Ejss 21 1_04

European Journal of Social Sciences – Volume 21, Number 1 (2011)

A Comparative Study of Social and Psychological
Considerations of Rural and Urban Consumers

Jagwinder Singh
Dept. of Management, Dr B R Ambedkar National Institute of Technology
Jalandhar-144011, Punjab, India
Tel: 91- 95011- 03708
E-mail: jagwinpandher@yahoo.co.in

Abstract
India is one of the prominent markets now-a-days. Besides urban and semi-urban areas,
rural India has a huge potential. Marketers need to understand the rural India in contrast to
urban India. The study has been carried out with a view to understand differences between
rural and urban households in terms of social and psychological influences on their buying.
Three durable goods from three different product categories; Television (entertainment
product), Refrigerator (home appliance), and an Automobile (two-wheeler, motorcycle and
car/jeep) have been selected for study. A sample of 411 (204 from urban and 207 from
rural areas) households across the Punjab state (India) have been selected on the basis of
non-probability convenience sampling. No significant differences could be observed
between the habitant groups in terms of psychological influences on their buying. However
there had been insignificant differences between these groups in terms of social
considerations.

Keywords: Rural, Urban, Social, Psychological.

1. Introduction
One-sixth of the world’s population lives in India. Therefore, India is an attractive market (Ling and
Dawn, 2004). The economy witnesses increased potential for consumption, increased competition,
availability of products both in terms of quality and quantity, and increased level of awareness among
consumers. A large urban middle class and upper class, which constitutes one-third of the population,
is a huge market for branded goods. The market for branded goods is increasing at 8 per cent per
annum and in certain consumer goods; it is increasing at even 12 per cent. The Indian economy is the
third largest in Asia. It is expected to grow at 7 per cent. The decrease in import tariffs has allowed
large inflow of products from the other nations. Besides this, the Indian companies are entering into
strategic alliances with the foreign reputed brands (Kinra, 2006). It has been forecasted that elderly
population by 2010 will only be 9 per cent of the population as against 19 per cent of US and 30 per
cent of Japan. This implies that the Indian consumers are comparatively younger as compared to the
consumers of other nations including developed ones (Ling and Dawn, 2004).
Rahman and Bhattacharyya (2003 a) illuminate the characteristics of an emerging economy,
which is primarily referred to a third world country. The country enjoys potential of substantial
economic growth. The persistence of irrevocable trade liberalization process invites direct foreign
investment. To facilitate marketing transactions, institutional infrastructure also persists, though
comparatively less than that of an advanced nation. Also a small portion of total population enjoys the
larger proportion of a national income. For instance in India, 20 per cent of the population accounts for
34.1 per cent consumption of country’s goods and services. Though it is presumed that the diffusion
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curve of new product will be bell shaped but in India it is a skewed diffusion as the other groups start
consuming immediately after the innovators start consuming because of fear of being left out. Indian
corporations have now recognized the importance of rural markets.
Sangameshwaran (2002) highlighted the common mistakes which most of the foreign
marketers committed in Indian markets. These marketers overestimated the number of premium
customers whom they perceived willing to pay for quality and foreign label. Another misperception
was treating India as a single homogenous market, which instead is the amalgamation of several
regional markets with distinct tastes and preferences.
People who are at the bottom of the pyramid too have aspirations to consume goods and
services, which are enjoyed by the high-end consumers. It makes difference in the buying behaviour of
the consumers. A product being treated as a gift item in an urban area may be perceived as a necessity
item in the rural area. It may happen that the urban consumer buys any item out of impulse and for
rural consumer it may be a planned activity to buy the same. The urban consumer may not depend
upon the dealer for obtaining useful information about the product, but a rural consumer may heavily
depend upon the dealer for getting assurance about the product. Urban consumer may look for
exclusiveness of designs in the products and on the contrary rural consumer may be more concerned
about the core functionality of the product, which he intends to buy. Narasimhan (2005) presented
NSSO consumer data collected between January-June, 2004, which revealed that the monthly per
capita consumption expenditure of average urban household was 88 per cent greater than that of rural
household. The data further revealed that the difference had been persisted consistently over a period
of time. In order to get success in the rural markets, marketers need to conduct deep study of the
behaviour the rural consumer. The rural India may be culturally different from urban India. Different
cultures may produce different attitudes. Moreover the culturally derived attitudes affect consumption
patterns. Different members of a family may have different attitudes and in the collective decision-
making, the buying becomes really complex.
According to Sinha (2005), rural India in which more than 74 per cent of the population of the
country resides; generates one-third of country’s GDP. There are several reasons to believe that rural
markets in India are blossoming. The central government at the center has provided large sums of
money at the hands of rural folks. The government decided to hand out compensation in cash. The
government announced National Rural Employment Guarantee Scheme. It resulted into three benefits:
building rural infrastructure, plugging pilferage of funds and boosting disposable income at the hands
of rural households. The government has steadily raised the minimum support price (MSP) of the key
crops like wheat and paddy. The farmers have enjoyed copious harvests during the past couple of
years. The increase in MSP has protected the farmers from the possibility of price crashing during the
recession period. In the recessionary phase, the increase in crop prices are way ahead the input costs as
water and power are highly subsidized by most of the state governments and the increase in fertilizer
cost consequent to rise in the price of crude oil has also been absorbed by the government by
increasing fertilizer subsidy. Another boost for liquidity among farmers has come from loan waiver of
Rs. 65318 Crore. So, while the urban consumers are tottering under the cash crunch, their rural
counterparts are enjoying the easy liquidity. However farmers have always been exposed to seasonal
risks. Therefore, they preserve money and spend with caution. (Kar and Iyer, 2009).

2. Literature Review
The demographic measures are not accurate predictors of consumer behaviour. The demographic
factors have remained relevant in the past. These are now obsolete due to narrowing differences in
income, education and occupational status. Another argument against using demographics is that these
have generally failed to explain and predict consumption behaviour. Though these have remained
useful in determining the buying behaviour at the broad product-class level items such as durable
appliances, automobiles, and housing, yet these have failed to explain the brand-choice behaviour. The

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rationale behind using the demographics includes their ease of collection and management as compared
to other approaches. Therefore, it is premature to rule out demographics all together (Sheth, 1977). One
of the newest and most exciting approach is to select the target market is the lifestyle and
psychographic segmentation (Louden and Della Bitta, 2002). Psychographics is the method of defining
lifestyle in measurable terms (Burns and Harrison, 1979). Using psychographics along with
demographics may help the marketers to understand their consumers better (Louden and Della Bitta,
2002). Keeping in view the importance of the decision and the complexity of the buying situation, the
greater degree of rationalization may come after the actual purchase, if it was not produced at the time
of purchase. Therefore, indirect questioning and more subtle psychological approach are required for
obtaining information regarding intrinsic factors that influence the buying action (Downham and
Treasure, 1956).
While considering the social class, one should not confine to only the adult male wage earner.
Instead the characteristics such as employability and education of other family members should also be
considered (Louden and Della Bitta, 2002). Similarly the effects of mobility and reference groups
should also not be ignored (Zaltman and Wallendorf, 1979). Social class is superior to income in the
cases where spending patterns differ among different social classes, though they belong to same
income group. The product usage is more closely related to the income than to the social class in
certain durable goods (Myers et al, 1971). Generally social class is dominant to income for consumer
behaviour in terms of goods that do not involve high expenditures. On the other side, the income is
generally dominant to social class where the expenditures are substantial. There are goods such as
clothing, make-up, automobile and televisions which are highly visible and moreover are the symbols
of social class within class. The combination of social class and income remains dominant in such
situations (Shaninger, 1981). Social class and status are different concepts though these have an
important relationship. Status not only depends only on the social class but also depends upon many
individual factors such as authority, power, ownership of property, income, consumption patterns, life
style, occupation, education, service, and associations (Louden and Della Bitta, 2002).
Consumer sociology has already contributed to the body of knowledge relating to consumer
behaviour. Though all the work has not been done by the sociologists, others however had employed
sociological variables and analysis. The concepts of role, reference group, class, status and prestige
have proved to be especially useful in the analysis of consumer behaviour. In order to investigate the
buying patterns, the analysts have employed both social class and social status as variables. But it is
probably true to say that the social class represents the status characteristics rather than class positions.
Graham (1956) found that the acceptance of products differ according to the social class but not in a
simple manner. Various studies have revealed that the people of different social strata tend to differ in
terms of their psychological and behavioural patterns (Williams, 2002). Television was accepted to the
large extent by lower class members than by upper class members. Graham used occupation as the
main indicator of the social class, though it was criticized later. But his hypothesis was substantiated
that different classes will accept a given innovation to varying degrees. Some studies suggest that the
people of higher social class positions are likely to be more innovative in their buying patterns. In spite
of lack of any substantiation, the idea was widely accepted that new products are first accepted by
higher classes and later transmitted to lower classes. Other sociological concepts of reference group
and role behaviour are widely employed in consumer behaviour. Consumer behaviour occupies a
midway position between social sciences (sociology, psychology, economics and anthropology) and
the applied field of marketing. Consumer behaviour is used to refer the study of individual consumers
and group of consumers such as families and the area of study covered is concerned with factors that
cause the spending units to behave as they do. The orthodox economic theory emphasizes on the
maximization of utility to be gained from total purchases but does not explain the observed behaviour
of the consumers who pay sometimes more for an identical product (Foxall, 1974).
People with higher status occupations have characteristic personalities, motives and values.
Education is related to the social class because it is closely related to occupation. People are also

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socialized differently during their childhood. The children in lower social classes are characterized by
orderliness, obedience, respect, conformity, rigidity and physical toughness. On the other hand, the
children of high classes are characterized by independence, initiative, curiosity, self-control and self-
expression. There are two types of evaluation criteria: utilitarian evaluative criteria and hedonic
evaluation criteria. The former is related to objective, economic, rational, concrete and functional
purchase dimensions while the later is related to experiential, abstract, subjective, emotional, symbolic,
sensory, non-rational and aesthetic purchase attributes and benefits. The use of social class influence
was reduced by the marketers as they started using income dimension because it was easy for them to
use it. But there has been the substantial support to the social class membership as a determinant of
nature and extent of consumer information search (Williams, 2002).
Hansen (1976) presents the overview of psychologists’ approaches to consumer choice and has
generated several hypotheses for studying the choice process in different conditions. Choice is
characterized by conflict, uncertainty and cognitive activity. In order to make a choice, there must be at
least two alternatives that must arouse conflict and the cognition must be aimed at reducing that
conflict. Most decisions of the consumers are controlled by the internal as well as environmental
factors. The different decision processes occur because of different types of conflict situations. With
the acquisition of new beliefs, values or knowledge; the consumers may try new behaviours.
The psychology of consumer choice may be studied from three different perspectives: the
external factors influencing consumer choice, the internal directive factors, and the internal dynamic
factors. Among the external factors, the prominent are the effects of product-relevant communications
received from other persons, their past experiences with the products and their experience at the point-
of-purchase. The internal psychological makeup of the consumer can be categorized into two
categories: the directive and the dynamic aspects of the personality. The directive aspects comprise of
structural aspects of one’s personality that channel the information gathered either through one’s own
experiences or from other people. This involves the successive steps of exposure, perception,
comprehension, and agreement etc. The dynamic aspect is comprised of the motivational forces that
activate and sustain the information processing and account for its termination. People tend to expose
themselves to the information to which they likely to agree and they have the tendency to avoid
information, which is inharmonious. However in the actual situations, the tendency to avoid dissonant
information is overridden by other considerations. The studies reveal that people seek out the
information that is adaptive and novel and there are chances of receiving dissonant information. The
several studies point out that during information-processing, the consumer is often unconscious of what
he or she doing. The consumer may know how the decision was arrived at but actually what the person
describes was not the one that might have been applied. The consumers are therefore; less aware of
true basis for their purchasing actions, even when they think that they know the reasons. The directive
aspects describe the ‘how’ aspect of the information processing whereas dynamic aspects deal with
‘whys’ behind the processing. The motives can be divided into two categories: the cognitive motives
and affective motives. The former stresses the person’s need for adaptive orientation towards the
environment and for achieving a sense of meaning and the later stresses more on satisfying the feeling
states and to attain emotional goals. These two motives have been further categorized into two
categories: one those individuals who strive to maintain equilibrium and second those individuals who
aspire for further growth. The third basis for division is whether the person’s behaviour is actively
initiated or represents the passive response to the circumstances. The final dichotomy is based on
whether the motives are directed toward achieving a new internal state or a new external relationship
with the environment (MCGuire, 1976).
This evolution had not developed simultaneously in all societies and there were considerable
differences in the evolution process of each country. The necessity has both individual as well as social
dimension. The products are withdrawn from the markets either because of their functional wear and
tear, or due to qualitative wear and tear, or due to psychological obsolescence. The consumer of today
is eager to be led by others. All these things have resulted into adding dimensions to the consumer

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products beyond their utility characters and commercial value. The social symbols that consumers seek
in the products help them to integrate with the social group and to the feeling of belonging to the
community of their choice. It also helps them to differentiate from the social group that they avoid or
reject (de Rada, 1998). Consumers look beyond the functional or performance attributes of the
products. Besides functionality, they seek products for symbolic purposes in order to satisfy their
intrinsic psychological needs (Kim et al, 2002).
The most broadly used dimensions for cultural variability are individualism versus collectivism.
In individualistic cultures, people tend to prefer independent relationship with others and to
subordinate the group goals to their personal goals. On the contrary, in collectivism; people tend to
prefer interdependent relationships to others and subordinate their personal goals to the group goals.
Other studies introduce further distinction within the framework of individualism versus collectivism
i.e. horizontal (valuing equality) and vertical (preferring hierarchy). In vertical – individualist (VI)
societies, people tend to be concerned with improving their individual status and with distinguishing
themselves from others via competition (e.g. United States, Great Britain, France). In horizontal-
individualist societies, people prefer to view themselves as equal to others in status, with focus on
one’s uniqueness and self-reliance (e.g. Sweden, Norway, Australia). In vertical-collectivist societies,
people focus on enhancing the status of their group in competition with other groups, even by
sacrificing their personal goals (e.g. Japan, Korea, India). In horizontal-collectivist societies, the focus
is on sociability and interdependence with others in an egalitarian context (e.g. Israel). In consumer
research, both individualistic and collectivistic cultural conditions tend to be vertical. (Maheswaran and
Shavitt, 2000). Owning a television in China particularly in rural areas is still a sign of personal
success where watching TV is an activity of immediate and extended family. People keep TV in focus
from the street. It provides opportunity to Chinese consumers to support their integration to the society
and thus promoting collectivism (Piron, 2006). Maheswaran and Shavitt (2000) have also found that
Indian consumers favourably view foreignness and this attitude is more pronounced among consumers
who admire the lifestyles of economically developed countries. The removal of trade barriers has
opened up many avenues for the international players. India has emerged as one of the most promising
markets of the world due to increasing affluence of the middle class and increasing number of working
women. Though in general the imported products are welcomed in India, but it varies from product to
product category.
It has been further observed that in a richer country, people will be more individualistic perhaps
due to the reason they do not need the assistance of others, as wealth makes people independent. There
is lower power distance and uncertainty avoidance in the country, which is more individualistic
(Gronhoj, 2007). Triandis et al (1990) concluded that material comfort and urbanism have a positive
impact on the degree of individualism. The presence of larger families and greater importance of
agriculture are inversely related to individualism. There are effects of political system and religion as
well on the culture of the nation. The rural-urban disparities are prevalent in many parts of the world
and particularly in developing countries. There are rural-urban inequalities in output, income and
consumption in China. There has been inequality within rural and urban populations and across the
provinces. Rather rural inequality is weightier than urban inequality (Yao et al, 2005). Though rural
markets provide a big opportunity, but rural consumer varies from region to region. The needs and
lifestyle of farmer from Punjab is different from a farmer living in the other rural part of the country
(Halan, 2003).

3. Methodology Adopted
The study, which is descriptive in nature, has been carried out in Punjab state. Three durable goods
from three different product categories Television (entertainment product), Refrigerator (home
appliance), and an Automobile (two-wheeler, motorcycle and car/jeep) have been selected for study. A
sample of 411 (204 from urban and 207 from rural areas) households across the state have been

51


selected on the basis of non-probability convenience sampling. The data about current ownership or
likelihood of purchases in the next 24 months on the select durable goods (television, refrigerator and
any type of automobile) were obtained. In case of additional purchase/replacement or their likelihood
in near future about the select items, the respondents were asked to give their responses only to the
latest/likely buying. All respondents had been found possessing at least one item of each select
product. Ordinal scale (5 point) has been used for data analysis.
The study has been based on both primary as well as secondary data. In-depth interviews have
been conducted to look into insights of the consumers’ behaviour with the help of a pre-tested bilingual
questionnaire that was served to the respondents to obtain important information as regards to the
prime objectives of the study.
H1 Social influences differ among rural and urban consumers.
H2 Psychological influences differ among rural and urban consumers.
The hypotheses have been constructed on the basis of literature reviewed and the observations
of the researcher. The p-values have been calculated for all the variables / statements and on comparing
with central value (3 representing indifference to the statement) their significance has been checked at
95% confidence level. Similarly p-values have also been calculated to observe the significance (95%
confidence level) of differences between the responses of rural and urban consumers.
Discriminant analysis has also been carried out to observe the differences between rural and
urban consumers. Two-way ANOVA (Analysis of Variance) has been applied to test the independent
effects and the interaction effects of habitat (rural or urban) and income, and habitat and select
durables.

4. Limitations of the Study
The sample size is too small to generalize the findings. Moreover only three products (only one
product from three categories) have been selected. However there are large number of consumer
durables such as washing machines, water purifiers, air conditioners, generator sets, and kitchen
appliances etc. There is again a variety of items within a product category and they carry different
utilities at different values for different strata of consumers. The study needs to be further extended in
terms of other variables such as differences in the behaviours of different socio-economic groups of
rural and urban consumers and other demographic considerations. Also more predictors can be added
in further studies. Similarly, similarities and dissimilarities among different occupational categories of
rural and urban consumers can be considered in terms of their behaviours towards consumer durables.
Also only those households have been considered for study that had either all the three items
(television, refrigerators and any type of automobile) or they were likely to buy in near future. There
are many households which may have not any one or more of these select items and they were also not
likely to buy in near future. Some households had possessed some of the select durables for a long
time. The consumers’ preferences, considerations, and family life-cycle since then might have changed
and the behaviour particularly as regards to the influences within the household might be different as
compared to the time of acquisition of that durable. Therefore, the likely buying of next 24 months has
been made the part of the study to minimize the impact of this limitation.

5. Data Analysis and Results
The results are summarized here as under:

5.1. Television
In terms of social influences on the buying of the television sets (X1 to X4), both rural and urban
consumers had significantly considered the television set as a product of social image (X4) and there
had been no significant difference between the behaviours of these groups for this variable. The urban
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consumers at the time of buying television set considered significantly the liking of others (X1),
observed the buying of others (X2), and had tendency to achieve the sense of belongingness with the
people of their choice through the purchase of this product (X3). The rural consumers on the other
hand moderately considered these aspects. Significant differences had been observed in the behaviours
of these groups for the variables X1, X2 and X3 (Table T 1). Two-way ANOVA reveals no interaction
between income and habitat of consumers for all the select variables. No differences could be observed
among different income groups for all the select variables. There had been significant differences
between rural and urban consumers for the variables X1, X2 and X3 (Table T 1.1). Using discriminant
analysis, the structure matrix reveals the variable X2 be the highest discriminating variable followed by
X3 and X1. However according to both standardized canonical discriminant function coefficients and
two-way ANOVA, the variable X3 had been found the most discriminating variable. The classification
results have found 70.1% of the groups that have been correctly classified (Table T 1.2).

Table T 1: Social Considerations (Mean Values).

S. No. Variables U p (1 t) R p (1 t) U-R p (2 t)
U R
X1 Importance of liking of others while
buying this item. 3.53 <0.0001 2.92 0.1735 0.62 <0.0001
X2 Observe what others are buying and using. 3.81 <0.0001 3.10 0.1123 0.72 <0.0001
X3 Achieving a sense of belongingness with
people of your choice through this
purchase. 3.71 <0.0001 3.02 0.3679 0.69 0.0001
X4 This product is an expression of social
image. 3.28 0.0001 3.36 <0.0001 -0.08 0.4184
U = Mean Urban, R = Mean Rural, p (1 t) = p value one tailed, and p (2 t) = p value two tailed.

Table T 1.1: Social Considerations (F ratio).

S. No. Variables F ratio
R/U IG R/U*IG
(df =1) (df =4) (df =4)
buying this item. 12.574* 1.259 1.009
X2 Observe what others are buying and using. 21.738* 2.252 1.216
X3 Achieving a sense of belongingness with
people of your choice through this
purchase. 36.789* 0.778 1.979
X4 This product is an expression of social
image. 0.809 1.548 1.872
R/U = Rural-Urban, IG = Income Group, and R/U*IG= Two-way interaction between R/U and IG.

Table T 1.2: Social Considerations (Discriminant Analysis).

Standardized Canonical Unstandardized Canonical
Discriminant Function Discriminant Function
S. No. Variables Coefficients Coefficients Structure Matrix
1 X1 0.180 0.725 X2 0.746
2 X2 0.577 -0.097 X3 0.734
3 X3 0.619 -0.139 X1 0.574
4 X4 -0.133 0.416 X4 -0.085
Constant -0.345

In terms of psychological considerations (X5 to X10), the urban consumers strongly believed
that buying an expensive brand of television provides prestige (X5) whereas; the rural consumers had
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considered the same to the moderate extent. Both rural and urban consumers did not believe that
television is such a product through which they can enjoy showing their possessions (X6). The rural
consumers did not think that the buying of latest and novel model of television would reveal any
success of their life (X8). However the urban consumers had given moderate consideration to the same.

Table T 2: Psychological Considerations (Mean Values).

U R
X5 Buying an expensive brand provides prestige. 3.66 <0.0001 3.02 0.3679 0.63 <0.0001
X6 It is enjoyable to show possession of this
product. 2.74 0.0016 2.85 0.0238 -0.11 0.3687
X7 If someone ridicules your product, you would
feel irritated. 3.20 0.0036 3.29 <0.0001 -0.08 0.4014
X8 Buying latest and novel model reveals the
proxy of success. 2.93 0.2020 2.72 <0.0001 0.21 0.0636
X9 Using this product to define and expressing
‘you’. 2.77 0.0032 3.07 0.1592 -0.30 0.0059
X 10 Seeing anyone using this model/brand tells a
lot about that person. 2.73 0.0005 3.15 0.0250 -0.42 0.0002

Table T 2.1: Psychological Considerations (F ratio).

R/U IG R/U*IG
(df =1) (df =4) (df =4)
X5 Buying an expensive brand provides prestige. 23.867* 0.419 1.584
X6 It is enjoyable to show possession of this product. 0.000 1.739 0.912
X7 If someone ridicules your product, you would feel
irritated. 0.047 0.487 0.252
X8 Buying latest and novel model reveals the proxy of
success. 6.041* 0.469 1.537
X9 Using this product to define and expressing ‘you’. 5.721* 1.104 0.351
X 10 Seeing anyone using this model/brand tells a lot
that person. 3.306 1.226 1.130

Table T 2.2: Psychological Considerations (Discriminant Analysis).

1 X5 0.747 0.725 X5 0.752
2 X6 -0.114 -0.097 X 10 -0.454
3 X7 -0.141 -0.139 X9 -0.335
4 X8 0.468 0.416 X8 0.225
5 X9 -0.376 -0.345 X6 -0.109
6 X 10 -0.397 -0.347 X7 -0.102
Constant -0.843

But both these groups had shown intolerance if anyone would ridicule their television set (X7).
Urban consumers did not consider that the kind of a television used by a user could express anything
about the user (X9 and X10). However, the rural consumers considered the same from moderate to
significant extent respectively. The significant differences had been observed between the behaviours
of these groups for the variables X5 and X10 (Table T 2). Two-way ANOVA reveals no interaction
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between income and habitat of consumers for all the select variables. No differences could be observed
among different income groups for all the select variables. There had been significant differences
between rural and urban consumers for the variables X5, X8 and X9 with the highest F value for X5
(Table T 2.1). The discriminant analysis has found X5 as the most discriminating variable. The
classification results have found 66.2% of the original groups and 64.5% of the cross-validated groups
correctly classified (Table T 2.2).

5.2. Refrigerator
Table R 1: Social Considerations (Mean Values)

U R
buying this item. 3.58 <0.0001 2.86 0.0381 0.72 <0.0001
X2 Observe what others are buying and
using. 3.87 <0.0001 3.04 0.3012 0.83 <0.0001
X3 Achieving a sense of belongingness
with people of your choice through
this purchase. 3.75 <0.0001 2.99 0.4435 0.76 <0.0001
X4 This product is an expression of
social image. 3.33 <0.0001 3.25 0.0002 0.08 0.4242

Table R 1.1: Social Considerations (F ratio).

R/U IG R/U*IG
(df =1) (df =4) (df =4)
buying this item. 19.739* 1.406 1.271
X2 Observe what others are buying and
using. 31.662* 2.394* 1.422
X3 Achieving a sense of belongingness
with people of your choice through
this purchase. 44.523* 0.819 1.853
social image. 0.518 1.214 1.366

Table R 1.2: Social Considerations (Discriminant Analysis).

1 X1 0.205 0.182 X2 0.770
2 X2 0.601 0.596 X3 0.720
3 X3 0.571 0.573 X1 0.602
4 X4 0.027 0.026 X4 0.074
Constant -4.658

In terms of social influences on the buying of the refrigerators (X1 to X4), both rural and urban
consumers had significantly considered the refrigerator as a product of social image (X4) and there had
been no significant difference between the behaviours of these groups for this variable. The urban
consumers at the time of buying refrigerators considered significantly the liking of others (X1),
observed the buying of others (X2), and had tendency to achieve the sense of belongingness with the
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people of their choice through the purchase of this product (X3). The rural consumers on the other
hand were less likely to consider the liking of others. They observed the buying of others and had
tendency to achieve the sense of belongingness with the people of their choice moderately through the
purchase of this product. Significant differences had been observed in the behaviours of these groups
for the variables X1, X2 and X3 (Table R 1). Two-way ANOVA reveals no interaction between
income and habitat of consumers for all the select variables. No significant differences could be
observed among different income groups for all other select variables except variable X2. There had
been significant differences between rural and urban consumers for the variables X1, X2, and X3 with
the highest F value for X3 (Table R 1.1). Using discriminant analysis, the structure matrix reveals the
variable X2 be the highest discriminating variable followed by X3 and X1. The classification results
have found 71.5% of the groups that have been correctly classified (Table R 1.2).

Table R 2: Psychological Considerations (Mean Values)

U R
X5 Buying an expensive brand provides
prestige. 3.66 <0.0001 3.02 0.3718 0.63 <0.0001
X6 It is enjoyable to show possession of
this product. 2.74 0.002 2.85 0.0238 -0.11 0.3687
X7 If someone ridicules your product,
you would feel irritated. 3.20 0.0036 3.29 <0.0001 -0.08 0.4014
X8 Buying latest and novel model
reveals the proxy of success. 2.93 0.2020 2.72 <0.0001 0.21 0.0636
X9 Using this product to define and
expressing ‘you’. 2.89 0.1113 2.94 0.1565 -0.05 0.6747
X 10 Seeing anyone using this
model/brand tells you a lot about
that person. 2.90 0.1129 2.96 0.2740 -0.06 0.5964

Table R 2.1: Psychological Considerations (F ratio).

R/U IG R/U*IG
(df =1) (df =4) (df =4)
X5 Buying an expensive brand provides prestige. 23.867* 0.419 1.584
X6 It is enjoyable to show possession of this product. 0.000 1.739 0.912
X7 If someone ridicules your product, you would feel irritated. 0.047 0.487 0.252
X8 Buying latest and novel model reveals the proxy of success. 6.041* 0.469 1.537
X9 Using this product to define and expressing ‘you’. 0.211 1.567 0.949
X 10 Seeing anyone using this model/brand tells you a lot about that person. 0.804 1.305 1.297

Table R 2.2: Psychological Considerations (Discriminant Analysis).

1 X5 0.920 0.892 X5 0.891
2 X6 -0.202 -0.171 X8 0.267
3 X7 -0.289 -0.287 X6 -0.129
4 X8 0.410 0.365 X7 -0.121
5 X9 -0.175 -0.161 X 10 -0.077
6 X 10 0.011 0.010 X9 -0.060
Constant -2.161

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In terms of psychological considerations (X5 to X10), the urban consumers strongly believe
that buying an expensive brand of refrigerator provides prestige (X5) whereas; the rural consumers had
considered the same to the moderate extent. Both rural and urban consumers did not believe that
refrigerator is such a product through which they can enjoy showing their possessions (X6). The rural
consumers did not think that the buying of latest and novel model of refrigerator would reveal any
success of their life (X8). However the urban consumers had given moderate consideration to the same.
However both these groups had shown intolerance if anyone would ridicule their refrigerator (X7).
Both rural and urban consumers moderately considered that the kind of a refrigerator used by a user
could express anything about the user (X9 and X10). The significant differences had been observed
between the behaviours of these groups for the variable X5 (Table R 2).
Two-way ANOVA reveals no interaction between income and habitat of consumers for all the
select variables. No significant differences could be observed among different income groups for all
the select variables. There had been significant differences between rural and urban consumers for the
variables X5 and X8, with the highest F value for X5 (Table R 2.1). The discriminant analysis has
found X5 as the most discriminating variable. The classification results have found that 66.7% of the
original groups and 66.4% of the cross-validated groups have been correctly classified (Table R 2.2).

5.3. Automobile
Table A 1: Social Considerations (Mean Values).

U R
X1 Importance of liking of others
while buying this item. 3.62 <0.0001 2.95 0.2633 0.68 <0.0001
X2 Observe what others are buying
and using. 4.06 <0.0001 3.91 <0.0001 0.15 0.0880
X3 Achieving a sense of
belongingness with people of your
choice through this purchase. 4.00 <0.0001 3.42 <0.0001 0.58 <0.0001
social image. 3.33 <0.0001 3.25 0.0002 0.08 0.4242

Table A 1.1: Social Considerations (F ratio).

R/U IG R/U*IG
(df =1) (df =4) (df =4)
X1 Importance of liking of others while buying this item. 12.853* 2.702* 0.815
X2 Observe what others are buying and using. 7.332* 0.103 4.818*
X3 Achieving a sense of belongingness with people of your
choice through this purchase. 33.827* 1.448 3.001*
X4 This product is an expression of social image. 0.518 1.214 1.366

In terms of social influences on the buying of the automobiles (X1 to X4), both rural and urban
consumers had significantly considered the automobile as a product of social image (X4) and there had
been no significant difference between the behaviours of these groups for this variable. The urban
consumers at the time of buying automobiles considered significantly the liking of others (X1),
observed the buying of others (X2), and had the tendency to achieve the sense of belongingness with
the people of their choice through the purchase of this product (X3). The rural consumers on the other
hand moderately considered the liking of others. They observed the buying of others and had the
tendency to achieve the sense of belongingness with the people of their choice significantly through the
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purchase of this product. Urban consumers had the greater tendency to achieve the sense of
belongingness through this purchase (Table A 1). Two-way ANOVA reveals interaction between
income and habitat of consumers for the variables X2 and X3. No significant difference could be
observed between different income groups for all other select variables except variable X1. There had
been significant differences between rural and urban consumers for the variables X1, X2 and X3 with
the highest F value of variable X3 followed by X1 (Table A 1.1).

Table A 1.2: Social Considerations (Discriminant Analysis).

1 X1 0.634 0.549 X3 0.770
2 X2 0.104 0.117 X1 0.742
3 X3 0.653 0.684 X2 0.215
4 X4 0.035 0.034 X4 0.100
Constant -4.909

Using discriminant analysis, the structure matrix also reveals the variable X3 followed by X 1
be the highest discriminating variables. The classification results have found 67.6% of the original
groups and 66.9% of cross-validated groups correctly classified (Table A 1.2).

Table A 2: Psychological Considerations (Mean Values).

U R
X5 Buying an expensive brand provides prestige. 3.94 <0.0001 3.54 <0.0001 0.40 <0.0001
X6 It is enjoyable to show possession of this product. 3.83 <0.0001 3.62 <0.0001 0.21 0.0250
X7 If someone ridicules your product, you would
feel irritated. 3.82 <0.0001 3.48 <0.0001 0.35 0.0005
X8 Buying latest and novel model reveals the proxy
of success. 3.90 <0.0001 3.57 <0.0001 0.33 0.0006
X9 Using this product to define and expressing
‘you’. 4.01 <0.0001 3.33 <0.0001 0.68 <0.0001
X 10 Seeing anyone using this model/brand tells you a
lot about that person. 4.04 <0.0001 3.35 <0.0001 0.69 <0.0001

Table A 2.1: Psychological Considerations (F ratio).

R/U IG R/U*IG
(df =1) (df =4) (df =4)
X5 Buying an expensive brand provides prestige. 1.129 7.977* 2.063
X6 It is enjoyable to show possession of this product. 0.212 5.726* 3.339*
X7 If someone ridicules your product, you would feel
irritated. 0.653 10.077* 0.730
X8 Buying latest and novel model reveals the proxy of
success. 1.280 7.250* 1.384
X9 Using this product to define and expressing ‘you’. 23.848* 5.865* 0.717
X 10 Seeing anyone using this model/brand tells you a
lot about that person. 24.480* 5.581* 0.730

In terms of psychological considerations (X5 to X10), both rural and urban consumers strongly
believed that buying an expensive brand of automobile provides prestige (X5). But the extent of
58


agreement had been found significantly greater among urban consumers as compared to their rural
counterparts. Both rural and urban consumers strongly believed that automobile is such a product
through which they can enjoy showing their possessions (X6).
The urban consumers had given significantly greater consideration as compared to the rural
consumers. Both rural and urban consumers had opined significantly that buying the latest and novel
automobile reveals the proxy of success (X8). This perception had also been observed significantly
greater among the urban consumers as compared to the rural consumers. Both these groups had shown
intolerance if anyone would ridicule their automobile (X7). The urban consumers had been found
significantly greater intolerant than rural consumers. Both rural and urban consumers significantly
considered that the kind of an automobile used by a user could express anything about the user (X9 and
X10). Urban consumers had been found giving significantly greater consideration than the rural
consumers in this aspect. The significant differences had been observed between the behaviours of
these groups for all the select variables (Table A 2).

Table A 2.2: Psychological Considerations (Discriminant Analysis).

1 X5 0.403 0.398 X 10 0.892
2 X6 0.164 0.160 X9 0.890
3 X7 0.041 0.041 X5 0.484
4 X8 -0.003 -0.003 X8 0.422
5 X9 0.206 0.218 X7 0.418
6 X 10 0.632 0.658 X6 0.256
Constant -5.449

Table 3: Two-Way Anova (Habitat and Product Categories)

R/U PC R/U* PC
(df =1) (df =2) (df =2)
X1 Importance of liking of others while buying 106.020* 0.425 0.225
X2 Observe what others are buying and using. 102.639* 39.963* 14.148*
X3 Achieving a sense of belongingness with people of your choice 145.420* 15.853* 0.912
through this purchase.
X4 This product is an expression of social image. 0.209 0.142 0.861
X5 Buying an expensive brand provides prestige. 90.855* 20.653* 1.689
X6 It is enjoyable to show possession of this product. 0.000 92.293* 2.685
X7 If someone ridicules your product, you would feel irritated. 1.063 22.532* 6.240*
X8 Buying latest and novel model reveals the proxy of success. 16.302* 98.610* 0.431
X9 Using this product to define and expressing ‘you’. 3.591 71.104* 24.338*
X 10 Seeing somebody else using this model/brand tells you a lot about that 1.267 67.654* 28.498*
person.

Two-way ANOVA reveals no interaction between income and habitat of consumers for all
other variables except X6. There had been significant differences between different income groups for
all the select variables, with the highest F value for variable X7. There had been significant differences
between rural and urban consumers for the variables X9 and X10 with the highest F value for variable
X10 (Table A 2.1).
The discriminant analysis has also found X10 as the most discriminating variable. The
classification results have found that 66.8% of the original groups and 65.1% of the cross-validated
groups have been correctly classified (Table A 2.2).

59


In terms of social considerations there had been no interaction between habitat and the product
categories for all other select variables except X2. There had been significant differences between rural
and urban consumers for all other select variables except X4 with the highest F value for X3 followed
by X1. There had been significant differences between the behaviour of these consumers for the three
different select products only in terms of variables X2 and X3 with the highest F value for X2 followed
by X3.
In terms of psychological considerations, there had been an interaction between habitat and the
product categories for the select variables X7, X9 and X10 with the highest F value for X10 followed
by X9. There had been significant differences between rural and urban consumers only for the select
variables X5 and X8 with the highest F value for X5. There had been significant differences between
the behaviour of these consumers for the three different select products in terms of all select variables
with the highest F value for X8 followed by X6.

6. Discussion and Conclusions
The discussion and conclusions of the study are as under:

6.1. Social Considerations
Both rural and urban consumers equally and significantly consider all these products as the products of
social image. This is in conformity to the findings of Shaninger (1981) that found the dominance of
social class clubbed with income in case of buying of socially visible goods. The urban consumers at
the time of buying these products consider significantly the liking of others whereas; the rural
consumers consider the liking of others to the moderate extent in case of televisions and automobiles.
However in case of refrigerators, the rural consumers tend to consider less likely the liking of others. In
case of automobiles, the consideration of liking of others also differs among different income groups.
This is so because the rural consumers look more at the necessity of the item as well as their budget.
The urban consumers observe the buying of other consumers and through the purchase of these
products; they tend to achieve the sense of belongingness with the people of their choice. This is in
conformity to the findings of de Rada (1998) stating that consumers seek social symbols in the
products that help them to integrate with the social group and to the feeling of belonging to the
community of their choice. It also helps them to differentiate from the social group that they avoid or
reject. The rural consumers in case of televisions and refrigerators do the same to the moderate extent.
However in case of automobiles, the rural consumers too significantly observe the buying of others and
tend to achieve the sense of belongingness with the people of their choice through its purchase. In the
later case, the tendency of the urban consumer is significantly greater than the rural consumers.
However these differences differ among different income levels of these habitants. In case of
refrigerators, the act of observing the buying of others also differs among different income groups
indicating the dominance of both social class and income as revealed by Shaninger (1981) about the
highly visible products. Considering all the select products, there have been differences between rural
and urban consumers for all other select variables except considering the product as an expression of
social image. Product based differences do exist among consumers in terms of observing the others’
buying and achieving a sense of belongingness with others through the purchase of products. The
differences in the former case differ between rural and urban consumers. Overall there are
considerable differences between rural and urban consumers for the buying of televisions and
refrigerators.

6.2. Psychological Influences
The urban consumers strongly believe that buying an expensive brand of television, refrigerator or
automobile provides prestige whereas; the rural consumers consider the same to the moderate extent

60


for television and refrigerator and to the large extent for an automobile. In case of an automobile, the
differences also exist among different income groups. The high value of the product certainly adds to
the prestige. Both rural and urban consumers do not believe that television and refrigerator are
ostentatious possessions, which is inconsistent with the findings of Piron (2006) that found the
perception of buying of television as a personal success particularly among rural households. This is
due to the fact that there can be different consumption patterns in different regions (Halan, 2003). On
the contrary, in case of automobiles, both the groups believe opposite. Such a tendency is greater
among urban consumers as compared to their rural counterparts. The differences differ among different
income levels of habitants for this variable. The rural consumers do not think that the buying of latest
and novel models of television and refrigerator would reveal any success of their life. The urban
consumers give moderate consideration to the same. But in case of automobiles, both the groups give
significant consideration and urban consumers in comparison to the rural consumers give greater
consideration. The differences also exist among different income groups for this variable in case of
automobile. Both these groups have intolerance if anyone would ridicule their television, refrigerator
or automobile. In case of an automobile, the intolerance is comparatively greater among urban
consumers than their rural counterparts. The differences also exist among different income levels for
this variable in case of automobile.
In case of an automobile, both urban and rural consumers consider that the kind of an
automobile used by the user expresses something about the user. The differences also exist among
different income groups for this variable. This perception is significantly greater among the urban
consumers than the rural ones. In case of refrigerator, both rural and urban consumers moderately
consider that the kind of a refrigerator used by a user may express anything about the status of the user.
However in case of television, urban consumer does not and the rural consumer moderately thinks so.
This has conformance to the view point of Kim et al (2002) that all products carry some symbolic
meaning. In some cases the symbolic role may be salient and rich. Many products provide important
nonverbal cues that must be seen, heard, tasted, felt or smelled. Considering all the select products,
there have been differences between rural and urban consumers only for the perception of prestige by
buying an expensive brand and revelations of success by buying the latest / novel models. Product
based differences do exist for all the select variables exhibiting conformance to the study of
Maheswaran and Shavitt (2000). However these differences in terms of irritation on ridiculing the
product and the use of the product expressing something about the user; differ between rural and urban
consumers. Overall there are insignificant differences between rural and urban consumers for all the
select products.

7. Managerial Implications
The study has the tremendous scope. Very few studies have been carried out to understand the
behaviour of rural consumer in India. Moreover the studies on consumer durables are further less.
Negligible attempts have been made particularly in India to differentiate the rural consumer from the
urban one. The model can be applied to understand the differences between the behaviours of rural and
urban consumers of the other states of the country as well as for different categories of products. It will
help the marketers to understand the consumers’ dynamics better so as to formulate and execute the
distinct and complete marketing offerings while approaching their target territories. The study can be
further extended to other sub groups that can be classified on the basis of income, occupation, and
educational levels, etc. The marketers in their advertising messages must associate their products with
the social class of their target segment so that consumers find the sense of belongingness with a
particular social class through the purchase of these products. They may also exhibit the liking of brand
by a particular social class. Associating products with social class may help the marketers to make a
breakthrough in the rural mindset as the income of rural consumer increases further.

61


The marketing offer of an automobile should be entirely different from that of other two
products. In case of products like television and refrigerator, the urban consumer relates price of the
brand to his status. The latest technology and novelty in the models does not create any excitement
among the urban consumers. So the marketers must display rareness and exclusiveness of brand while
targeting urban consumers. The automobile is a product that is demonstrated by both rural and urban
consumers as a proxy of their success. They also tend to express themselves or make perceptions about
others through this product. Therefore, marketers must make sure that all such psychological
aspirations are an integral part of their marketing offering. Though the same should be more prominent
in the marketing offering for urban consumers, yet the rural consumer should be given equal offering.
This is so because that these aspirations would further increase among rural consumers with increase in
their incomes in future.

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