2. Dissertation Report On
Buying Behavior of
FMCG Products
Submitted To:
Submitted By:
Prof. R.P.Singh
Vandana Chandra
Director (ABS) MBA
(Agri-Business)
AMITY University
AMITY University
Lucknow Campus
Lucknow Campus
Under the supervision of:
Mr. Ashish Chandra
2
3. Faculty Guide (ABS)
AMITY University
Lucknow Campus
Acknowledgement
I consider my proud privilege to express deep sense of
gratitude to Prof. R.P.Singh for his admirable and valuable
guidance, keen interest, encouragement and constructive
suggestions during the course of the project.
I would also like to express my hearty gratitude
to my faculty guides, Dr. Arun Bhadauria and Mr. Ashish
Chandra of Amity University, Lucknow for their valuable
guidance and sincere cooperation, which helped me in
completing this summer project.
I would also like to thank my mother Mrs. Usha Rani
and my father Mr. Ramesh Chandra, for their inspiration
and moral support received in completing this work.
Last, but not the least, I sincerely thank all the
members of my department for their immense support and
assistance extended during the course of this project and in
making it a valuable experience.
Vandana Chandra
MBA (Agri - Business)
IVth
Semester
3
4. Table of Content
1. Executive summary
1-1
2. Introduction
2-3
3. Overview of FMCG
3
4. FMCG in 2006
4
5. Comparison between FMCG in 2005 & 2006
4-5
6. Sector’s outlook
5-7
7. Scope of FMCG
8
8. Growth prospects
8-11
9. Top players in FMCG sector
11
4
5. 10. Secondary players
12
11.Review of literature
12-14
12. Research objectives
15
13.Research methodology
16-19
14.Panoramic View
20-22
15. Income based classification
23-24
16.Socio – economic classification
25-28
17.Age demographics
28-29
18. Geographical dispersion
30
19. Analysis
31-60
20.Conclusion
61-62
21.Suggestions & recommendations
63
22.References
64-65
5
6. 23.Questionnaire
66-68
Executive Summary
In this research the researcher has put an effort to
understand the buying behavior of the consumers towards
FMCG products.
1. In this report, the researcher has first of all given a
brief review about FMCG sector as a whole.
2. Then she has given a review of the findings of some of
the researches that has already been conducted by
various researchers.
3. Then she has enumerated her research objectives.
4. Then she has given the panoramic view regarding the
topic.
5. Then she has described her research methodology i.e.,
the sample unit, sample size, sampling region,
sampling procedure that she has used in her report.
6. She has used stratified random sampling as her
sampling procedure.
7. Then she has analyzed the data which was collected
by a questionnaire.
8. Then she has concluded the findings of the survey.
9. Then finally, she has given few suggestions &
recommendations regarding the topic.
6
7. Introduction
There was a time when the FMCG companies
ignores rural market, they took no any interest to produced
or sell products in rural market in India. It was the initial
stage of FMCG companies in India. As per as the time had
passed, the strategy and marketing style of FMCG
companies had been changed.
The rural market is the one of the best
opportunity for the FMCG sector in the India. It is wider and
less competitive market for the FMCG. As the income level of
the rural consumers increasing, the demand of FMCG is
increasing continuously.
Fast moving consumer goods (FMCG) are
popularly named as consumer packaged goods. Items in this
category include all consumables (other than
groceries/pulses) people buy at regular intervals. The most
common in the list are toilet soaps, detergents, shampoos,
tooth paste, shaving products, shoe polish, packaged food
stuff, household accessories, extends to certain electronic
7
8. goods. These items are meant for daily or frequent
consumption & have a high return.
A major portion of the monthly budget of each
household is reserved for FMCG products. The volume of
products circulated in the economy against FMCG products is
very high, as the number of products the consumer uses, is
comparatively very high. Competition in FMCG sector is very
high resulting in high pressure on margins.
FMCG companies maintain intense distribution
network. Companies spend a large portion of their budget on
maintaining distribution networks. New entrants who wish to
bring their products in the national level need to invest huge
sums of money on promoting brands. Manufacturing can be
outsourced. A recent phenomenon in the sector was entry of
multinationals and cheaper imports. Also the market is more
pressurized with presence of local players in rural areas and
state brands.
Overview of FMCG Sector
FMCG is an acronym for Fast Moving Consumer
Goods, which refer to things that we buy from local
8
9. supermarkets on daily basis, the things that have high
turnover & are relatively cheaper.
FMCG in 2006
After 4 years of dull performance in both revenues
& profits, FMCG sector has now, i.e., since 2005, gained the
momentum, principally because of the smaller companies
that have substantially improved their market shares at the
cost of larger players, & in some cases, the regional players.
If we carefully observe the FMCG index & BSE index,
we would realize that the returns on money invested in
FMCG index are much lower than the returns in benchmark
index. The FMCG sector has under performed the benchmark
BSE sensex in 2006. Though both the indices were close to
each other till august 2006, however, in the later part of the
year the sensex surpassed the FMCG index by a reasonable
margin.
9
10. Comparison of 2006 and 2005
After two years of sinking performance of
FMCG sector, the year 2005 has witnessed the FMCG’s
demand growing. Strong growth was seen across various
segments in FY06. With the rise in disposable income and
the economy in good health, the urban consumers continued
with their shopping spree. The rural demand grew at around
11%, while both the urban and rural sector together
registered a growth of around 8%. Packets and sachets
contributed to the highest growth in rural areas. Growth
in FMCG depends on two factors:
• Increase in penetration and consumption in rural areas
• Change in aspirations and tastes of the urban
population
Both these factors contributed to growth in 2006.
Besides demand, prices also increased, because of which
only the selected consumers moved up in the value chain.
The large format retail stores in metros also stimulated sales,
even if on a very small base. Some companies absorbed
higher input prices, while others were able to pass on the
cost to the consumers.
10
11. Sector’s Outlook
FMCG is the fourth largest sector in the Indian Economy with
a total market size of Rs.60,000 crores. FMCG sector
generates 5% of total factory employment in the country and
is creating employment for three million people, especially in
small towns and rural India.
According to a CII – A T Kearney Report, the FMCG sector in
India is expected to grow at a compounded growth rate
(CAGR) of 9% to a size of Rs.1,43,000 crores by 2010 from
Rs. 93,000 crores at present.
With a growth of 52.5%, the BSE FMCG index has, during the
last 1 year outperformed the sensex, which could manage a
growth of 41% only. A well established distribution network,
intense competition between the organized & unorganized
segments, low operating costs, strong branding
characterizes the market.
The large consumer base, particularly in rural sector, and the
growing middle class open up huge opportunities to FMCG
companies to take the consumers to branded products and
offer new generation products.
The sector's lack-luster performance in the last few years
11
12. was due to price competition and increase in raw materials
cost. However, in the FY06, the sector has witnessed a
double-digit growth in profits and revenues. The sector has
registered an up trend in growth across categories, such as
health supplement, shampoo, toothpaste, hair oils, and
mosquito repellant, as shown in table below:
Sales Value Growth %
Categories 2004-2005 2005-2006 Apr.2006-
Sept. 2006
Health
Supplement
(Chyawanprash)
-5% 0% 23%
Shampoo 10% 23% 19%
Toothpaste 5% 6% 16%
Hair Oils 9% 18% 23%
Mosquito 13% 10% 29%
12
13. Repellant
Source: CII – A T Kearney Report, (2000)
Sector Financials In millions
31-03-2006 31-03-2005 31-03-2004
Net Sales
Sales Growth
164,196
10.8%
148,241
2.0%
145,380
-
Profit after
Tax
PAT Growth
19,595
16.6%
17,001
-24.2%
21,008
-
Market
Capitalization
74,746 65,810 63,072
Enterprise
Value
662,540 645,477 551,971
Return on
Capital
Employed
(ROCE)
47.1% 51.0% 45.5%
P/E Ratio 26.7% 27.1% 21.0%
Source: CII – A T Kearney Report, (2000)
Scope of the FMCG Sector
The Indian FMCG sector has a market size of US $13.1 billion.
FMCG sector is expected to grow by over 60% by 2010. That
will translate into an annual growth of 10% over a period of 5
13
14. years. It has been estimated that FMCG sector will rise from
around Rs. 56,500 crores in 2005 to Rs. 92,100 crores in
2010. Hair care, household care, male grooming, female
hygiene, & the chocolates & confectionary categories are
estimated to be the fastest growing segments, says an
HSBC Report. Though the sector witnessed a slower growth
in 2002 – 04, it has been to make a fine recovery since then.
For example, Hindustan Levers Limited (HLL) has shown a
healthy growth in the last quarter. An estimated double-digit
growth over the next few years shows that the good times
are likely to continue.
Growth Prospects
With the presence of 12.2% of the world population in the
villages of India, the Indian rural FMCG market is something
no one can overlook. Increased focus on farm sector will
boost rural incomes, hence providing better growth
prospects to the FMCG companies. Better infrastructure
facilities will improve their supply chain. FMCG sector is also
likely to benefit from growing demand in the market.
Because of the low per capita consumption for almost all the
products in the country, FMCG companies have immense
possibilities for growth. And if the companies are able to
14
15. change the mindset of the consumers, i.e. if they are able to
take the consumers to branded products and offer new
generation products, they would be able to generate higher
growth in the near future. It is expected that the rural
income will rise in 2007, boosting purchasing power in the
countryside. However, the demand in urban areas would be
the key growth driver over the long term. Also, increase in
the urban population, along with increase in income levels
and the availability of new categories, would help the urban
areas maintain their position in terms of consumption. At
present, urban India accounts for 66% of total FMCG
consumption, with rural India accounting for the remaining
34%. However, rural India accounts for more than 40%
consumption in major FMCG categories such as personal
care, fabric care, and hot beverages. In urban areas, home
and personal care category, including skin care, household
care and feminine hygiene, will keep growing at relatively
attractive rates. Within the foods segment, it is estimated
that processed foods, bakery, and dairy are long-term growth
categories in both rural and urban areas.
Indian Competitiveness and Comparison with the World
Markets:
The following factors make India a competitive player in
FMCG sector:
15
16. 1. Availability of raw materials
Because of the diverse agro-climatic conditions in India,
there is a large raw material base suitable for food
processing industries. India is the largest producer of
livestock, milk, sugarcane, coconut, spices and cashew and
is the second largest producer of rice, wheat and fruits
&vegetables. India also produces caustic soda and soda ash,
which are required for the production of soaps and
detergents. The availability of these raw materials gives
India the location advantage.
2. Labor cost comparison
16
17. Low cost labor gives India a competitive advantage. India's
labor cost is amongst the lowest in the world, after China &
Indonesia. Low labor costs give the advantage of low cost of
production. Many MNC's have established their plants in
India to outsource for domestic and export markets.
3. Presence across value chain
Indian companies have their presence across the value chain
of FMCG sector, right from the supply of raw materials to
packaged goods in the food-processing sector. This brings
India a more cost competitive advantage. For example, Amul
supplies milk as well as dairy products like cheese, butter,
etc.
Top Players in FMCG Sector
1. Hindustan lever limited (HLL)
2. ITC (Indian Tobacco Company)
3. Nestle India
4. GCMMF (AMUL)
5. Dabur India
6. Asian Paints (India)
7. Cadbury India
8. Britannia Industries
9. Procter & Gamble Hygiene & Health Care
10. Marico Industries
17
18. Secondary Players
1. Colgate-Palmolive (India) Ltd.
2. Godrej Consumers Product Ltd.
3. Nirma Ltd.
4. Tata Tea Ltd.
5. Parle Agro
6. H. J. Heinz
Review of Literature
Rural market is one of the best
opportunities for the FMCG sector. In some sense we can say
that rural market is future of FMCG.
1. Basu Purba (2004), suggested that the lifestyle of
rural consumers is changing. Rural Indian market and the
marketing strategy have become the latest marketing
buzzword for most of the FMCG majors. She added the
strategies of different FMCG companies for capturing rural
market like Titan’s Sonata watches, Coco Cola’s 200ml
18
19. bottle, different strategies of HUL and Marico etc. She takes
into consideration the study of National Council for Applied
Economic Research (NCAER). According to the NCAER
projections, the number of middle and high-income
households in rural area is expected to grow from 140 million
to 190 million by 2007. In urban India, the same is expected
to grow from 65 million to 79 million. Thus, the absolute size
of rural India is expected to be double that of urban India.
2. Tognatta Pradeep (2003), suggested that, the
economic growth in India's agricultural sector in last year
was over 10%, compared with 8.5% in the industrial sector.
This implies a huge market potentiality for the marketer to
meet up increasing demand. Factors such as village psyche,
strong distribution network and market awareness are few
prerequisites for making a dent in the rural markets. The
model is of the stolid Anglo-Dutch conglomerate Unilever
Group, which has enjoyed a century-long presence in India
through its subsidiary Hindustan Lever Ltd. It was Hindustan
Lever that several years ago popularized the idea of selling
its products in tiny packages. Its sachets of detergent and
shampoo are in great demand in Indian villages. Britannia
with its low priced Tiger brand biscuits has become some of
the success story in rural marketing.
19
20. 3. Aithal, K Rajesh (2004), suggested that rural
markets are an important and growing market for most
products and services including telecom. The characteristics
of the market in terms of low and spread out population and
limited purchasing power make it a difficult market to
capture. The Bottom of the pyramid marketing strategies
and the 4 A's model of Availability, Affordability,
Acceptability and Awareness provide us with a means of
developing appropriate strategies to tackle the marketing
issues for marketing telecom services in rural areas.
Successful cases like the Grameen Phone in Bangladesh and
Smart Communications Inc in Philippines also provide us with
some guidelines to tackling the issue.
As per my concern of the research, it is a
detail study of different FMCG products used by rural
consumers. It will provide detail information about consumer
preferences towards a good number of FMCG products which
is too unique and different from those above researches.
20
21. Research objectives
• To understand the demand pattern of FMCG products in
the rural market.
• To know the amount of household income spent on the
consumption of FMCG products.
• To understand the image of the products in the eyes of
the consumers.
21
22. Research methodology
Data collection
Sample unit:
1. working people (including men & women)
2. college students
3. school students
4. senior citizens
Sample size:
1. working people: 32%
2. college students: 29%
3. school students: 23%
4. senior citizens: 16%
Sampling region:
22
23. 1. The researcher has selected LUCKNOW, the Capital city
of Uttar Pradesh as her area of study.
2. She has chosen GOMTI NAGAR, MAHANAGAR, ALIGANJ
as her areas of research. In these areas she can easily
meet working people (both male & female), school
students, college students & senior citizens.
The population status of these areas can be shown in a
tabulated manner, which is given as follows:
Area Population
Gomti Nagar 12,97,570
Mahanagar 8,12,230
Aliganj 8,75,640
Population is in approximate figures.
Source:
http://www.upgov.nic.in/upinfo/census01/cen01-1.htm
Note: As the examiner can see that the population of
areas (areas that are chosen by the researcher) is very
large, therefore the researcher has stratified the area. She
has chosen various areas that come under these areas.
The areas covered by the researcher in Gomti Nagar are
Viram Khand, Vinamr Khand, Vibhuti Khand . the
population level of these areas are:
Area Population
Vishwas Khand 2,83,563
Vipul Khand 3,93,768
Vivek Khand 2,86,786
23
24. Source: Lucknow Development Authority
Note: the researcher took these areas because these
areas are near to various school & colleges. The
researcher took school & college students as her sample
unit.
The areas covered by the researcher in Maha Nagar are
Chandra Lok & Mahanagar Colony. The population
statuses of these areas are:
Area Population
Chandra Lok 2,34,863
Mahanagar Colony 3,84,683
Source: Lucknow Development Authority
Note: The researcher took these areas because there are
various schools & institutes nearby these places.
The areas covered by the researcher in ALIGANJ are
Jankipuram & Sahara City. The population statuses of
these areas are:
Area Population
Jankipuram 2,78,675
Sahara City 1,89,986
Source: Lucknow Development Authority
24
25. Note: The researcher took Aliganj as one of the areas for
her study because she lives in jankipuram & it was quite
easy for her to conduct the survey in that particular place.
Sampling procedure:
The researcher will take stratified random sampling as
the sampling procedure.
Data collection method:
1. Primary data: it will be collected with the help
of a self administered questionnaire. This questionnaire
aims to gather information related to various Branded
products.
2. Secondary data: it will be collected with the
help of books, research papers, magazines, news
papers, journals, internet, etc.
Research instruments:
Questionnaire design:
As the questionnaire is self administrated one, the survey is
kept simple and user friendly. Words used in questionnaire
25
26. are readily understandable to all respondent. Also technical
jargons are avoided to ensure that there is no confusion for
respondents.
Panoramic View
India has a population of over 1 billion & 4 climatic
Zones. Several religious & personal beliefs, 15 languages,
different social customs & food habits categorize Indian
consumer class. Besides this, India is also different in culture
if compared with other Asian countries. Therefore, India has
high distinctiveness in demand and the companies in India
can get lot of market opportunities for various classes of
consumers. Consumer goods marketers’ experience that
dealing with India is like dealing with many small markets at
the same time.
Indian consumer goods market is expected to
reach $400 billion by 2010. India has the youngest
population amongst the major countries. There are a lot of
young people in India in different income categories.
26
27. Consumer goods marketers are often faced with a
dilemma regarding the choice of appropriate market
segment.
In India they do not have to face this dilemma
largely because rapid urbanization, increase in demand,
presence of large number of young population, any number
of opportunities is available. The bottom line is that Indian
market is changing rapidly and is showing unprecedented
consumer business opportunity.
As the restrictions on foreign investments were relaxed in
1991, Multi-National Companies have been entering India
since then.
Market
Size in $
million
Market Share
in %
15
Indian
Compan
ies
MNCs
Indian
Compan
ies
MNCs
1992 2004 1992 2004
Breakfa
st
cereals
2 25 100 0 52 48
Wafers,
potato
chips
6 35 100 0 37 63
27
28. Washin
g
Machin
es
40 570 98 2 51 49
TV 630
3,03
0
97 3 49 51
1992 $=30 rupees
2004 $=45 rupees
Source: Center for Monitoring Indian Economy (CMIE)
With a population of 1 billion people,
India is a big market for FMCG companies. Around 70% of
the total households in India reside in the rural areas. The
total number of rural households is expected to rise from
135 m in 2002 to 153 m in 2010, which represents the
largest potential market in the world.
Rural and urban potential
U
rban
Rural
Population 2001-02 (m
household)
53 135
Population 2009-10 (m
household)
69 153
% Distribution (2001-02) 28 72
Market (Towns/Villages)
3,76
8
627,0
00
28
29. Source: Statistical Outline of India (2001-02), NCAER
Indian consumer class can be classified
according to the following criteria:
1. Income
2. Socio-Economic status
3. Age demographics
4. Geographical dispersion
Income based classification
India has a population of 1.095 billion people,
comprising of 1/6th of the world population. India's
population can be divided into 5 groups on the basis of
annual household income. These groups are:
29
30. 1. Higher income
2. Upper middle income
3. Middle middle income
4. Lower middle income
5. Lower income
The income classification does not represent a real
scenario for an international business because the
purchasing power of currencies differs significantly. The real
purchasing power of Indian rupee is higher than the
international exchange value.
In addition to that, income classification is not
an effective tool to ascertain consumption and ownership
trends in the economy.
Consumer Classification
According to National Council of Applied Economic Research
(NCAER) there are 5 consumer classes that differ in their
ownership patterns and consumption behavior across
various segments of goods.
Consumer
Classes
Annual
Income in Rs.
1
996
2001
2
007
Change
30
31. The Rich
Rs. 215,000
and more
1.2 2.0 6.2 416%
The
Consuming
Class
Rs 45-
215,000
32.5 54.6 90.9 179%
The
Climbers
Rs. 22-
45,000
54.1 71.6 74.1 37%
The
Aspirants
Rs. 16-
22,000
44 28.1 15.3 -65%
The
Destitute
Below Rs.
16,000
33 23.4 12.8 -61%
Total
164.
8
180.7
199.
2
21%
Source: NCAER
The 5 classes of consumer households
(consumer classification) show the economic development
across the country based on consumption trends.
Socio economic classification
In addition to income classification and
consumer classification, Indian households can also be
31
32. segmented according to the occupation and education levels
of the chief earner of the household (the person who
contributes most to the household expenses). This is called
as Socio-economic Classification (SEC), which is mainly used
by market planners to target market before launching their
new products. SEC is made to understand the purchase
behavior and the consumption pattern of the households.
The urban area is segregated into: A1, A2, B1, B2, C, D, E1,
E2
Socio-Economic Classification
Occupati
on
Education
Illitera Less 5-9 School S Gradu Post-
32
33. te
than
4 yrs
in
scho
ol
yrs
of
scho
ol
certific
ate
ome
colle
ge
ate
gradu
ate
Skilled E2 E1 D C C B2 B2
Unskilled E2 E2 E1 D D D D
Shop
owner
D D C B2 B2 A2 A2
Petty
trader
E2 D D C C B2 B2
Employer of-
Above 10
persons
B1 B1 A2 A2 A1 A1 A1
Below 10
persons
C B2 B2 B1 A2 A1 A1
None D C B2 B1 A2 A1 A1
Clerk D D D C B2 B1 B1
Supervis
or
D D C C B2 B1 A2
Professio
nal
D D D B2 B1 A2 A1
Senior
executiv
e
B1 B1 B1 B1 A2 A1 A1
Junior
executiv
e
C C C B2 B1 A2 A2
Source: Indian readership survey (IRS)
Sections A & B refer to High-class- constitutes over a
quarter of urban population
Sec C refers to Middle-class-- constitutes 21% of the
urban population
33
34. Sections D & E refer to Low-class-- constitutes over
half the urban
population
To understand the table, consider an example: A trader
whose monthly household income (MHI) is more than that of
a person in section A cannot be included in this SEC because
his educational qualification or occupations do not qualify
him for inclusion.
Sec C constitutes households whose Chief Wage Earners are
employed as:
Skilled workers 33%
Petty traders 12%
Clerk/Supervisor 37%
Shop owners 18%
3/4th of them have studied till 10th or 12th class while the
remaining 1/4th have studied till 9th class.
Less than half of the Chief Wage Earners of households
belonging to sections D & E are unskilled workers. Petty
Traders are 18%, while Skilled Workers are about 28%.
More than 80% of the population of upper strata
consumers is living in the top 7 cities. Those top 7 cities are
Mumbai, Kolkata, Delhi, Chennai, Ahmedabad, Bangalore,
and Hyderabad. With increase in economic prosperity, this
population (upper strata consumers) is growing at 10
percent annually.
34
35. The rural area is segregated in to: R1, R2, R3, R4.
Education
of chief
wage
earner
Type of House
Pucca
Semi-
pucca
Kuchcha
Profession
al degree
R1 R2 R3
Graduation
/ PG
R1 R2 R3
College R1 R2 R3
SSC/HSC R2 R3 R3
Class 4-
Class 9
R3 R3 R4
Up to class
4
R3 R3 R4
Self-
learning
R3 R4 R4
Illiterate R4 R4 R4
Age demographics
India is a very young nation, if compared with
some advanced and developed countries. Nearly two- thirds
of its population is below the age of 35, and nearly 50 % is
35
36. below 25.
Marketers explain that the boom in the consumption level
and leisure related expenditure is because of this young
population. It will have a significant impact over the
consumer goods market. In addition to that, it is expected
that this will generate trade opportunities and continuous
investment in the economy. There is huge potential for
further consumption of goods and services due to the
increased level of disposable income. The expenditure on
essential goods and services has a higher share in
developing countries as compared with that of developed
countries.
Age distribution if Indian population (In Millions)
Year/ Age 2006 2001 1996
Below 4 yrs 113.5 108.5 119.5
5-14 yrs 221.2 239.1 233.2
15-19 yrs 122.4 109.0 90.7
20-34 yrs 279.1 246.8 224
35-54 yrs 239.2 207.3 178.1
55 & above 118.7 101.7 88.7
Total 1094.1 1012.4 934.2
Consumption Trends
Food Essentials 45.68%
Essential Services
(water, power, rent, and
10.1%
36
37. fuels)
Clothing 4.9%
Footwear 0.63%
Medicare 4.25%
Transport &
Communication
14.51%
Recreation, Education,
and Culture
Less than 4%
Home Goods 3.25%
Geographical dispersion
There is large difference in economic prosperity levels
among several states in India, linked to the wealth creation
from trade, industrial, and agricultural development. There
are poor districts in many states, classified according to their
market potential. India has 500 districts, out of which 150
districts (category A) and next 150 districts (category B)
account for 78% and 15% of the national market potential
respectively. Remaining 200 districts (category C) are
backward and account for only 7% of national market
potential. Category C districts have 40% of the geographical
share.
37
38. Analysis
1. Which soap u prefer to use?
The reaction of people towards various SOAP brands
can be tabulated in the following manner:
Brands Lux Dettol Lifebuoy others
Percenta
ge
36 22 18 24
In the survey that the researcher conducted, it
could easily be concluded that LUX, the product of HUL was
highly in demand. LUX, the product of HUL covers 36% of the
market share. After LUX, the other brands (EXCEPT LUX,
DETTOL, LIFEBUOY) covers 24% of the market share. This is
then followed by DETTOL, the product of RECKITT BENCKISER
38
39. with a market share of 22%, which is then followed by
LIFEBUOY, the product of HUL with a market share of 18%.
This data can be graphically explained with the help of the
following bar graph:
39
41. distribute the consumers on the basis of their demand for
the various packs of SOAP brands available in the market.
However, the reaction of people towards various
packs of SOAP can be tabulated in the following manner:
Packs of soaps Single pack
Family pack (3 in
1)
Percentage 56 44
In the survey that the researcher conducted, she
tried to differentiate amongst people, with below average
household income, average household income & above
household income. This classification can be done on the
basis of the daily expenditure that people make. 56%
consumers demand single pack. 44% consumers demand
family packs i.e. 3 in 1 pack.
This data can be graphically explained with the help
of the following bar graph:
41
43. Brands Tata Tea
Brooke
Bond
Taj Mahal Others
Percenta
ge
32 28 18 22
In the survey that the researcher conducted, it
could easily be concluded that TATA TEA, the product of TATA
has a market share of 32%. This is followed by, BROOKE
BOND, with a market share of 28%. Followed by other brands
(EXCEPT TATA TEA, BROOKE BOND, TAJ MAHAL) with a
market share of 22%. This is finally followed by TAJ MAHAL,
the product of HUL which holds18% of the market share.
This data can be graphically explained with the help of the
following bar graph:
43
45. In order to determine the income pattern of the
consumers, it was necessary for the researcher to
distribute the consumers on the basis of their demand for
the various packs of TEA brands available in the market.
However, the reaction of people towards various TEA
packs can be tabulated in the following manner:
TEA packs Sachet
Medium
pack
Large pack
percentage 48 32 20
In the survey that the researcher conducted,
she tried to differentiate amongst the people, with below
average household income, average household income &
above household income. This classification can be done
on the basis of the daily expenditure that people make.
However, it can be concluded that sachets are most
commonly used by the people .i.e., 48% consumers
demand sachet packs. 32% consumers demand medium
pack.20% consumers demand large pack.
45
46. This data can be graphically explained with the
help of the following diagram:
0
10
20
30
40
50
percentage
packs preferredby customers
demandof tea packs
sachet
mediumpack
large pack
3. Which tooth paste u prefer to use?
46
47. In the initial years, the rural consumers
preferred tooth powders, datoons etc. But from the last
decade, the preference of consumers towards toothpaste
has been changed. A huge number of toothpastes of
different companies are sold in rural market.
However, the reaction of people towards various
TOOTH PASTES can be tabulated as follows:
Brands
Pepsoden
t
Colgate Close Up Others
Percenta
ge
27 35 22 16
In the survey that the researcher conducted, it could
easily be seen that COLGATE, the product of COLGATE
PALMOLIVE is the market leader, which covers 35% of the
total market. After that, PEPSODENT, the product of HUL is
demanded by the customers, which covers 27% of the
market share. Followed by CLOSE – UP, the product of HUL
is demanded by the customers, which covers 22% of the
market share. Which is then followed by others brands
(EXCEPT PEPSODENT, COLGATE, CLOSE - UP), which
covers 16% of the total market share.
47
48. This data can be graphically explained with the
help of the following bar graph:
0
5
10
15
20
25
30
35
percentage
brands
demandof toothpaste
pepsodent
colgate
closeup
others
48
49. 4. Which pack u prefer to use?
In order to determine the income pattern of the
consumers, it was necessary for the researcher to
distribute the consumers on the basis of their demand for
the various packs of TOOTH PASTE brands available in the
market.
However, the reaction of people towards various
TOOTH PASTE packs can be tabulated in the following
manner:
Tooth paste
pack
Small pack
Medium
pack
Family pack
Percentage 34 48 18
In the survey that the researcher conducted, she
tried to differentiate amongst the people, with below
average household income, average household income &
above household income. This classification can be done on
the basis of the daily expenditure that people make.
However, it can be concluded that 34% consumers demand
small packs. 48% consumers demand medium packs. 18%
consumers demand large pack.
49
50. This data can be graphically explained with the help
of the following graph:
0
10
20
30
40
50
percentage
packspreferredby customers
demandofpacksoftoothpaste
smallpack
mediumpack
family pack
50
51. 5. Which detergent u prefer to use?
The reaction of people towards various DETERGENT
brands can be tabulated in the following manner:
Brands Surf Rin Tide Others
Percenta
ge
27 35 22 16
In the survey that the researcher conducted, it
could be easily concluded that RIN, the product of HUL
captures 35% of the total market share. This is followed by
SURF, the product of HUL which has a market share of
27%. This is followed by TIDE, the product of PROCTER &
GAMBLE which has a market share of 27%. This is finally
followed by other brands (EXCEPT SURF, RIN, TIDE) which
captures 16% of the market share.
51
52. This data can be graphically explained with the
help of the following bar graph:
0
5
10
15
20
25
30
35
percentage
brands
demandof detergents
surf
rin
tide
others
52
53. 6. Which pack u prefer to use?
In order to determine the income pattern of the
consumers, it was necessary for the researcher to
distribute the consumers on the basis of their demand for
the various packs of DETERGENT brands available in the
market.
However, the reaction of people towards various
DETERGENT packs can be tabulated in the following
manner:
Detergent
packs
Sachet
Medium
pack
Family pack
Percentage 43 27 30
In the survey that the researcher conducted, she
tried to differentiate amongst the people, with below
average household income, average household income &
above household income. This classification can be done on
the basis of the daily expenditure that people make.
However, 43% consumers demand sachet packs. 30%
consumers demand family packs. 27% consumers demand
medium packs.
53
54. This data can be graphically explained with the
help of the following bar graph:
54
56. Brands
Clinic
plus
Sunsilk
Head &
shoulders
Others
Percenta
ge
33 25 28 14
In the survey, that the researcher conducted it
can easily be concluded that CLINIC PLUS, the product of
HUL, captures the major portion of the market with a market
share of 33%. This is followed by HEAD & SHOULDERS, the
product of PROCTER & GAMBLE which holds 28% of the
market share. This is followed by SUNSILK, the product of
HUL which holds 25% of the market share. Finally followed
by other brands (EXCEPT CLINIC PLUS, SUNSILK, HEAD &
SHOULDERS) with a market share of 14%.
This data can be graphically explained with the help of the
following bar graph:
56
58. In order to determine the income pattern of the
consumers, it was necessary for the researcher to
distribute the consumers on the basis of their demand for
the various packs of SHAMPOO brands available in the
market.
However, the reaction of people towards various
SHAMPOO packs can be tabulated in the following manner:
Shampoo
packs
sachet
Small
pack
Medium
pack
Family
pack
Percenta
ge
23 32 28 17
In the survey that the researcher conducted, she
tried to differentiate amongst the people, with below
average household income, average household income &
above household income. This classification can be done on
the basis of the daily expenditure that people make.
However, 32% consumers demand SMALL PACK. 28%
consumers demand medium pack. 17% consumers demand
large packs.
58
59. This data can be graphically explained with the
help of the following bar graph:
0
5
10
15
20
25
30
35
percentage
packspreferredby customers
demandof shampoopacks
sachet
smallpack
mediumpack
largepack
59
60. 9. Which biscuits u prefer to use?
The reaction of people towards various BISCUITS brands can
be tabulated in the following manner:
Brands
Marie
gold
Good Day Parle G Others
Percenta
ge
24 38 21 17
In the survey, that the researcher conducted, it can
easily be concluded that GOOD DAY, the product of
BRITANNIA holds a major market share of 38%. This is
followed by MARIE GOLD, another product of BRITANNIA
which holds 24% of the market share. After that, PARLE- G,
the product of PARLE, holds 21% of the market share. This is
followed by other brands (EXCEPT MARIE GOLD, GOOD DAY,
PARLE- G) which hold a market share of 17%.
60
61. This data can be graphically explained with the help of the
following bar graph:
0
5
10
15
20
25
30
35
40
percentage
brands
demandof biscuits
mariegold
goodday
parleG
others
61
62. 10.which hair oil u prefer to use?
The reaction of people towards various HAIR OIL brands can
be tabulated in the following manner:
Brands
Parachut
e
Dabur
Amla
Dabur
Vatika
Others
Percenta
ge
37 29 19 15
In the survey, that the researcher conducted, it can
easily be concluded that PARACHUTE, the product of MERICO
captures 37% of the total market share. This is followed by
DABUR AMLA, the product of DABUR which captures 29% of
the total market share. This is followed by DABUR VATIKA,
another product of DABUR which captures 19% of the
market. And after that, followed by other brands (EXCEPT
PARACHUTE, DABUR AMLA, DABUR VATIKA) captures 15% of
the market share.
62
63. This data can be graphically explained with the help of
the following bar graph:
0
5
10
15
20
25
30
35
40
percentage
brands
demandofhair oil
parachute
dabur amla
dabur vatika
others
63
64. 11. Which pack u prefer to use?
In order to determine the income pattern of
the consumers, it was necessary for the researcher to
distribute the consumers on the basis of their demand for
the various packs of HAIR OIL brands available in the
market.
However, the reaction of people towards
various HAIR OIL packs can be tabulated in the following
manner:
Hair oil
packs
Small pack Medium
pack
Large pack
Percentage 32 41 27
In the survey that the researcher conducted, she
tried to differentiate amongst the people, with below
average household income, average household income &
above household income. This classification can be done on
the basis of the daily expenditure that people make.
However, 41% consumers demand medium packs. After that,
32% consumers demand small pack. 27% consumers
demand large packs.
64
65. This data can be graphically explained with the help of the
following bar graph:
0
5
10
15
20
25
30
35
40
45
percentage
packspreferredby customers
demandof packsof hair oil
smallpack
mediumpack
largepack
65
66. 12. Which cream u prefer to use?
The reaction of people towards various CREAM brands can
be tabulated in the following manner:
Brands Pond’s
Fair &
lovely
Ayur Others
Percenta
ge
28 32 14 26
In the survey, that I conducted, it can easily be
concluded that FAIR & LOVELY, the product of HUL, holds the
major market with a share of 32%. This is followed by,
POND’s, another product of HUL, which holds 28% of the
market share. This is followed by, other brands (EXCEPT,
POND’s, FAIR & LOVELY & AYUR), which captures 26% of the
market share. This is followed by AYUR, the brand of AYUR
ACADEMY OF NATURAL BEAUTY (AANB) which holds 14% of
the total market share.
66
67. This data can be graphically explained with the
help of the following bar graph:
67
69. Brands Bru Nestle Nescafe Others
Percenta
ge
26 32 32 10
In the survey, that the researcher conducted, it can
be easily concluded that all the brands are facing tough
competition. NESTLE, the product of NESTLE S.A. &
NESCAFE, another product of NESTLE S.A., shares equal
market share of 32% each. This means that they are in a
very tough competition. This is followed by BRU, the product
of HUL which holds, 26% of the market share. While the
other brands hold only 10% of the market share.
This data can be graphically explained with the
help of the following bar graph:
69
71. shampoo & cream’s category. HUL’s products are mainly in
demand, because they provide these products in different
packs. They consider the fact that rural consumers do not
have that much money to be spent on these products. So,
they prefer buying the small or the medium packs. However,
large or family packs are still been bought by few
consumers, who are from a well – off families.
In the case of TEA, TATA holds a major share. In
the case of COFFEE, NESTLE & NESCAFE holds the major
share. Rural consumers favor TATA because it is an old
organization & it has gained a lot of BRAND EQUITY which
finally creates BRAND LOYALTY. In these products, consumers
do get brand loyal, because they do not want to take a risk
with their tastes. So they prefer sticking to one brand. These
organizations supply their products in various packs (small,
medium & large), considering the buying capacity of their
consumers.
As in the case of BISCUITS, BRITANNIA holds
the major market share. Rural consumers favor BRITANNIA
because it is an old organization & it has gained a lot of
BRAND EQUITY which finally creates BRAND LOYALTY. In case
of BISCUITS, consumers do get brand loyal, because they do
not want to take a risk with their tastes. So they prefer
sticking to one brand. These organizations supply their
71
72. products in various packs (small, medium & large),
considering the buying capacity of their consumers.
In the case of TOOTH PASTES, COLGATE
PALMOLIVE holds a major market share. Consumers are very
concerned about their health, so if any product suits them
they prefer sticking to that product. And this product is also
available in various packs, so rural consumers can use it
according to their buying capacity.
In the case of HAIR OILS, MERICO holds the
major market share. MERICO is a much known organization &
its product PARACHUTE has reached all the places. So it is a
known product, which has created a good amount of
goodwill for the organization. Consumers have confidence &
trust in their product. Therefore, they prefer buying it.
72
73. Suggestions & recommendations
The researcher would like to suggest the following points, so
that the organizations can easily sell their products to their
consumers:
1. However, the demand of a product is also affected by
its life cycle. If the product is in the introduction stage,
then it will definitely take some time to capture the
market, because in the introduction stage, consumers
are not much aware about the product. Therefore, it’s
the responsibility of the organization to create
awareness amongst the consumers.
2. They should adapt rigorous marketing strategies, in
order to sustain in the market.
3. There is immense competition in this sector. Therefore,
the organizations should try to gain competitive
advantage against their competitor’s.
4. They should try to reach as many people as possible.
5. For the organizations that are not much popular
amongst the consumers, should adopt Sales Promotion,
as their marketing strategies.
6. Application of 4A’s has also become an important task
for all the organizations.
73
74. (*4A= Availability, Affordability, Acceptability,
Awareness)
References
1. Kearney, A T, CII – Report, (2000)
2. Purba basu, research on living style of rural
consumers, (2004), pg. no. 5-8.
3. Tognatta Pradeep, economic growth on agriculture
sector, (2003), pg no. 6-10.
4. Aithal K Rajesh, importance & growth of rural
markets, (2004), pg no. 8-12.
5. Center for Monitoring Indian Economy (CMIE)
6. Statistical Outline of India (2001-02), NCAER
7. National Council of Applied Economic Research
(NCAER)
8. Indian readership survey (IRS)
9. http://www.upgov.nic.in/upinfo/census01/cen01-
1.htm
10.Lucknow Development Authority
11.http://www.naukrihub.com/india/fmcg/overview/
12.http://www.naukrihub.com/india/fmcg/
74
76. Questionnaire
1. name:
2. occupation:
3. monthly salary:
a. less than 10,000
b. 10,000 – 25,000
c. 25,000 – 50,000
d. More than 50,000
4. address:
5. phone no.:
6. which soap u prefer to use?
a. Lux
b. dettol
c. lifebuoy
d. others
7. which pack u prefer to use?
a. single
b. family pack ( 3 in 1)
8. which tea u prefer to use?
a. tata tea
b. brooke bond
c. taj mahal
d. others
9. which pack u prefer to use?
76
77. a. sachet
b. medium pack
c. large pack
10.which tooth paste u prefer to use?
a. pepsodent
b. colgate
c. close – up
d. others
11.which pack u prefer to use?
a. small pack
b. medium pack
c. family pack
12.which detergent u prefer to use?
a. surf
b. rin
c. tide
d. others
13.which pack u prefer to use?
a. sachet
b. medium pack
c. large pack
14.which shampoo u prefer to use?
a. clinic plus
b. sunsilk
c. head & shoulders
d. others
15.which pack u prefer to use?
a. sachet
77
78. b. small pack
c. medium pack
d. large pack
16.which biscuits u prefer to use?
a. marie gold
b. good day
c. parle - G
d. others
17.which hair oil u prefer to use?
a. parachute
b. dabur amla
c. dabur vatika
d. others
18.which pack u prefer to use?
a. small pack
b. medium pack
c. large pack
19.which cream u prefer to use?
a. ponds
b. fair & lovely
c. ayur
d. others
20.which coffee u prefer to use?
a. bru
b. nestle
c. Nescafe
d. others
78
