Project Report - Sem 3

“A STUDY ON BRAND PREFERENCE FOR BAJAJ TWO WHEELER’S

AMONG CUSTOMERS IN VELLORE”

PROJECT REPORT

Submitted to

DRAVIDIAN UNIVERSITY

In the partial fulfillment for the award of

MASTER DEGREE IN BUSINESS ADMINISTRATION

Submitted by

MR. MATHAN RAJ P.K.

REG NO: 22205409010

Under the guidance of

MRS. P. RAJESWARI M.B.A. M.Phil.

OSCAR MANAGEMENT COLLEGE

#A-2, Near Collectorate,

Sathuvachari, Vellore – 9.

2009-2011

(Approved by DRAVIDIAN UNIVERSITY)

#A-2, Near Collectorate,

Sathuvachari, Vellore – 9

BONAFIDE CERTIFICATE

This is to certify that this project entitled “A STUDY ON BRAND

PRFERENCE FOR BAJAJ TWO WHEELER’S AMONG CUSTOMERS

IN VELLORE” submitted by MR.MATHAN RAJ.P.K (Reg No:

22205409010) in partial fulfillment of the requirement for the award of Master

of Business Administration from DRAVIDIAN UNIVERSITY, is the original

work of the candidate and has not been submitted for awarding any degree of

either this university or any other university either in full or in part.

Signature of the Guide

(RAJESWARI.P)

OSCAR MANAGEMENT COLLEGE

#A-2, Near Collectorate,

Sathuvachari, Vellore – 9

EXTERNAL CERTIFICATE

This is to certify that this project entitled “A STUDY ON BRAND

PRFERENCE FOR BAJAJ TWO WHEELER’S AMONG CUSTOMERS

IN VELLORE” submitted by MR.MATHAN RAJ.P.K (Reg No:

22205409010) for viva voce Examination held on ______________ in partial

fulfillment of the requirement for the award of Master of Business

Administration from DRAVIDIAN UNIVERSITY.

External Examiner Internal

Examiner

Principal

OSCAR MANAGEMENT COLLEGE

(Approved by DRAVIDIAN UNIVERSITY)

#A-2, Near Collectorate,

Sathuvachari, Vellore – 9

DECLARATION

I, Mathan Raj.P.K. hereby declare that the project entitled “A STUDY ON

BRAND PRFERENCE FOR BAJAJ TWO WHEELER’S AMONG

CUSTOMERS IN VELLORE” submitted to DRAVIDIAN UNIVERSITY in

partial fulfillment of the degree in Master of Business Administration is a record

of original work done by me. This project work has not previously formed the

basis for the award of any degree, diploma, associateship, fellowship or other

similar title.

Place: (MATHAN RAJ.P.K.)

Date: Reg No: 22205409010

First and foremost, I thank GOD for the blessings and guidance at all stages in the completion of this project.

I take this opportunity to express my deep sense of gratitude to

Mr. JAI CHANDRAN, Founder Chairman, of our college for his good wishes for this

project. I express my immense gratitude to my Principal Mr. P. PETER for his support and encouragement for the completion of my project.

I extend the immense gratitude to the Project Guide Mrs. P. RAJESWARI who provided her guidance and inspiration in doing this project and without her guidance, motivation and support, this project will not be possible. I take immense pleasure in conveying my thanks and deep sense of gratitude to my faculty and my mentor

Mrs. IDA SELVARANI, for her exhilarating supervision, timely suggestions, motivation

and encouragement during all phases of this project work.

I also thankful to all other faculty members of the department for the constant co-operations and encouragement in pursuing my project work.

I also very much thankful to Mr. SARAVANAN, Sales Manager of Shree Lakshmi Motors, Mr. RAVI, General Manager of Shree Lakshmi Motors and Mr. S. RAJA GURU, General Manager of Aakash Motors, who has provided me with the customer database and lots of information which is helpful for the project.

I specially thank Dr. R. RAVANAN, Associate Professor of Statistics, Presidency College, Chennai for his teaching and guidance in the SPSS Package and in different Statistical tools. Without his guidance it is not easy to complete the data analysis part.

I would like to thank all my friends for their constant encouragement, support and help to make this project a success. I specifically thank to my friends, Mr. R. SARAN RAJ and Mr. S. SIVAPRAKASAM who helped me a lot in the data collection process and

Mr. JAISON SAMUEL who helped me in the initial analysis process of this project.

Finally, I would like to convey my gratitude to my loveable parents & relatives whose prayers and blessings were always there with me.

TABLE OF CONTENTS

CHAPTER NO TITLE PAGE NO

1 INTRODUCTION

1.2 Statement of the Problem 3

1.3 Need for the Study 3

1.4 Objectives of the Study 4

1.5 Scope of the Study 4

1.6 Limitations of the Study 4

1.7 Company Profile 5

2 RESEARCH METHODOLOGY

2.1 Field of the Study 9

2.2 Research Design 9

2.3 Sample Design 11

2.4 Source of Data 12

2.5 Tool of Data Collection 12

2.6 Data Analysis 13

3 REVIEW OF LITERATURE

3.1 Theoretical Framework 21

3.2 Research Studies 34

4 DATA ANALYSIS AND INTERPRETATION 43-87 5 FINDINGS, SUGGESTIONS AND CONCLUSION

5.1 Findings 88

5.2 Suggestions 91

5.3 Conclusion 92

Annexure Questionnaire_Bibliography 93₉₆

LIST OF TABLES

TABLE NO TABLE NAME PAGE NO

1.1 Key People of Shree Lakshmi Motors 8 1.2 Key People of Aakash Motors 8

2.1 Address of Dealers 9

3.1 Black Box Model 26

4.1 Details of Age Group 43

4.2 Details of Educational Qualification 45 4.3 Occupation Information about the Respondents 47 4.4 Details of Monthly Income 49

4.5 Need for buying the bike 51

4.6 Frequency table for factors affecting the Purchasing Decision 53

4.7 Friedman Test 54

4.8 Personal Source of Information 55 4.9 Commercial Source of Information 57 4.10 Experimental Source of Information 59 4.11 Medium of Communication that influences the Brand Preference 61

4.12 Mode of Purchase 63

4.14 Period took to choose the Bajaj Brand 65 4.15 Frequency table showing the reason for Brand preference 67 4.16 Percentage of Product Features 69

4.17 ANOVA – Total Features 70

4.18 Descriptive Statistics 70

4.19 Percentage of Showroom Attributes 71 4.20 ANOVA – Total Showroom Attributes 72

4.21 Descriptive Statistics 72

4.22 Role of availability in the selection of brand 73 4.23 Trust Level on the Bajaj Brand 74 4.24 Reaction of customer when Bajaj Brand is not available during

the purchase 75

4.25 Percentage of Satisfaction on the given attributes 76 4.26 Correlation between Level of Satisfaction of Safety and Comfort 77

4.27 ANOVA – Total Price 78

4.28 Descriptive Statistics 78

4.29 Rating of Overall Service Experience 79 4.30 Overall Satisfaction level with regards to the Bajaj bike 80 4.31 Correlation between Overall Satisfaction and Service Experience 81 4.32 Future Purchase Decision 82 4.33 Level of Promoting the Bajaj Brand 83 4.34 One Sample T-Test for the Level of Promotion at 1% level 84 4.35 Level of Recommendation of dealer to others 85 4.36 Crosstabs between Educational Qualification and Brand

Preference Level 86

LIST OF FIGURES

FIGURE NO FIGURE NAME PAGE NO

1.1 Organizational Structure of Shree Lakshmi Motors 7 1.2 Organizational Structure of Aakash Motors 8 3.1 Project Study Analysis Process 24

3.2 Buying Decision Process 30

3.3 Steps between Purchase Intention & Purchase Decision 32 4.1 Percentage of respondents based on Age Group 44 4.2 Percentage of respondents based on Education 46 4.3 Percentage of respondents based on Occupation 48 4.4 Percentage of respondents based on Income Level 50 4.5 Percentage of Need for buying the bike 52 4.6 Percentage of Personal Source of Information 56 4.7 Percentage of Commercial Source of Information 58 4.8 Percentage of Experimental Source of Information 60 4.9 Percentage of Influence of Communication Medium 62 4.10 Percentage of Period took to choose the Bajaj Brand 66 4.11 Percentage of Preference Reason 68

CHAPTER 1

INTRODUCTION

Brand Preference is the measure of Brand Loyalty in which a consumer will choose a particular brand in presence of competing brands, but will accept substitutes if that brand is not available. Brand Loyalty refers to the extent of the faithfulness of consumers to a particular brand, expressed through their repeat purchases, irrespective of the marketing pressure generated by the competing brands.

In every product category, consumers have more choices, more information and higher expectations than ever before. To move consumers from trial to preference, brands need to deliver on their value proposition, as well as dislodge someone else from the consumer's existing preference set.

Preference is a scale, and brands move up, down and even off that scale with and without a vigilant brand management strategy. Pricing, promotional deals and product availability all have tremendous impact on the position of brand in the consumer’s preference set. If all things are equal, the best defense is to make the brand more relevant to consumers than the competition.

The brands potential can only be fulfilled by continually reinforcing its perceived quality, upmarket identity and relevance to the consumer. The same branding activities that drive awareness also drive preference. And, while awareness alone will not sustain preference, it will improve the brand’s potential for building and maintaining preference.

With a great story and a large enough investment, awareness can be attained rather quickly. It takes time, however, and constant revaluation to build brand preference. Aristotle professed, “We are what we repeatedly do. Excellence then is not an act, but a habit.” Attaining and sustaining preference is an important step on the road to gaining brand loyalty. The ability to generate more revenue, gain greater market share and beat off the competition is the reward given by consumer toward particular brand.

Brand preference is the Selective demand for a company's brand rather than a product; the degree to which consumers prefer one brand over another. In an attempt to build brand preference advertising, the advertising must persuade a target audience to consider the advantages of a brand, often by building its reputation as a long-established and trusted name in the industry. If the advertising is successful, the target customer will choose the particular brand over other brands in any category.

The frequency of repeat purchase in case of two wheeler market is very low. So, the measure of Loyalty is not easy. The brand loyalty of the customer can be identified with the help of how they promote the brand to others, i.e. Word of Mouth Communication. Even though competitors are low in the two wheeler’s segment, competition is very high due to the availability of different product categories under different brands.

The Customers preference among these brands also not easy as the product possesses similar features in all the brands. So, the customer satisfaction determines the loyalty. Customer will get satisfied only when their expectations met or exceed. It is an after purchase behavior. To analyze the Brand Preference and Loyalty, it is necessary to study both the consumer’s buying behavior and after purchase behavior.

1.2 Statement of the Problem

The changing customer perception because of the availability of variety of products in two wheeler segment along with the growing number of competitors had a major impact in the preference of a particular brand. The customers’ decision making process also changes as their buying pattern changes.

The players in the two wheeler market in the Vellore are Bajaj, Hero Honda, TVS, Yamaha, Suzuki, Mahindra, BSA, Ultra Motors and Royal Enfield. Each and every company has different varieties of product category in the two wheelers, which gives lot of options for the customers in Vellore. The fast developing technology and the growing economic status of the people in the Vellore city drive their preference decision.

Bajaj held the most of the market share in the two wheeler segment in Vellore after the launch of CT 100 model which gave good mileage and Pulsar which attracted most of the young customers. Later after the launch of TVS Apache, Yamaha FZ, the preference of brand among customers varied a lot with the availability of various options. So, this study was undertaken to analyze the above mentioned issues.

1.3 Need for the Study

1. The first and foremost need for this study is due to the increasing brand variety in the Vellore two wheeler’s market which is eroding the Brand Loyalty of the customers. 2. The increasing media clutter and the changing consumer preferences.

3. The more number of split loyal and shifting loyal customers are available in the market.

4. Brand Loyalty of a customer is influenced by the customer’s perceived value which is the basic belief results in the action. So, to analyze the preference of brand and to find the factors influencing the Brand Preference of the customer in the two-wheeler segment.

1.4 Objectives of the Study

1. To study the perception and buying behavior of customers in two wheelers. 2. To measure the Brand Loyalty of Bajaj.

3. To study the customers view on features of two wheeler’s and the impact of the communication medium.

4. To study the factors that influence decision-making in choosing the brand. 5. To suggest factors to retain the customers.

1.5 Scope of the Study

• The study is only on Brand Preference so the other aspects such as Brand Recognition, Brand Image, Brand Equity and other branding concepts are not covered.

• Brand Loyalty, Perception and Buying Behavior of respondents are also studied in this research.

• This study covered only the area of the Vellore city. So, the information and the conclusion derived from the study are only relevant to this area alone.

1.6 Limitations of the Study

• The duration of the project was one of the primary constraints for the project.

• This study is confined only among the Bajaj customers in the Vellore city.

• It was an academic effort and limited to cost, time and geographical area.

• Numbers of respondents were restricted due to the time factor.

1.7 Company Profile

Bajaj Auto is a major Indian automobile manufacturer started by a Rajasthani merchant. It is

based in Pune, Maharashtra, with plants in Chakan (Pune), Waluj (near Aurangabad) and Pantnagar in Uttaranchal. The oldest plant at Akurdi (Pune) now houses the R&D centre ahead. Bajaj Auto makes and exports motor scooters, motorcycles and the auto rickshaw. Over the last decade, the company has successfully changed its image from a scooter manufacturer to a two wheeler manufacturer. Its product range encompasses scooterettes,

scooters and motorcycles. Its real growth in numbers has come in the last four years after successful introduction of a few models in the motorcycle segment.

The Bajaj Group is amongst the top 10 business houses in India. Its footprint stretches over a wide range of industries, spanning automobiles (two-wheelers and three-wheelers), home appliances, lighting, iron and steel, insurance, travel and finance. The group comprises of 34 companies. The group's flagship company, Bajaj Auto, is ranked as the world's fourth largest two- and three- wheeler manufacturer and the Bajaj brand is well-known across several countries in Latin America, Africa, Middle East, South and South East Asia. Founded in 1926, at the height of India's movement for independence from the British, the group has an illustrious history. Jamnalal Bajaj was the founder of the Bajaj group.

Bajaj Auto came into existence on November 29, 1945 as M/s Bachraj Trading Corporation Private Limited. It started off by selling imported two- and three-wheelers in India. In 1959, it obtained license from the Government of India to manufacture two- and three-wheelers and it went public in 1960. In 1970, it rolled out its 100,000th vehicle. In 1977, it managed to produce and sell 100,000 vehicles in a single financial year. In 1985, it started producing at Waluj near Aurangabad. In 1986, it managed to produce and sell 500,000 vehicles in a single financial year. In 1995, it rolled out its ten millionth vehicles and produced and sold 1 million vehicles in a year.

According to the authors of Globality: Competing with Everyone from Everywhere for Everything, Bajaj has grown operations in 50 countries by creating a line of value-for-money bikes targeted to the different preferences of entry-level buyers.

His son, Kamalnayan Bajaj, then 27, took over the reign of business in 1942. Kamalnayan Bajaj not only consolidated the group, but also diversified into various manufacturing activities. The present Chairman of the group, Rahul Bajaj, took charge of the business in 1965. Under his leadership, the turnover of the Bajaj Auto the flagship company has gone up from INR.72 million to INR. 120 billion, its product portfolio has expanded and the brand has found a global market. He is one of India’s most distinguished business leaders and internationally respected for his business acumen and entrepreneurial spirit. The Vice Chairman of Bajaj Auto is Madhur Bajaj.

In early March 2010, Bajaj Auto Ltd. once again demonstrated its commitment to green technology by achieving Bharat Stage-III norm compliance for its range of products-the first company to do so. The Bharat Stage III norms were notified by Government of India on recommendation by Dr. R.A. Mashelkar committee for the control of pollution in the country and are applicable across all states.

Products

Bajaj has made a number of motorcycles, scooters and cars. Motorcycles in current production are the XCD, Platina, Discover, Pulsar and Avenger. Bajaj also produces many motorcycles for other manufacturers, such as the Kawasaki Ninja 250R, Yamaha YZF-R15 (Unsure), and new for 2011, the KTM Duke 125, Cars include the Bajaj ULC ultra-low-cost car.

Low Cost Cars

Bajaj Auto says its $2,500 car, which it is building with Renault and Nissan Motor, will aim at a fuel-efficiency of 30 kilometres per litre (85 mpg-imp; 71 mpg-US) (3.3 L/100 km), or twice an average small car, and carbon dioxide emissions of 100 g/km. The car is scheduled to be launched in 2012. It is a Tata Nano competitor. The Bajaj venture will have an initial capacity of 400,000 units, while Tata expects eventual demand of 1 million Nanos.

Shree Lakshmi Motors

The journey with Bajaj was started from January 2009 after purchasing the Susee Motors Dealership. Previously the dealership in the Katpadi and the surrounding area was taken care by Susee Motors. But, in 2009 Shree Lakshmi Motors bought the dealership with Bajaj for that area. It was started by Mr.Ravi, Sole Proprietor for the company. They are taking care of both the sales and service of Bajaj two wheelers in their area successfully.

This is a separate business unit for the organization which totally has 5 business units. The other business units are unrelated to each other and covering many other sectors, and

targeting different market segment in Vellore district. The following are the five businesses which come under this organization.

1. Ravi Electricals 2. Hotel Shree Lakshmi 3. KRR Group Real Estate 4. Ravi Auto Consultancy 5. Shree Lakshmi Motors

Totally 15 employees are working in the company, among which 5 are front office staffs and the remaining 10 are service mechanics.

Fig 1.1: Organizational Structure of Shree Lakshmi Motors

Table 1.1 Key People of Shree Lakshmi Motors

Name Position

Mr. Ravi General Manager

Mr. Saravanan Managing Director Mr. Naveen Sales Manager

Mr. Guru Service Manager

Aakash Motors

The company joined their hands with Bajaj from July 2009 covering the area of Sainathapuram and Bagayam of Vellore District. The owner of the company Mr. S.RajaGuru began the company with 12 workers and the business is running successfully in that particular

GM

MD

Sales

Manager

Service

Manager

area. The yearly turnover of the company is around Rs. 3 crores. This dealer is taking care of both the sales and service of Bajaj two wheelers.

Fig 1.2: Organizational Structure of Aakash Motors

Table 1.2 Key People of Aakash Motors

Name Position

Mr. S. RajaGuru General Manager Mr. Saravanan Sales Manager Mr. Ramkumar Service Manager

CHAPTER 2

RESEARCH METHODOLOGY

The study was conducted among the customers of two Bajaj dealers in Vellore. They are Shree Lakshmi Motors in Katpadi Road and Aakash Motors in Sainathapuram.

Table 2.1 Address of Dealers

Address of Dealer 1: Address of Dealer 2:

Shree Lakshmi Motors Chittor High Road,

Near Vijay Sales, Katpadi, Vellore – 632 007.

Aakash Motors No. 83, Arani Road, Sainathapuram, Vellore – 632 001. 2.2 Research Design

GM

Sales

Manager

Service

Manager

A Research design is the arrangement of conditions for collection and analysis of data in a manner that aims to combine relevance to the research purpose with economy in procedure. A Research design could be defined as the blue print specifying every stage of action in the course of research. Such a design would indicate whether the course of action planned will minimize the use of resources and maximize the outcome.

Descriptive Research Design

The Research design used in this study was Descriptive Research Design. Descriptive studies come under formal research, where the objectives are clearly established. It is concerned with the research studies with a focus on the portrayal of the characteristics of a group or individual or a situation. The main objective of this type of study is to acquire knowledge. For example, to identify the use of a product to various groups, a research study may be undertaken to question whether the use varies with income, age, sex or any other characteristics of population. Similarly, such studies are used to examine the characteristics of the corporate sector or consumer behavior, etc.

Descriptive Approach

In this approach, a problem is described by the researcher using questionnaire or schedule. This approach enables the researcher to explore new areas of investigation. A researcher develops the hypothesis based on the knowledge about the subject matter of study. When this approach is adopted, the researcher should be intelligent and alert to elicit the information required from the respondents as accurately as possible.

Merits of Descriptive Approach

• This approach helps to test the conclusions and findings arrived at on the basis of laboratory studies. By using this approach, it is possible to substantiate existing theories and conclusions or modifying them.

• Direct contact between the researcher and the respondent is brought about in this approach. This is very significant because, the researcher would be able to understand himself clearly the problem being studied.

• With the possibility of direct contact with the respondent, the researcher is able to elicit all the relevant information and eliminate irrelevant facts.

Limitations of Descriptive Approach

• Unless a researcher is experienced, there is every possibility of this approach being misused. Hurried conclusions and generalizations may be formed based on the inaccurate field data.

• As this approach involves collection of field data, enormous time and efforts are required to plan and execute the field survey.

• This approach also involves incurring heavy cost on data collection.

• Unless the respondents are cooperative, it is not possible to collect data through this approach.

• Since this approach requires considerable time for data collection, by the time the data collection is complete and analysis are undertaken, conclusions arrived at may not have any relevance.

2.3 Sample Design

A Sample Design is a definite plan for obtaining a sample from a give population. It refers to the technique or the procedure the researcher would adopt in selecting items for the sample. The sampling technique which was used in this research was Systematic Random Sampling. It is one of the Probability Sampling techniques. Probability Sampling is the sampling technique in which every unit of the population has given equal chance to be included in the study. A Systematic Random Sampling is a technique which contains every ‘i’th _{element of}

the population. The first element is chosen randomly, the rest systematically.

Merits of Systematic Random Sampling

1. It is very convenient and simple to adopt. 2. The time and cost involved are relatively less.

3. With a large population, this method of sampling is easy to use.

4. Random selection of items is ensured, once the sampling interval is determined. 5. Sampling interval is determined scientifically depending upon the size of sample

desired.

1. It is less representative, as once the first item is selected at random, subsequent items are all lying at uniform interval. So, the selected items may lack complete

representativeness.

2. This method requires correct understanding of the methodology as otherwise, the sample selected will not be correct.

3. The first item selected should be strictly at random. If there is any bias in this first stage, this will influence the items selected at subsequent stages.

Population: N = 240 Sample Size: n = 120 Sampling Interval: k = N/n k = 240/120, therefore, k = 2 2.4 Source of Data Primary Data

Primary data is known as the data collected for the first time through field survey. The important source for the primary data collection is through Questionnaire and other source is through Sales force opinion.

Secondary Data

Secondary data refers to the information or facts already collected. Such data are collected with the objective of understanding the past status of any variable. Secondary sources include the following. ➢ Books ➢ Journals ➢ Research Thesis ➢ Foot notes ➢ Internet

2.5 Tool of Data Collection

The primary tool which was used for data collection was Questionnaire. It was a Structured Questionnaire which consists of series of questions related to the objective of the study. In the prepared questionnaire, eighteen closed-end questions with one open-ended question were

designed. The questionnaire was prepared with the help of different Scaling Techniques and Measurement Scales.

2.6 Data Analysis

Primary data generated by the study were cleaned to ensure consistency and transcribed in coded form (pre and post-coded) into the computer using the Statistical Package for Social Sciences (SPSS). There are five different Statistical tools are used in this project to analyze the data effectively. It includes the advanced statistical tools also. The Statistical tools used to analyze are mentioned as follows.

1. T-Test for Single Mean

2. T-Test for difference of two mean 3. ANOVA – One Way ANOVA

4. Chi-Square test for independence of attributes 5. Correlation Coefficient

6. Friedman Test

In the analysis, the Ordinal Scale for the questionnaire, ‘Features of the product’, the scale value was set as follows: 1 – 1 point, 2 – 2 points, 3 – 3points, 4 – 4 points and 5 – 5 points. So, the highest mean value is considered while writing the inference for this questionnaire. Other than this, for all other questionnaire which involves the rating scale, the scale value was set least for higher rating and greater for lower rating. For example, Very High – 1, High – 2, Average – 3, Low – 4, Very Low – 5. So, the least mean value is considered while writing inference for the other questionnaires.

T-Test for Single Mean:

The t- test is the most powerful parametric test for calculating the significance of a small sample mean. A one sample t-test has the following null hypothesis:

Where, the Greek letter μ (mu) represents the population mean and c represents its assumed (hypothesized) value. In statistics it is usual to employ Greek letters for population parameters and Roman letters for sample statistics. The t-test is the small sample analog of the z test which is suitable for large samples. A small sample is generally regarded as one of size n<30.

A t-test is necessary for small samples because their distributions are not normal. If the sample is large (n>=30) then statistical theory says that the sample mean is normally distributed and a z test for a single mean can be used. This is a result of a famous statistical theorem, the Central limit theorem.

A t-test, however, can still be applied to larger samples and as the sample size n grows larger and larger, the results of a t-test and z-test become closer and closer. In the limit, with infinite degrees of freedom, the results of t and z tests become identical.

In order to perform a t-test, one first has to calculate the "degrees of freedom." This quantity takes into account the sample size and the number of parameters that are being estimated. Here, the population parameter, mu is being estimated by the sample statistic x-bar, the mean of the sample data. For a t-test the degrees of freedom of the single mean is n-1. This is because only one population parameter (the population mean) is being estimated by a sample statistic (the sample mean).

T-Test for difference of two mean:

The Independent Samples T Test compares the mean scores of two groups on a given variable. One of the frequently used t-test is a two sample location test of the null hypothesis that the means of two normally distributed populations are equal. All such tests are usually called Student's t-tests, though strictly speaking that name should only be used if the variances of the two populations are also assumed to be equal; the form of the test used when this assumption is dropped is sometimes called Welch's t-test. These tests are often referred to as "unpaired" or "independent samples" t-tests, as they are typically applied when the statistical units underlying the two samples being compared are non-overlapping.

Independent two-sample t-test for Unequal sample size and equal variance

This test is used only when it can be assumed that the two distributions have the same variance. The t statistic to test whether the means are different can be calculated as follows:

Where,

Note that the formulae above are generalizations for the case where both samples have equal sizes (substitute n1 and n2 for n).

is an estimator of the common standard deviation of the two samples: it is defined in this way so that its square is an unbiased estimator of the common variance whether or not the population means are the same. In these formulae, n = number of participants, 1 = group one, 2 = group two. n − 1 is the number of degrees of freedom for either group, and the total

sample size minus two (that is, n1 + n2 − 2) is the total number of degrees of freedom, which

is used in significance testing.

ANOVA:

In statistics, one-way analysis of variance (abbreviated one-way ANOVA) is a technique used to compare means of two or more samples (using the F distribution). This technique can be used only for numerical data.

The ANOVA tests the null hypothesis that samples in two or more groups are drawn from the same population. To do this, two estimates are made of the population variance. These estimates rely on various assumptions. The ANOVA produces an F statistic, the ratio of the variance calculated among the means to the variance within the samples. If the group means are drawn from the same population, the variance between the group means should be lower than the variance of the samples, following central limit theorem. A higher ratio therefore implies that the samples were drawn from different populations.

The degrees of freedom for the numerator is I-1, where I is the number of groups (means). The degrees of freedom for the denominator is N - I, where N is the total of all the sample sizes.

Typically, however, the one-way ANOVA is used to test for differences among at least two groups, since the two-group case can also be covered by a t-test (Gosset, 1908). When there are only two means to compare, the t-test and the F-test are equivalent; the relation between ANOVA and t is given by F = t2_.

Grand Mean

The grand mean of a set of samples is the total of all the data values divided by the total sample size. This requires that you have all of the sample data available to you, which is usually the case, but not always. It turns out that all that is necessary to find perform a one-way analysis of variance are the number of samples, the sample means, the sample variances, and the sample sizes. Another way to find the grand mean is to find the weighted average of the sample means. The weight applied is the sample size.

Total Variation

The total variation (not variance) is comprised the sum of the squares of the differences of each mean with the grand mean.

There is the between group variation and the within group variation. The whole idea behind the analysis of variance is to compare the ratio of between group variance to within group variance. If the variance caused by the interaction between the samples is much larger when compared to the variance that appears within each group, then it is because the means aren't the same.

Between Group Variation

The variation due to the interaction between the samples is denoted SS(B) for Sum of Squares Between groups. If the sample means are close to each other (and therefore the Grand Mean) this will be small. There are k samples involved with one data value for each sample (the sample mean), so there are k-1 degrees of freedom.

The variance due to the interaction between the samples is denoted MS(B) for Mean Square Between groups. This is the between group variation divided by its degrees of freedom. It is

also denoted by .

Within Group Variation

The variation due to differences within individual samples, denoted SS(W) for Sum of Squares Within groups. Each sample is considered independently, no interaction between samples is involved. The degrees of freedom is equal to the sum of the individual degrees of freedom for each sample. Since each sample has degrees of freedom equal to one less than their sample sizes, and there are k samples, the total degrees of freedom is k less than the total sample size: df = N - k.

The variance due to the differences within individual samples is denoted MS(W) for Mean Square Within groups. This is the within group variation divided by its degrees of freedom. It

is also denoted by . It is the weighted average of the variances (weighted with the degrees of freedom).

F test statistic

Recall that a F variable is the ratio of two independent chi-square variables divided by their respective degrees of freedom. Also recall that the F test statistic is the ratio of two sample variances, well, it turns out that's exactly what we have here. The F test statistic is found by dividing the between group variance by the within group variance. The degrees of freedom for the numerator are the degrees of freedom for the between group (k-1) and the degrees of freedom for the denominator are the degrees of freedom for the within group (N-k).

Chi-Square Test for Independence of Attributes:

The test is applied when you have two categorical variables from a single population. It is used to determine whether there is a significant association between the two variables. Suppose N observations are considered and classified according two characteristics say A and B. We may be interested to test whether the two characteristics are independent. In such a case, we can use Chi square test for independence of two attributes.

It has to be noted that the Chi square goodness of fit test and test for independence of attributes depend only on the set of observed and expected frequencies and degrees of freedom. These two tests do not need any assumption regarding distribution of the parent population from which the samples are taken.

Since these tests do not involve any population parameters or characteristics, they are also termed as non-parametric or distribution free tests. An additional important fact on these two tests is they are sample size independent and can be used for any sample size as long as the assumption on minimum expected cell frequency is met.

where r is the number of levels for one categorical variable, and c is the number of levels for the other categorical variable.

• Expected frequencies: The expected frequency counts are computed separately for

each level of one categorical variable at each level of the other categorical variable. Compute r * c expected frequencies, according to the following formula.

Er,c = (nr * nc) / n

where Er,c is the expected frequency count for level r of Variable A and level c of

Variable B, nr is the total number of sample observations at level r of Variable A, nc is

the total number of sample observations at level c of Variable B, and n is the total sample size.

• Test statistic: The test statistic is a chi-square random variable (Χ2_{) defined by the}

following equation. Χ2 _{= Σ [ (O}

r,c - Er,c)2 / Er,c ]

where Or,c is the observed frequency count at level r of Variable A and level c of

Variable B, and Er,c is the expected frequency count at level r of Variable A and level

c of Variable B.

P-value: The P-value is the probability of observing a sample statistic as extreme as the test

statistic. Since the test statistic is a chi-square, use the Chi-Square Distribution Calculator to assess the probability associated with the test statistic. Use the degrees of freedom computed above.

Correlation Coefficient:

Correlation is one of the statistical tools very widely applied as a tool of analysis in every subject. It is a statistical measure of establishing qualitative relationship between two or more variables. Through correlation, it is possible to indicate the direction of relationship between variables. In research, whenever qualitative variables are used, their relationship is studied through correlation. Correlation is measured applying different methods in statistics. They are, Graphical method, Scatter diagram method, Karl Pearson’s coefficient of correlation and Spearman’s Rank correlation. A very important point to note is that correlation value for any set of values should not exceed +1 or -1.

The formula for Pearson's correlation takes on many forms. A commonly used formula is shown below.

A simpler looking formula can be used if the numbers are converted into z scores:

where zx is the variable X converted into z scores and zy is the variable Y converted into z

scores.

Friedman Test:

The Friedman test is a non-parametric test for testing the difference between several related samples. The Friedman test is an alternative for repeated measures analysis of variances which is used when the same parameter has been measured under different conditions on the same subjects.

CHAPTER 3

REVIEW OF LITERATURE

Brand and branding defined

It is widely acknowledged amongst both practitioners and academics that branding has become a tool of strategic importance. Various definitions of branding appear in literature. The American Marketing Association (1994) defines a brand as a “name, term, sign, symbol or design, or a combination of them intended to encourage prospective customers to differentiate a producer’s product (s) from those of competitors”.

A primary function of the brand is to provide convenience and clarity in decision making by providing a guarantee of performance and communicating a set of expectations thereby offering certainty and facilitating the buying process. On the emotional side, the function of a brand is to evoke a set of associations and furthermore symbolize the consumer’s persona through brand imagery.

However, this and other definitions of a brand fail to capture the essence of what branding involves or achieves (Marketing in a Global Economy Proceedings, 2000). In order to be successful, images and symbols must relate to and indeed exploit the needs, values and lifestyles of consumers in such a way that the meanings involved give added values, and differentiate the brand from other brands (Broadbent and Cooper, 1987).

In its totality, a brand can be described as a “trademark that communicates a promise (Phillips, 1988). This promise involves a set of symbolic and functional attributes that the market place associates with the brand. Symbolic attributes are those that fulfill internally generated needs for self-enhancement, role position, group membership or ego identification (Park et al., 1996) whereas functional brand attributes solve an externally generated consumption related problem.

Ambler and Styles (1996) describe two different views of defining a brand. The first is the product plus view, when the brand is seen as an addition to the product, and in this view a brand is also called an identifier. The second is the holistic view that communicates the focus on the brand itself that is considered to be much more than just the product. The brand is said to be the sum total of all elements of the marketing mix. Brands can also be explained based on their elements-“those trademarkable devices that serve to identify and differentiate the brand (ego, brand names, logos, symbols, characters, slogans, jingles and packages (Keller, 2002).

DeChernatony and MacDonald (1998) in an attempt to emphasize the increased value that accrues to the consumer by buying the established brand rather than a generic or commodity product, offer the following definition of a brand: “A successful brand is an identifiable product, service, person or place, augmented in such a way that the buyer or user perceives

relevant, unique added values which match their needs most closely. Furthermore, its success results from being able to sustain those added values in the face of competition”.

Some people distinguish the psychological aspect of a brand from the experiential aspect. The experiential aspect consists of the sum of all points of contact with the brand and is known as the brand experience. The psychological aspect, sometimes referred to as the brand image, is a symbolic construct created within the minds of people and consists of all the information and expectations associated with a product or service.

People engaged in branding seek to develop or align the expectations behind the brand experience, creating the impression that a brand associated with a product or service has certain qualities or characteristics that make it special or unique. A brand is therefore one of the most valuable elements in an advertising theme, as it demonstrates what the brand owner is able to offer in the marketplace. The art of creating and maintaining a brand is called brand management whereas orientation of the whole organization towards its brand is called brand orientation.

Careful brand management seeks to make the product or services relevant to the target audience. Brands should be seen as more than the difference between the actual cost of a product and its selling price - they represent the sum of all valuable qualities of a product to the consumer. There are many intangibles involved in business, intangibles left wholly from the income statement and balance sheet which determine how a business is perceived. The learned skill of a knowledge worker, the type of mental working, the type of stitch: all may be without an 'accounting cost' but for those who truly know the product, for it is these people the company should wish to find and keep, the difference is incomparable. A brand which is widely known in the marketplace acquires brand recognition. When brand recognition builds up to a point where a brand enjoys a critical mass of positive sentiment in the marketplace, it is said to have achieved brand franchise.

One goal in brand recognition is the identification of a brand without the name of the company present. Consumers may look on branding as an important value added aspect of products or services, as it often serves to denote a certain attractive quality or characteristic (see also brand promise). From the perspective of brand owners, branded products or services also command higher prices. Where two products resemble each other, but one of the

products has no associated branding (such as a generic, store-branded product), people may often select the more expensive branded product on the basis of the quality of the brand or the reputation of the brand owner.

Brand Awareness

Brand awareness refers to customers' ability to recall and recognize the brand under different conditions and link to the brand name, logo, jingles and so on to certain associations in memory. It helps the customers to understand to which product or service category the particular brand belongs to and what products and services are sold under the brand name. It also ensures that customers know which of their needs are satisfied by the brand through its products. (Keller) 'Brand love', or love of a brand, is an emerging term encompassing the perceived value of the brand image. Brand love levels are measured through social media posts about a brand, or tweets of a brand on sites such as Twitter. Becoming a Facebook fan of a particular brand is also a measurement of the level of 'brand love'.

Brand Preference

Brand Preference is the measure of Brand Loyalty in which a consumer will choose a particular brand in presence of competing brands, but will accept substitutes if that brand is not available. Brand Loyalty refers to the extent of the faithfulness of consumers to a particular brand, expressed through their repeat purchases, irrespective of the marketing pressure generated by the competing brands.

Analysis Process

Fig 3.1: Project Study Analysis Process BP is a measure

BL expressed thru

RP is based on CS

Cust will get satisfied when CE met or exceed

After Purchase

To analyze the purchasing process, it is necessary to analyze the buying

Consumer Buying Behavior

Consumer behavior as a body of knowledge emphasizes on the study of both physical activities and decision-making processes that occur in the process of search, evaluation, acquiring, use and disposal of products. Consumer behavior encompasses vast areas of human activities that have direct interface with technology. Borrowing heavily from diverse sweep and come in handy to adapt technology to everyday needs of society. Backed by abundant wealth of information on areas such as consumers’ tastes, shopping habits, store patronage and life style, it has become possible for many marketing research firms to come up with reliably accurate work on many aspects of marketing including product demand forecast, perception of brand image, brand preference, brand loyalty and brand equity position. This approach to problems in marketing management seems to have been well established and therefore, is the popular means adopted in the area of consumer product whether it is physical product or services.

Consumer behavior is the study of when, why, how, and where people do or do not buy a

product. It blends elements from psychology, sociology, social anthropology and economics. It attempts to understand the buyer decision making process, both individually and in groups. It studies characteristics of individual consumers such as demographics and behavioral variables in an attempt to understand people's wants. It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general.

Customer behaviour study is based on consumer buying behavior, with the customer playing the three distinct roles of user, payer and buyer. Relationship marketing is an influential asset for customer behaviour analysis as it has a keen interest in the re-discovery of the true meaning of marketing through the re-affirmation of the importance of the customer or buyer. A greater importance is also placed on consumer retention, customer relationship management, personalisation, customisation and one-to-one marketing. Social functions can be categorized into social choice and welfare functions.

Each method for vote counting is assumed as social function but if Arrow’s possibility theorem is used for a social function, social welfare function is achieved. Some specifications of the social functions are decisiveness, neutrality, anonymity, monotonicity, unanimity, homogeneity and weak and strong Pareto optimality. No social choice function meets these

requirements in an ordinal scale simultaneously. The most important characteristic of a social function is identification of the interactive effect of alternatives and creating a logical relation with the ranks. Marketing provides services in order to satisfy customers. With that in mind, the productive system is considered from its beginning at the production level, to the end of the cycle, the consumer (Kioumarsi et al., 2009).

Factors influencing Consumer Behavior

The starting point for understanding consumer buying behavior is the stimulus – response model. It is generally known as Black Box Model. As this model shows, both marketing and environmental stimuli enter the buyer’s consciousness. In turn, the buyer’s characteristics and decision process lead to certain purchase decisions. The marketer’s task is to understand what happens in the buyer’s consciousness between the arrival of outside stimuli and the buyer’s purchase decisions. This model indicates, a consumer’s buying behavior is influenced by cultural, social, personal, and psychological factors. Knowledge of such factors that influence consumer behavior can help to predict how consumers will respond to their products.

Table 3.1: Black box model

ENVIRONMENTAL FACTORS BUYER'S BLACK BOX

BUYER'S RESPONSE Marketing Stimuli Environmental Stimuli Buyer

Characteristics Decision Process

Product Price Place Promotion Economic Technological Political Cultural Demographic Natural Attitudes Motivation Perceptions Personality Lifestyle Knowledge Problem recognition Information search Alternative evaluation Purchase decision Post-purchase behavior Product choice Brand choice Dealer choice Purchase timing Purchase amount

The black box model shows the interaction of stimuli, consumer characteristics, and decision process and consumer responses. It can be distinguished between interpersonal stimuli (between people) or intrapersonal stimuli (within people). The black box model is related to the black box theory of behaviorism, where the focus is not set on the processes inside a consumer, but the relation between the stimuli and the response of the consumer. The marketing stimuli are planned and processed by the companies, whereas the environmental stimulus is given by social factors, based on the economical, political and cultural

circumstances of a society. The buyer’s black box contains the buyer characteristics and the decision process, which determines the buyer’s response.

The black box model considers the buyers response as a result of a conscious, rational decision process, in which it is assumed that the buyer has recognized the problem. However, in reality many decisions are not made in awareness of a determined problem by the consumer.

Culture

Culture encompasses the values, arts, customs and skills of people in a given society. Cultural trends reflect the social values of the population and, as such, have important implications for market segmentation, product development, advertising and other aspects of marketing strategy. Social class categories can be identified by income, education level and occupation. The relationship between social class and purchasing patterns, nevertheless, provides an important link for marketers in strategy planning.

Culture includes the basic values, perceptions, preferences, and behaviors that a person learns from family and other key institutions. Subcultures are “cultures within cultures” that have distinct values and lifestyles. People with different cultural, subcultural and social class characteristics have different products and brand preferences.

Social Factors

Social factors also influence a buyer’s behavior. A person’s reference groups such as, family, friends, social organizations, professional associations strongly affect product and brand choices. The person’s position within each group can be defined in terms of role and status. A buyer chooses products and brands that reflect his or her role and status.

The buyer’s age, life-cycle stage, occupation, economic circumstances, lifestyle, personality and other personal characteristic influence his or her buying decisions. Young consumers have different needs and wants from those who are old; consumers with higher incomes buy differently from those who have less to spend. Consumer lifestyles have also an important influence on buyer’s choices.

TYPES OF BUYING BEHAVIOR

The following are the several types of buying behavior that resides with everyone.

Dissonance-Reducing Buying Behavior

It occurs when consumers are highly involved with an expensive, infrequent, or risky purchase, but see little difference among brands. For example, consumers buying carpets may face a high-involvement decision because carpet is expensive and self-expressive. In this case, because perceived differences are not large, buyers may shop around to learn what is available, but buy relatively quickly. They may respond primarily to a good price or to a purchase convenience. After the purchase, consumers might experience post-purchase dissonance (after-sale discomfort) when they notice certain disadvantages of the purchased carpet brand or hear favorable things about brands not purchased. To counter such dissonance, the marketer’s after-sale communications should provide evidence and support to help consumers feel good about their brand choices.

Habitual Buying Behavior

It occurs under conditions of low consumer involvement and little significant brand difference. For example, take salt. Consumers have little involvement in this product category; they simply go to the store and reach for a brand. If they keep reaching for the same brand, it is out of habit rather than strong brand loyalty. Consumers appear to have low involvement with most low-cost, frequently-purchase products. Because they are not highly involved with the product, consumers may not evaluate choice after purchase. Thus, the buying process involves brand beliefs formed by passive learning, followed by purchase behavior, which may not evaluate the choice even after purchase behavior, which may or may

not be followed by evaluation. As buyers are not highly committed to any brand, marketers of low involvement products with few brand differences often use price and sales promotions to stimulate product trail.

Variety Seeking Buyer Behavior

Consumers undertake variety-seeking buying behavior in situations characterized by low consumer involvement, but significant perceived brand differences. In such cases, consumers often do a lot of brand switching. For example, when purchasing cookies, a consumer may hold some beliefs, choose a cookie brand without much evaluation, then evaluate that brand during consumption. But the next time, the consumer might pick another brand out of boredom or simply to try something different. Brand switching occurs for the sake of variety rather than because of dissatisfaction. The market leader will try avoiding out-of-stock conditions, and running frequent reminder advertising. Challenger firms will encourage variety seeking by offering lower prices, deals, coupons, free samples and advertising that presents reasons for trying something new.

Impulse and Planned Buying

The purchase of an ice cream may be planned or made on impulse. In some cases, a purchase may be planned in advance, but the timing of the actual purchase may be decided on the impulse of the moment. Impulse buying is sometimes classified into reminder buying or suggestion buying. National advertisers try through displays in retail stores to remind the buyer of products he has seen advertised. Toothpaste is an example.

Suggestion buying occurs when the consumer’s sees a product displayed and realizes that he could use it. An example would be a cigarette lighter. Impulse buying has grown particularly with the development of the self-service retail store.

BUYING DECISIONS

Consumer buying behavior is influenced by the buyer’s decision making process. The buying situation can vary from one of routine-response behaviors to limited problem solving to extensive problem solving. Buying is not a single act but a multi-component decision on the need class, generic class, product class, product form, brand, vendor, quantity, timing and method of payment. The buyer goes through a process consisting of need arousal,

information search, evaluation behavior, purchase decision and post-purchase feelings. At each decision stage, characteristics of the buyer, product, seller and selling situation interact to influence the buying outcome. A person’s buying behavior is the result of the complex interplay of all these cultural, social, personal, and psychological factors. More complex decision usually involve more buying participants and more buyer deliberation. Consumers undertake complex buying behavior when they are highly involved in a purchase and perceive significant differences among brands. Marketers of high-involvement products must understand the information gathering and evaluation behavior of high-involvement consumers.

Fig 3.2: Buying Decision Process Need Recognition

The buyer senses a difference between his or her actual state and some desired state. The need can be triggered by internal stimuli when one of the person’s normal needs – hunger, thirst, sex, etc. rise to a high enough to become a drive. From previous experience, the person has learned how to cope with this drive and is motivated toward objects that he or she knows will satisfy it.

Information Search

The consumer can obtain information from any of several sources. These include: personal sources (family, friends, neighbors, and acquaintances), commercial sources (advertising, salespeople, dealers, packaging and displays), public sources (mass media, consumer-rating organizations) and experimental sources (handling, examining and using the product).

The relative influence of these information sources varies with the product and the buyer. The most effective sources, however, tend to be personal. Personal sources appear to be even more important in influencing the purchase of services. Commercial sources normally inform the buyer, but personal sources legitimize or evaluate products for the buyer. The marketer should carefully identify consumer’s sources of information and the importance of each source.

Consumers should be asked how they first heard about the brand, what information they received, and the information is critical in preparing effective communication strategies

aimed at target markets. Word-of-mouth communication can have a significant impact on purchase decisions. The search for information usually leads to the establishment of criteria for choosing among specific brands. Consumers are usually aware of some brands and unaware of others. Those they are aware of fall into an inert set, an inept set or an evoked set. The final choice will be made from the latter. The costs involved in searching for information, sometimes outweigh the benefits.

Evaluation of Alternatives

The marketer needs to know about the alternative evaluation, that is, how the consumer processes information to arrive at brand choices. Each consumer is trying to satisfy some need and is looking for certain benefits that can be acquired by buying product or service. Further, each consumer sees a product as a bundle of attributes with varying capacities for delivering these benefits and satisfying the need. Marketers should be more concerned with attribute importance than attribute salience.

The consumer’s beliefs held about a particular attribute are based on his or her experience and the effect of selective perception, selective distortion and selective retention. The utility function shows how the consumer expects total product satisfaction to vary with different levels of different attributes.

Purchase Decision

Purchase decisions often begin with trial purchases of limited quantities. Repeat purchases are closely related to brand loyalty. Store choice is an important factor in purchase decisions. The bulk of consumer spending occurs in stores, but catalog sales comprise an increasing percentage of retail sales. The purchase decision includes decisions on financing, installation, related products and services. The marketing implications of purchase decisions depend on whether a mass-marketing approach or market-segmentation approach is adopted. Generally, the consumer’s purchase decision will be to buy the most preferred brand, but two factors can come between the purchase intention and the purchase decision. They are attitudes of others and unexpected situational factors.

Fig 3.3: Steps between Purchase Intention & Purchase Decision

A consumer’s decision to change, postpone, or avoid a purchase decision is influenced heavily by perceived risk. Many purchases involve some risk taking. Anxiety results when consumers cannot be certain about the purchase outcome. The amount of perceived risk varies with the amount of money at stake, the amount of purchase uncertainty, and the amount of consumer self-confidence. A consumer takes certain actions to reduce risk, such as avoiding purchasing decisions, gathering more information, and looking for national brand names and products with warranties. The marketer must understand the factors that provoke feelings of risk in consumers and must provide information and support that will reduce the perceived risk.

Post-Purchase Behavior

In the post-purchase evaluation, consumers compare the product’s performance against their expectations. Cognitive dissonance occurs when consumers feel a discrepancy between their

EVALUATION OF ALTERNATIVES Purchase IntentionPurchase DecisionAttitude of others Unexpected Situational Factors

expectations of a product and its performance. Follow-up advertising can be designed to reassure consumers that they have made the right choice. Consumers base their expectations on messages they receive from sellers, friends and other information sources. If the seller exaggerates the product’s performance, consumer expectations will not be met, a situation that leads to dissatisfaction. The larger the gap between expectations and performance, the greater is the consumer’s dissatisfaction. On the other hand, every purchase involves compromise. Consumers feel uneasy about acquiring the drawbacks of the chosen brand and about losing the benefits of the brands not purchased. Thus, consumers feel at least some post-purchase dissonance for every purchase. A satisfied customer buys again, talks favorably to others about the product, pays less attention to competing brands and advertising and buys other products from the company.

3.2 Research Studies

Niedrich Ronald W. and Swain Scott D (2003), in their article titled, “The Influence of Pioneer Status and Experience Order on Consumer Brand Preference: A Mediated-Effects Model” found: Within the behavioral literature, two basic explanations of the

pioneering advantage had been offered. Early work focused on order-based explanations. More recently, schema-based explanations had also been suggested. The authors proposed a mediated-effects model of the pioneering advantage and test the model in two separate longitudinal studies. Both experiments support the proposed model. The authors found that experience order and pioneer-status have additive effects on brand preference such that perceptions of first-in-market and first-experienced brands are more favorable, suggesting that both explanations are operative. The authors also provide evidence that the effects of pioneer status on brand preference are mediated by attitude toward the brand and company credibility, while the effects of experience order on brand preference are mediated by attitude toward the brand and attribute recall. These data support the notion that the effect of pioneer status on brand preference was the result of both brand-level and company-level associations.

Dr. Rajagopal (2009), in his article titled, “Conational Drivers Influencing Brand Preference Among Consumers” discussed: Consumers recognize brands by building

favorable attitude towards them and through the purchase decision process. Brand preference is understood as a measure of brand loyalty in which a consumer exercises his decision to choose a particular brand in presence of competing brands. The study aimed at discussing the cognitive factors that determine brand preference among consumers based on empirical research. Brand attributes including emotions, attitudes, personality, image, reputation and trust which influence consumer perceptions and temporal association with brands are critically examined in the study. The study revealed that higher brand relevance and trust build strong the association of consumers with brand in long-run.

Purohit H.C (2008), in his article titled, “Customer Relationship Management and Brand Loyalty Through Word Of Mouth (WOM) Communication” discussed: Customer loyalty

is not a choice any longer with business; it is the only way of building a sustainable competitive advantage. Building loyalty with key customers had become a core marketing objective shared by key players in all industries catering to business customers. Communication with customer partners is a necessary process of relationship marketing. It helps in relationship development, foresters trust, and provides the information and knowledge needed to undertake cooperative and collaborative activities of relationship marketing. CRM refers to a conceptually broad phenomenon of business activity; if the phenomenon of cooperation and collaboration with customers become the dominant paradigm of marketing practice the satisfaction level of the consumers goes high up to the level of delight. The building of customer relationship was a fundamental business of every enterprise and it requires a holistic strategy and process to make it successful. The proposed study will focus on the issues related with customer satisfaction, repeat purchase behavior, building consumer relationship management through customer loyalty and suggest the measures to minimize the challenges of a highly competitive global market.

Sha Yang, Gerg M. Allenby and Geraldine Fennel (2002), in their article titled, “Modeling Variation in Brand Preference: The Roles of Objective Environment and Motivating Conditions” discussed: People consume products in a variety of environments.