
Government spending on research
Taxation (corporate; consumer)
Monetary policy (interest rates)
Demographics (age structure of the population; gender; family size and composition; changing nature of occupations)
Government and industry focus on technological effort
International trade regulation
Government spending (overall level; specific spending priorities)
Labour / social mobility
New discoveries and development
Consumer protection Policy towards unemployment (minimum wage, unemployment benefits, grants)
Lifestyle changes (e.g. Home working, single households)
Speed of technology transfer
Employment law Taxation (impact on consumer disposable income, incentives to invest in capital equipment, corporation tax rates)
Attitudes to work and leisure
Rates of technological obsolescence
Government organisation / attitude
Exchange rates (effects on demand by overseas
Education Energy use and costs
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customers; effect on cost of imported components)
Competition regulation Inflation (effect on costs and selling prices)
Fashions and fads Changes in material sciences
Stage of the business cycle (effect on short-term business performance)
Health & welfare Impact of changes in Information technology
Economic "mood" - consumer confidence
Living conditions (housing, amenities, pollution)
Internet!
MARKET PLAYERS AND MARKET LEADER.
HAVELLS INDIA LTD ORPAT ELECTRONICS
PHILIPS ELECTRONICS INDIA LTD. WIPRO LIGHTING
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CROMPTON GREAVES LIMITED OREVA ELECTRONICS INDIA
BAJAJ ELECTRICALS LTD. OSRAM LIGHTING
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SURYA ROSHNI LTD POLAROID ELECTRONICS
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INTRODUCTION TO THE
Company
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COMPANY PROFILE
ROYAL PHILIPS ELECTRONICS
Royal Philips Electronics of the Netherlands is a diversified Health and Well-being
company, focused on improving people’s lives through timely innovations. As a world
leader in healthcare, lifestyle and lighting, Philips integrates technologies and design
into people-centric solutions, based on fundamental customer insights and the brand
promise of “sense and simplicity”.
Headquartered in the Netherlands, Philips employs approximately 119,000 employees
in more than 60 countries worldwide. With sales of EUR 25.4 billion in 2010, the
company is a market leader in cardiac care, acute care and home healthcare, energy
efficient lighting solutions and new lighting applications, as well as lifestyle products
for personal well-being and pleasure with strong leadership positions in male shaving
and grooming, portable entertainment and oral healthcare.
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COMPANY PROFILE (PHILIPS ELECTRONICS INDIA PVT. LTD.)
PROFILE
Philips started operations in India at Kolkata (Calcutta) in 1930. Established as
“Philips Electrical Co. (India) Pvt Ltd”, the company comprised a staff of 75 and was
a sales outlet for Philips lamps imported from overseas.
In keeping with the Philips philosophy of promoting the industrial development of
emerging economies, Philips India set up its first Indian lamp-manufacturing factory
in 1938 in Kolkata.
Subsequently, Philips decided to produce radio receivers in India to make this product
readily and widely available to the Indian consumer. In 1948, after the Second World
War, Philips started manufacturing radios in Kolkata. The first valve-based Philips set
was well received by the consumers. This was a major turning point for Philips India,
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and marked the beginning of the company's subsequent growth in the world of
electronics.
In 1957, the company is converted into a public limited company, renamed “Philips
India Ltd” and in 1959, a second radio factory is established near Pune.
In 1963, Philips invents the compact audio tape cassette and sets a global standard for
tape recording that has never been altered since. India gets exposed to this Philips
invention.
In 1965 (3 April), the millionth Philips radio is manufactured in India. In the same
year Philips pioneers the concept of son-et-lumiere shows in India with the installation
of such a lighting and electro-acoustic system at the Red Fort in Delhi.
In 1970 a new consumer electronics factory is started in Pimpri near Pune.
Come 1982, Philips brings colour television transmission to India with the supply of
four outdoor broadcast vans to Doordarshan during the IX Asian Games. The company
also completes a prestigious turnkey project by handling the lighting and electro-
acoustic installations of stadia built specially for the IX Asian Games.
In 1983, Philips launches the Compact Disc and revolutionizes the way the world
listens to music.
In 1985, Philips inaugurates its consumer electronics factory at Salt Lake, Kolkata.
1993 sees Philips launching its domestic appliance business in India and in 1995
Philips introduces compact fluorescent lamps into the country.
In 1996, the Philips Software Centre is established in Bangalore.
In 1998, Philips launches Flat Televisions and CD-recorders - both firsts in India.
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As is seen, throughout the 1900’s Philips continued to bring the Indian consumer new
and innovative products backed by the latest technology and bearing the renowned
Philips stamp of quality.
BOARD OF DIRECTORS
LIGHTING SEGMENT
Philips Electronics India, India’s largest lighting company operates in business areas
of Lamps, Luminaires, Lighting Electronics, Automotive and Special Lighting. Today,
as global leader in Lighting, Philips is driving the switch to energy-efficient solutions.
With worldwide electrical lighting using 19 per cent of all electricity, the use of
energy-efficient lighting will significantly reduce energy consumption around the
world and thereby cut harmful CO2 emissions. Philips India has been consistently
working with industry bodies such as ELCOMA, Bureau of energy efficiency and
NGOs towards addressing India’s power crisis through promotion of energy efficient
lighting in India.
Philips provides advanced energy-efficient solutions for all segments: road lighting,
office & industrial, hospitality and home. Philips is also a leader in shaping the future
with exciting new lighting applications and technologies such as LED technology,
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Non-Executive Director & Chairman S. M. Datta
Managing Director & CEO Rajeev Chopra
Executive Director Jan-Hein Louwman
Non-Executive Director S. Venkatramani
which, besides energy efficiency, provides attractive benefits and endless new ‘never-
before-possible’ lighting solutions.
In 2008, Philips inaugurated a global research and development (R&D) centre for
lighting electronics in India. This was its third such unit in the world. The facility
which is situated in Noida will not only cater to the needs of the Indian market but also
the Asia-Pacific, Europe and North America. The other R&D centres are located at
Eindhoven in the Netherlands and in Shanghai, China. One of the primary research
areas for the centre is to develop products that can tackle high voltage fluctuations in
India. The centre currently employs 35 engineers. Around 40 per cent of Philips’
revenue in India comes from the lighting business.
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Mission
"Improve the quality of
people’s lives through
timely introduction of
meaningful innovations."
Vision
“In a world where
complexity increasingly
touches every aspect of our
daily lives, we will lead in
bringing sense and
simplicity to people.”
Behaviours
Eager to win
Take ownership
Team up to excel
BRAND:
Philips is more than just a company name – it’s a brand that promises an experience to
people. Whether it was lighting lives in 1891 when we introduced our first
incandescent light bulb, to saving lives with the Heart Start defibrillator, people have
always been at the heart of Philips.
Prior to the launch of “sense and simplicity,” we did not have a consistent way within
our organization to deliver a one-Philips brand experience to customers. The launch of
our brand promise - “sense and simplicity” - in 2004 was an important milestone in
our brand journey. This step change guided the organization to deliver a consistent,
differentiated brand experience; helping us to build our brand in the hearts and minds
of people.
This brand promise encapsulates our commitment to deliver solutions that are
advanced, easy to use, and designed around the needs of all our users and customers.
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VARIOUS CFL’S PRODUCT OF PHILIPS
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PHILIPS GROTH RATE IN INDIA
PHILIPS ELECTRONICS INDIA LTD. Annual report concludes that lighting and
healthcare businesses continue to perform strongly both in terms of turnover and
increase in respective market share. Lighting business recorded an all-time high
growth of 24%, in 2010. Company bagged highest ever supply of 14.5 million
Compact Fluorescent Lamps to Kerala State Electricity Board under the clean
development mechanism (Carbon Credit) project.
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SWOT ANLYSIS
STRENGTH
Assets leverage
Effective communication
High R & D.
Innovation
Loyal customers
Market share leadership
Strong team management
Strong brand equity
Strong financial position
Reputation management
LED technology
WEAKNESS
Weaker distribution network
Price
Poor business level strategy
Not get emerge monopoly benefit
as a pioneer.
OPPORTUNITY
Government regulations and green
push
Rising electricity price
THREATS
Competitions
Cheaper technology
Economic slow down
Exchange rate fluctuations
Lower competitors or imports
Price wars
Budgetary & taxation policy.
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Chapter-3
Theoretical Aspect of The
Study
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Marketing is the science of meeting
the needs of a customer by providing
valuable products to customers by
utilizing the expertise of the
organization, at same time, to archive
organizational goals.
According to The American
Marketing Association, “Marketing is
the activity, set of institutions, and
processes for creating,
communicating, delivering, and
exchanging offerings that have value
for customers, clients, partners, and
society at large.”
With this definition, it is important to
realize that the customer can be an
individual user, a company, or several
people who contribute to the
purchasing decision. The product can
be a hard good, a service, or even an
idea – anything that would provide
some value to the person who
provides an exchange. An exchange
is most often thought of as money,
but could also be a donation of time
or effort, or even a specific action. A
producer is often a company, but
could be an individual or non-profit
organization.
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CONSUMER BUYING BEHAVIOUR
The decision processes and acts of final household consumers associated with
evaluating, buying, consuming, and discarding products for personal consumption
Consider the purchase an automobile. You generally will not consider different
options until some event triggers a need, such as a problem needing potentially
expensive repair. Once this need has put you "on the market", you begin to ask your
friends for recommendations regarding dealerships and car models. After visiting
several dealerships, you test drive several models and finally decide on a particular
model. After picking up your new car, you have doubts on the way home, wondering
if you can afford the monthly payments, but then begin to wonder if instead you
should have purchased a more expensive but potentially more reliable model. Over the
next five years, the car has several unexpected breakdowns that lead you to want to
purchase a different brand, but you have been very happy with the services of the local
dealership and decide to again purchase your next car there.
In this particular case, the following generic model of consumer decision making
appears to hold:
=====>need recognition
=====>information search
=====>evaluation of alternatives
=====>purchase decision
=====>post purchase Behaviour
Now consider the purchase of a quart of orange juice. You purchase this product when
you do your grocery shopping once per week. You have a favourite brand of orange
juice and usually do your grocery shopping at the same store. When you buy orange
juice, you always go to the same place in the store to pick it up, and never notice what
other brands are on the shelf or what the prices of other brands are. How is it that the
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generic model above works differently in this second scenario? Why does it work
differently?
Why would we generally need the ministrations of a sales person in the sale of a car,
but we generally do not need the help of a salesperson in the purchase of orange juice?
How can the marketer of orange juice get a consumer like you to exert more effort into
information search or to consider alternative products? How is it that the marketer of
your brand got you to ignore alternative competing brands? What is the involvement
of salespeople in sales promotions that might be associated with products such as
orange juice?
Consumer Behaviour researchers are not so interested in studying the validity of the
above generic model, but are more interested in various factors that influence how
such a model might work.
GROUP INFLUENCES ON CONSUMER BEHAVIOUR
Culture
the set of basic values, beliefs, norms, and associated Behaviours that are learned by a
member of society
Note that culture is something that is learned and that it has a relatively long lasting
effect on the Behaviours of an individual. As an example of cultural influences,
consider how the salesperson in an appliance store in the U.S. must react to different
couples who are considering the purchase of a refrigerator. In some subcultures, the
husband will play a dominant role in the purchase decision; in others, the wife will
play a more dominant role.
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Social Class
A group of individuals with similar social rank, based on such factors as occupation,
education, and wealth.
Reference Groups
Groups, often temporary, that affects a person's values, attitude, or Behaviours
E.g., your Behaviours around colleagues at work or friends at school are
probably different from your Behaviours around your parents, no matter your
age or stage in the family life cycle. If you were a used car salesperson, how
might you respond differently to a nineteen year old prospect accompanied by
her boyfriend from one accompanied by two girlfriends?
Opinion leader
A person within a reference group who exerts influence on others because of
special skills, knowledge, personality, etc.
o You might ask the webmaster at work for an opinion about a particular
software application. Software manufacturers often give away free beta
copies of software to potential opinion leaders with the hope that they
will in turn influence many others to purchase the product.
Family
A group of people related by blood, marriage, or other socially approved
relationship
Environmental/ Situational Influences on Consumer Behaviour
Circumstances, time, location, etc.
Do you like grapes? Do you like peas?
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You might like grapes as a snack after lunch, but probably not as a dessert after a
fancy meal in a restaurant. You might like peas, but probably not as a topping on your
pancakes. Everyday situations cause an interaction between various factors which
influence our Behaviours. If you work for tips (a form of incentive related to
commission) as a waiter or waitress, you must certainly be aware of such interactions
which can increase or decrease your sales.
If you are doing your Saturday grocery shopping and are looking for orange juice, you
are probably much more sensitive to price than if you stop at the quick store late at
night, when you are tired and cranky, after a late meeting at the office. A prospect
shopping for a new automobile while debating the wisdom of a necessary expensive
repair to his car might be more interested in what cars are on the lot than in shopping
for the best deal that might involve a special order.
Internal Influences on Consumer Behaviour
Personality
A person's distinguishing psychological characteristics that lead to relatively consistent
and lasting responses to stimuli in the environment
We are each unique as individuals, and we each respond differently as consumers. For
example, some people are "optimizers" who will keep shopping until they are certain
that they have found the best price for a particular item, while other people are
"satisfices" who will stop shopping when they believe that they have found something
that is "good enough." If you are a salesperson in a retail shoe store, how might you
work differently with these two personalities?
Lifestyle and Psychographics
lifestyle is a pattern of living expressed through a person's activities, interests,
and opinions
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Psychographics is a technique for measuring personality and lifestyles to
developing lifestyle classifications.
Motivation: Multiple motives
Consumers usually have multiple motives for particular Behaviours. These can be a
combination of:
manifest
known to the person and freely admitted
latent
unknown to the person or the person is very reluctant to admit
Note: different motives can lead to the same Behaviour; observing Behaviour is not
sufficient to determine motives.
As we’ve seen, consumer purchasing is quite complex.
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MARKETING MIX
The marketing mix is a business tool used in marketing products. The marketing mix
is often crucial when determining a product or brand's unique selling point (the unique
quality that differentiates a product from its competitors), and is often synonymous
with the 'four Ps': 'price', 'product', 'promotion', and 'place'. However, in recent times,
the 'four Ps' have been expanded to the 'seven Ps' with the addition of 'process',
'physical evidence' and 'people'.
The term "marketing mix" was coined in 1953 by Neil Borden in his American
Marketing Association presidential address. However, this was actually a
reformulation of an earlier idea by his associate, James Culliton, who in 1948
described the role of the marketing manager as a "mixer of ingredients", who
sometimes follows recipes prepared by others, sometimes prepares his own recipe as
he goes along, sometimes adapts a recipe from immediately available ingredients, and
at other times invents new ingredients no one else has tried.
Four P’s
The 'four Ps' consist of the following:
Product - A product is seen as an item that satisfies what a consumer needs or
wants. It is a tangible good or an intangible service. Intangible products are service
based like the tourism industry & the hotel industry or codes-based products like
cell phone load and credits. Tangible products are those that can be felt physically.
Typical examples of mass-produced, tangible objects are the motor car and the
disposable razor. A less obvious but ubiquitous mass produced service is
a computer operating system.
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Every product is subject to a life-cycle including a growth phase followed by a
maturity phase and finally an eventual period of decline as sales falls.
Marketers must do careful research on how long the life cycle of the product
they are marketing is likely to be and focus their attention on different
challenges that arise as the product moves through each stage.[1]
The marketer must also consider the product mix. Marketers can expand the
current product mix by increasing a certain product line's depth or by increase
the number of product lines. Marketers should consider how to position the
product, how to exploit the brand, how to exploit the company's resources and
how to configure the product mix so that each product complements the other.
The marketer must also consider product development strategies.
Price – The price is the amount a customer pays for the product. The price is very
important as it determines the company's profit and hence, survival. Adjusting the
price has a profound impact on the marketing strategy, and depending on the price
elasticity of the product, often; it will affect the demand and sales as well. The
marketer should set a price that complements the other elements of the marketing
mix.
When setting a price, the marketer must be aware of the customer perceived
value for the product. Three basic pricing strategies are: market pricing,
marketing penetration pricing and neutral pricing. The 'reference value' (where
the consumer refers to the prices of competing products) and the 'differential
value' (the consumer's view of this product's attributes versus the attributes of
other products) must be taken into account.
Promotion - represents all of the methods of communication that a marketer may
use to provide information to different parties about the product. Promotion
comprises elements such as: advertising, public relations, personal
selling and sales promotion.
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Advertising covers any communication that is paid for, from cinema
commercials, radio and Internet advertisements through print media and
billboards. Public relations is where the communication is not directly paid for
and includes press releases, sponsorship deals, exhibitions, conferences,
seminars or trade fairs and events. Word-of-mouth is any apparently informal
communication about the product by ordinary individuals, satisfied customers
or people specifically engaged to create word of mouth momentum. Sales staff
often plays an important role in word of mouth and public relations.
The company launched an aggressive new advertising campaign in print,
television and online. The new tagline "Sense and simplicity" showcases the
new brand promises -- using technology to make life simpler and easier.
Company sources say Philips is counting on the new campaign to help it grow
by at least 25 per cent this year.
That's in the future, but how did Philips almost double its market share in less
than four years? Interestingly, the company didn't adopt radically different
strategies.
Place - refers to providing the product at a place which is convenient for
consumers to access. Place is synonymous with distribution.
Various strategies such as intensive distribution, selective distribution, exclusive
distribution and franchising can be used by the marketer to complement the other
aspects of the marketing mix.
Philips has 10 distributors in Surat and Philips CFL available at all electrical
shops, big bazar and Dhiraj sons etc.
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Chapter-4
Research methodology
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OBJECTIVES OF THE RESEARCH
Surat is the most developed city in southern Gujarat and to capture this market and
establish themselves as a leader is the prime aim of all the companies so as to have an
psychological impact on the people and to have an edge over other lighting companies
were not doing great business in This region from the very beginning. It was so
because the prices of the product were high and the customers were not fully aware of
proper advertisement facility, which is key factor in influencing a consumer. Earlier
Philips product was almost enjoying the monopoly market but now many companies
entered the market with various promotional schemes and changing the market
scenario.
Today all the companies namely Philips, Orpat, Bajaj, Wipro, Surya etc. are trying to
grab the market. According to research, Philips has the largest market share in India.
Every study is conducted with key objectives and aims kept in the fore. Without aims
and objectives the study is like a ship without radar. So aims and objectives of this
study are.
1. To understand the awareness level of Philips and Philips CFL.
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2. To know how satisfied are customers and retailers with the products
they purchase and the services provided by the company.
3. To find out what the customer and the retailer wants from Philips CFL.
4. To know the market shares of Philips CFL.
5. To know the perception of customer regarding the quality of Philips CFL.
6. To know the most influential factors that influences the customer
behaviour towards Philips CFL.
RESEARCH METHODOLOGY
Research methodology is a way to systematically solve the research problem. The
research methodology included various methods and techniques for conducting a
research. “Marketing Research is a systematic design, collection, analysis, and
reporting of data and finding relevant solution to a specific marketing situation or
problem.” Sciences define research as “ the manipulation of things, concepts or
symbols for the purpose of generalizing to extend, correct or verify knowledge,
whether that knowledge aids in construction of theory or in practice of an art.”
Research is thus, an original contribution to the existing stock of knowledge marketing
for its advancement, the purpose of research is to discover answers to the questions
through the application of scientific procedure.
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My research project has a specified framework for collecting the data in an effective
manner. Such framework is called “Research Design”. The research process which
was followed by me consisted following steps.
Research Problem
Research Objective
Information Requirement
Choice Of Research Design
Research Instruments Used
Products & Sample Size
Field Work
Defining the problem & Research Objectives
It is said, “A problem well defined is half solved”. The step is to define the project
under study and deciding the research objective. The definition of problem includes
Consumer Buying Behaviour towards PHILIPS CFL
Developing the Research Plan:
The second stage of research calls for developing the efficient plan for gathering the
needed information. Designing a research plan calls for decision on the data sources,
research approach, research instruments, sampling plan and contacts methods. The
research is descriptive in nature and is aimed at analysing the consumer behaviour
towards PHILIPS CFL.
The development of Research plan has the following Steps:
a.) Data Sources
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Two types of data were taken into consideration i.e. Primary data and Secondary
data. My major emphasis was on gathering the primary data. The secondary data
has been used to make things more clear.
i. Primary Data: Direct collection of data from the source of information,
including personal interviewing, mail survey.
ii. Secondary Data: Indirect collection of data from sources containing past
or recent information like, Annual Publications, Books, Newspaper and
Magazines etc.
Research Approach
Surveys are best suited for Descriptive Research. Surveys are undertaken to learn
about people’s knowledge, beliefs, preferences, satisfactions and so on and to
measure these magnitudes in the general public. Therefore I have done
Descriptive Research Process.
Research instrument
A close friend questionnaire was constructed for my survey. A Questionnaire
consisting of a set of questions was presented to respondents for their answers.
Sampling method: here I have used convenience non probability sampling
method.
a.) Sampling Plan
The sampling plan calls for three decisions.
i. Sampling unit: Who is to be surveyed?
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The target population must be defined that has to be sampled. It is necessary so as to
develop a sampling frame so that everyone in the target population has an equal
chance of being sampled. The sampling unit of this project was Customer who is
using CFL.
ii. Sample frame: Where is to be survey?
Sampling frame must be well defined. The sampling frame of this survey is Surat
city.
iii. Sample Size: How many people have to be surveyed?
Generally large sample gives more reliable results than small samples. The sample
consisted of 100 respondents. The sample was drawn from 100 end user’s customers’
people having different educational qualifications, occupations and age group. The
selection of the respondents was done on the basis of simple random sampling. The
sample was drawn from people having different educational qualifications, occupation
and age groups.
Contact Methods
Once the sampling plan has been determined, the question is how the subject should be
contracted i.e. by telephone, mail or personal interview. Here in this survey, I have
contacted the respondents through personal interviews and mail.
Collecting the information
The collection of data is a tedious task. For conducting any sort of research data
was needed. So for my research, there was plenty of primary data and for
increasing the validity of information collected, some books, journals, pamphlets,
information about the company were studied and taken into considerations. After
this, I have collected the information from the respondents with the help of
questionnaire.
a) Collection of Primary Data: Primary Data is the data collected from the
original source. In my survey and study, there was optimum availability of
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primary data because every aspect was witnesses carefully at each point.
Questionnaire and personal interviews and mail survey were the main
instruments, which were used for collecting primary data.
b) Collection of Secondary Data: Secondary Data is the one which has already
been collected by someone else and some other person is using that
information. The source of secondary data was, some related books and
websites related to the company. The competent staff of the company helped
me a lot in providing information about the company.
Analyse the Information
The next step is to extract the pertinent findings from the collected data. I have
tabulated the collected data and developed frequency distributions. Thus the whole
data was grouped aspect wise and was presented in tabular form. Thus, frequencies
and percentages were prepared to render impact of the study.
Presentation of findings:
This is the last and important step in the research process. The findings are
presented in the form of graphs, pie charts, conclusions, suggestions and
recommendations after data analysis.
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LIMITATIONS OF THE STUDY
1) The possibility of respondent’s responses being biased cannot be ruled out.
2) Limited access to secondary data pertaining to Philips performance in other
regions or any other information was another problem in finding a correct
response.
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3) Since a smaller sample was chosen so it may not be true representative of
population under study.
4) Most of the times people don’t give appropriate information.
5) Mostly respondent don’t want to give accurate information and act rudely.
6) The survey was to be conducted in a limited span of time (6 weeks) which also
posed a limiting factor.
7) The retailers are so busy in their business so that they did not show actual
picture of the situation.
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Chapter-5
Data Analysis and
Interpretation
ANALYSIS OF THE QUESTIONNAIRE
As the consumers play a key role in the today’s market; their preferences, attitude and
perceptions are of utmost value to the marketers keeping all the objectives of the study
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in mind and to give a proper dimension to the study undertaken, a comprehensive
consumer survey was undertaken with the aid of a well-framed questionnaire.
1. OCCUPATION CONSIDERED
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This question was put forwarded to extract a profile factor of the respondent. The
prime objective of this question was to know the occupation of the respondent.
Though this it can be analysed that which segment of people have like for which
brands. This question helped to extract the background of the customers owning and
not owning cars.
Table No. 1.1Occupation Percentage
Service 7%
Business 60%
Students 33%
Diagram 1.1
Interpret: The respondent for this survey was totally 100. More of the respondent
was from business sector followed by students and service people. 60% people was
from the business sector, 33% respondent is student and 7% is of service sector.
2. AGE GROUP
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The age group, which is one of the important roles in the buying behaviour of the
customer, was extracted through this question. It was attempted to cover most of the
age groups in various slabs.
Table No. 1.2
Age groups Percentage
15-24 20%
25-34 28%
35-44 40%
45 And Above 12%
Diagram 1.2
Interpret: The respondent for this survey was randomly selected, the most of the
respondent 40% was ranged between the age 35- 40 years, followed by the 25-44 years
contributing 28%.
3. ARE YOU AWARE ABOUT CFL?
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This question was asked to know whether respondent are aware about the CFL and various brand available in market. Most of the respondents are aware about the CFL and its brand.
Table No. 1.3Percentage
YES 98%
NO 2%
Diagram 1.3
Interpret: In this survey most of the respondents are aware of the CFL and its
Brand. 98% respondent knows about the CFL and its different brand available in the
market.
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4. MEDIA INSTRUMENT FOR AWARNESS
An endeavour was made to know the source of information or the awareness of
different brands of existing CFL in the market of Surat, to the customers. To respond
to this query, respondents were opted with various sources of media.
Table No. 1.4
Media Percentage
Newspapers 50%
Magazines 25%
T.V. Advertisement 87%
Trade Fairs 20%
Friends 45%
Diagram 1.4
Interpret: T.V. add is the main source in the awareness of the CFL i.e. near about
87%. Respondent knows about CFL from different various sources all along with T.V.
add.
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5. DO YOU PRUCHASE CFL?
Ownership of CFL was the chief extraction of this question. To this question only
few of the respondents were found positive whereas the remaining were not in
possession of a CFL.
Table No. 1.4
Percentage
Yes 94%
No 6%
Diagram 1.4
Interpret: Possession of the CFL, 94% respondent use CFL. Well the respondent
says no i.e. 6% people doesn’t need to purchase CFL.
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6. WHICH BRAND CFL YOU PREFER?
The respondents in response to this question revealed the awareness about the
existing brands of CFL in the market and the preference regarding existing brands.
To reveal it, they were given options of various brands that are playing in the
market of Surat.
Table No. 1.6
Brands Percentage
Philips 97%
Bajaj 15%
Surya 28%
Wipro 2%
Orpat 35%
Other 50%
Diagram 1.6
Interpret: Philips has the highly prefer by the respondent i.e. 97%, respondent all
use various brand along with different brand.
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7. WHO IS THE DECISION MAKER IN YOUR HOME
REGARDING CFL?
A major factor “Influence”, which induces a person to buy anything (herein referred
to CFL), was revealed by the respondents through their response to this question.
Decision maker regarding to the survey are mostly themselves.
Table No. 1.7
Percentage
Self 54%
Parents 15%
Any one in family 31%
Diagram 1.7
Interpret: 54% of the respondent are themselves take decision regarding buying of
CFL.31% respondent says that anyone can purchase the CFL.
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8. FOR WHAT PURPOSE YOU USE IT?
It is important to know that where the product is used and in which segment. This
question helps to know the area where the CFL is used and in which segment i.e.
Household and Industrial unit or Business purpose.
Table No. 1.8
Segment Percentage
Household 78%
Industrial 2%
Both 20%
Diagram 1.8
Interpret: 78% respondent use the CFL for their household purpose, while 20%
respondent says that they use it for both industrial as well as household purpose.
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9. WHERE DO YOU PURCHASE CFL?
Place is the most important thing to study the consumer buying behaviour. Place can
be determine, where consumer buy the product i.e. easily available. CFL are purchased
from the Kirana stores, Malls, Dealer outlets and wholesale distributors.
Table No. 1.9
Place Percentage
Kirana stores 12%
Malls 27%
Dealer outlets 48%
Wholesaler 13%
Diagram 1.9
Interpret: Purchase place is important, 48% respondent purchase the CFL from the
dealer outlets, followed by the malls 27% respondent.
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10.WHICH IS THE MAIN CRITERIA FOR YOUR PURCHASE?
In the consumer buying behaviour, the criteria play a vital role in the decision
regarding the product. For studying the consumer behaviour there main principal is to
be studied that why they are purchasing the product.
Table No. 1.10
Percentage
Brand Image 10%
Quality Light 36%
Price 20%
Energy Saving 30%
Guarantee 4%
Diagram 1.10
Interpret: Respondent main criteria regarding CFL is the quality light 36%
respondent says, after that energy saving 30% and the price 20% is the main criteria
for purchasing CFL.
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11.HOW MANY CFL ARE CURRENTLY INSTALLED IN YOUR
HOME?
This question is asked to know the number of CFL is installed in the respondent home.
This question helps to know the purchasing power and the quantity purchase by the
respondent.
Table No. 1.11
Percentage
1 to 3 71%
4 to 6 15%
7 to 9 9%
More than 9 5%
Diagram 1.11
Interpret: Currently 71% respondent use the 1 to 3 number of CFL in their Home as
well as Industrial use. Followed by the 15% respondent 4 to 6 CFL and 9% 7 to 9
qualntity.
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12.ACCORDING TO YOU, HOW LONG DOES CFL WORK?
This question helps you to know the working time of the product. CFL mainly last 18
months if it works regularly 10 hours daily.
Table No. 1.12
Months Percentage
0 to 6 2
7 to 12 22
13 to 18 40
19 to 24 20
More than 24 16
Diagram 1.12
Interpret: 40% of the respondent says that CFL last 13 to 18 months, while 20 %
respondent says that it last approx. 2 years.
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13.WHICH COLOUR LIGHTING YOU PREFER THE MOST?
This question helps to determine the respondent response regarding the preference of
the light of the CFL.
Table No. 1.13
Colour Percentage
White 60%
Yellow 20%
Off-white 10%
Others 10
Diagram 1.13
Interpret: 60% respondent prefer white colour lighting of the CFL. While 20%
respondent says that the lighting should be in the yellow colour.
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14.WHICH ATTRIBUTE IS IMPORTANT TO YOU BEFORE
DECIDE TO BUY CFL?
This question was attempted to extract the factors, which plays a major role in the
buying behaviour of the customers. All the factors were found to be important as well
as very important for the respondents.
Table No. – 1.14
SR.
No.
Attributes Very
Important
Important Not so
importan
t
a) Price 73 25 2
b) Brightness 60 35 5
c) Energy efficiency 57 33 10
d) Style / looks 7 38 55
e) Durability 33 34 33
f) Brand image 26 50 24
g) Replacement Policy 50 34 16
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Diagram 1.14
Interpret: Energy efficiency, brightness and the price is the most important factor
which is taken into consideration before buhying the CFL.
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FACTS AND FINDINDS
My analysis was undertaken for analysing and knowing the consumer buying pattern
for CFL’s and to know the preference of the customers towards Philips CFL’s.
From the above analysis I found out that:
1. The customer is firstly unaware regarding the efficiency of CFL’s.
2. The Consumers who buy CFL’s are mostly aged between 35-44 yrs.
3. Philips has very high brand recognition for its CFL’s.
4. Price is the very important aspect followed by the quality lighting for the
preference of the CFL’s.
5. The consumer had various expectations and had a perceived image for CFL’s
and the various brands offering CFL’s.
6. The target audience for CFL’s is mostly Men aged between 35 -44 yrs.
7. The satisfaction level for Phillips CFL’s was comparatively more than any
other CFL’s.
8. Due to a great impact of Modern Trade today people prefer to buy CFL’s
mostly from Dealer Outlets and then closely followed by Malls.
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Chapter-6
Conclusion and Suggestion
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SUGGESTIONS
1) More local/ regional advertisements should be there to make people aware
about Philips and its products.
2) Campaigning should be done at all level.
3) Business Development Officers should contact Dealers and Customers on
regular basis.
4) More flexible pricing schemes should be provided.
5) Company should further reduce its price.
6) There is more need in improvement of quality of Philips CFL so that it
decreases the rate of replacement.
7) If company backs out any scheme, then it should give some time to the retailer.
8) Provide updated information and knowledge to the retailers about the product.
9) Company should provide CFL in more attractive and Style / Look should
improve.
10) Company should increase the more energy efficiency of the CFL.
CONCLUSION OF THE ANALYSIS
From the above analysis and findings thereby, the company has definitely a good
market share and the customer base is in growing. Thought it faces a stiff competition
from reputed brands like Surya, Orpat etc. the company has its own set of customer
base. If the company directs some more efforts towards the advertising and changing
pricing policy of its CFL’s the company can definitely capture a greater market share.
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BIBLIOGRAPHY
Books:
1. Marketing Management – Philip Kotler
2. Research Methodology – G.C.Beri
3. Research Methodology – Schinder and Cooper
Internet:
1. www.india. philips .com
2. www.lighting. philips .co.in
3. www. wikiswot .com
4. https:// docs . google .com
5. www. wikipedia .org
6. www.marketingpractice.blogspot.com
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ANNEXURE
Questionnaire
Dear Sir/madam,
I am a BBA student from Bhagwan Mahaveer College of Business Administration (B.M.E.F),
Surat and doing a project on Consumer Buying Behaviour of Phillips CFL (Compact
Fluorescent Lamps). Your response is highly valuable. I would be grateful if you could help
me by filling it up honestly and legitimately. I assure that any information provided will be
solely used for academic purpose and will be kept confidential. No answers are right or wrong;
give the answers which you feel are the best.
PERSONAL DETAIL:
NAME: CONTACT NO:
AGE: ADDRESS:
OCCUPATION:
1) Are you aware about CFL (Compact Fluorescent Lamps)?
[ ] Yes [ ] No
2) How did you aware of the different brand of CFL?
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[ ] Newspaper [ ] Magazine [ ] T.V. add
[ ] Trade fairs [ ] Friends
3) Do you purchase CFL?
[ ] Yes [ ] No
4) Which brand CFL’s you are using?
[ ] Phillips [ ] Bajaj [ ] Surya
[ ] Wipro [ ] Orpat [ ] Others
5) Who is the decision maker in your home regarding CFL?
[ ] Self [ ] Parents [ ] Any one
6) For what purpose you use it?
[ ] Industrial [ ] Household [ ] Both
7) Where do you buy CFL’s mostly?
[ ] Kirana Store [ ] Malls [ ] Dealer Outlets
[ ] Whole seller
8) How many number of CFL’s currently installed in your home?
[ ] 1 to3 [ ] 4 to 6 [ ] 7 to 9 [ ] More than 9
9) What are the main criteria for your purchase?
[ ] Brand Name [ ] Quality Light [ ] Price
[ ] Energy saving [ ] Guarantee
10) According to you, how long does CFL last?
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11) What colour should lighting be?
[ ] White [ ] Yellow [ ] Off-white [ ] Other
12) Which attribute is important to you before decide to buy CFL?
Very Important Important Not so Important
Price [ ] [ ] [ ]
Brightness [ ] [ ] [ ]
Energy efficient [ ] [ ] [ ]
Durability [ ] [ ] [ ]
Brand image [ ] [ ] [ ]
Replacement [ ] [ ] [ ]
13) Would you like to give any suggestion?
THANK YOU!
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