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A STUDY OF CONSUMER PERCEPTION & BEHAVIOUR TOWARDS PASSENGER CARS IN TIRUR

K.P. NAJEEMUDEEN, RReesseeaarrcchh SScchhoollaarr -- PPhh..DD,, KKaarrppaaggaamm UUnniivveerrssiittyy,, CCooiimmbbaattoorree,, TTNN

Dr. N. PANCHANATHAM, PPrrooffeessssoorr && HHeeaadd,, DDeeppaarrttmmeenntt ooff BBuussiinneessss AAddmmiinniissttrraattiioonn,, AAnnnnaammaallaaii UUnniivveerrssiittyy,, CChhiiddaammbbaarraamm,, TTNN

ABSTRACT

It is rightly said ‘Yesterday’s luxuries are today’s necessities’. Cars though considered as luxury once, now occupies an important part in day to day life and has become a necessity. A car satisfies the need of owners for transportation. They also provide psychological satisfaction from the pride of possession. The post globalization era has witnessed the footprints of global automobile giants marching towards India to tap India’s highly potential passenger car market. As a result customers are flooded with a wide variety of options to choose from. Understanding how consumers make purchase decisions can help marketing managers in several ways. For example, if a manager knows through research that fuel mileage is the most important attribute for a certain target market, the manufacturer can redesign the product to meet that criterion. In such a way the understanding of consumer behavior and customer psychology helps the marketer to identify customer needs and plan his production and marketing activities accordingly. This study tends to analyse the impact of customer perception and behavior in the purchase decision of passenger cars.

INTRODUCTION

Over the past two decades, the face of the world consumer has truly changed. The era of liberalization, privatization and globalization (LPG) has brought changes in society and lifestyle of people. Goods are more available, information about these goods is more open and accessible, and the ability to buy these goods from any nook and corner of the earth has become possible. With the market being flooded with many me-too products the competition has become intense. Consumers around the world vary tremendously in age, income, education level and tastes. How these diverse consumers relate with each other elements of the world around them impacts their choices among the incredible variety of goods and services available to them in the market. As a result, the need to understand consumers and consumer behaviour has become a hot topic around the globe, from boardroom and executive suites to universities and hospitals now than ever before.

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Consumer behaviour as a discipline focuses on how individuals make decisions to spend their available resources (time, money, effort) on consumption related items. That includes what, why, when, where, how often they buy it, how they evaluate it after the purchase and the impact of such evaluation on future purchase. The study of consumer behaviour also tends to analyse a fascinating array of factors that influence purchase decisions and product use. But it is seldom easy and sometimes impossible to understand or predict human behaviour, particularly when it comes to decision making. It is a difficult and complicated task, filled with uncertainties, risks and surprises because each individual is a unique product of heredity, environment and experience. Accurate predictions can yield vast as well as fast fortunes and inaccurate predictions can result in the loss of millions of rupees. For this reason, the buyer’s mind has been termed as a black box, which should be opened by the seller to be a successful marketer.

In this digital era car is no more a luxury product. It has become a day to day necessity. Now a day, people have started buying cars for business purpose, personal use or for showing their prestige and social status. A proper understanding of the likes and dislikes of the car users will help the car marketers to plan and design their product in such a way that it provides maximum level of satisfaction to it end users. This study tends to flash some light upon the factors that influence the buying decision of the customers, particularly in case of passenger cars. For the purpose of this study, the personal variables like age, income, education, occupation etc. of the customer have been collected and the influence of these personal variables on the consumers’ perception, their buying behaviour and the decision process have been analyzed.

STATEMENT OF THE PROBLEM

The emergence of globalization and liberalization has paved way for stiff competition among the variety of car industries which are focusing attention in capturing the Indian market. Cars though considered as luxury once, now occupies an important part in day to day life and has become a necessity. Tirur, the town which is selected for the study is one of the main growing markets for passenger cars. At present, the demand for the passenger cars is on the increase in the country. To be a successful marketer it is absolutely essential to read the minds and perceptions of the prospective buyers of cars. The present study attempts to analyze the variables that affect the buyer behaviour today.

REVIEW OF LITERATURE

Brown et al (2007) analyzed the consumers’ attitude towards European, Japanese and US cars. The country of origin plays a significant role in the consumers’ behaviour. The brand name, lower price and distributor’s reputation have a significant impact on the sale of passengers’ car.

Guiles (2008) identified that fuel economy and lower maintenance cost have its impact on the consumers’ behaviour towards the passenger car.

Baumgartner and Jolibert (2008) revealed that the car produced in West Germany received the highest rating on firm attitudes namely acceleration, safety, styling and workmanship among the Americans. At the same time, the Japanese car ranked highest on fuel economy and reliability.

Dornoff et al (2008) identified the market segment is the primary determinant of the consumer behaviour in the passenger car market. The level of expectation and perception on various attributes of car differ from consumers in one segment to another.

Dr. S. Subadra, Dr. K.M Murugesan and Dr. R. Ganapathi (2010) identified that driving comfort and fuel economy are the most important features of a passenger car followed by availability of spare parts and price of the car.

Dr. H.S Adithya (2013) identified that value for money and satisfaction are the two important factors for purchase of passenger cars. Brand name followed by popularity is the most frequent basis of selection of a brand. Advertisements are the main sources of knowledge about latest brands and trends.

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However, the present study differs from the above, in that the buyer behaviour in Tirur town in Malappuram district of Kerala state is sought to be analyzed here. The scope and the area of the study are unique in nature.

OBJECTIVES OF THE STUDY

The purpose of this research is to study the behaviour of consumers, perception of product attributes and level of satisfaction with respect to passenger cars. The following are the objectives:

To understand the proportion of car owners in Tirur.

The market share of different brands of passenger cars in Tirur.

To identify and analyze the factors influencing the purchase of cars.

RESEARCH METHODOLOGY

A sample of 201 consumers was selected for the present study around Tirur town which is in Malappuram district of Kerala. A structured questionnaire was designed and administered among the respondents to give a fair representation to various attributes of the consumers. The secondary data has been collected from various published articles, journals, magazines and also through the internet. For the purpose of evaluation, the percentages and weighted score test have been used for meaningful analysis and clear presentation.

Table 1: Market Share of Passenger Car Companies in Tirur

Company Name No. of Car Owners Maruti Suzuki 94 Hyundai 12 Toyota 10 Chevrolet 5 Tata 4 Others 12

From the above table we can understand that Maruti Suzuki is the brand of car with the highest number of market share in Tirur. 94 respondents among the 137 car owners in Tirur are having a car from Maruti Suzuki. 12 respondents are having Hyundai cars while 10 respondents own Toyota cars. 5 and 4 number of people responded to be having Chevrolet and Tata cars respectively while 12 people are having other brands like BMW, Fiat, Audi etc.

Purpose No. of Persons Personal Use 141 Professional Use 15 Rent a car / Taxi 8 Status Symbol 7

Table 2: Customer’s response on their purpose of buying a car

From the above table it can be understood that most of the people are buying a car for their personal use only as almost 141 people have responded in favour of it while only 15 respondents are using their cars for professional use. While 8 respondents expressed their intention for using their car for Rent a car or Taxi purpose, about 7 respondents are buying a car for prestige or as a status symbol. This indicates that, 82% of the people are buying a car for their personal use. Only 9% people are buying a car for professional use. While 5% of customers are buying car for Rent a car or Taxi purpose, 4% people are using their car as a status symbol.

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Table 3: Customers’ response about their Fuel choice

As per the above table, 82 respondents have opted for petrol as the fuel for their car while 87 respondents favoured diesel. Only 2 people are interested in LPG driven cars. It can be understood that 51% of the customers prefer Diesel as their fuel while 48% are in favour of Petrol. Just 1% of respondents favour LPG.

Purchase Mode No. of Persons

Ready Cash 53

Finance / Bank Loan 118

The above table reveals that most of the customers prefer to avail bank loan or other finance facilities for buying a car with 118 respondents in favour of Finance / Bank loan. Only 53 respondents are willing to purchase with Ready Cash. This denotes that about 69% of customers prefer to purchase cars using Bank Loans and Finance facilities while only 31% can afford to purchase cars paying Ready Cash.

Table 5: Customers’ response regarding the features influencing their buying decision

FFeeaattuurreess 11 22 33 44 55 66 77TToottaall

RRaannkk %%

SSppaaccee 9944 4488 2244 2200 88 44 33 11337799 33 1144..9966

SSttyyllee 7744 3322 4466 2299 1166 22 22 11330099 55 1144..2200

RReessaallee VVaalluuee 9911 4433 2244 2299 99 33 22 11336655 44 1144..8811

IInntteerriioorr 5511 3322 2288 1188 3333 1188 2211 11009977 77 1111..9900

CCoommffoorrtt 110077 5533 2200 1122 44 33 22 11443344 11 1155..5555

MMiilleeaaggee 9999 4499 2288 1177 55 22 11 11441155 22 1155..3355

EEnnggiinnee PPoowweerr 6633 2211 4444 3311 3322 66 44 11222200 66 1133..2233

From the above table we can understand that Driving cum Travel comfort is the prime factor that the customers are looking for while selecting their car. Mileage is the 2nd important factor while Interior space is in the 3rd position. Resale value is in the 4th rank. Style and design of the car also influences their selection with 5th rank while engine power and interior design shares 6th and 7th positions respectively.

Fuel Type No. of Persons Petrol 82 Diesel 87 LPG 2

Table 4: Customers’ response about the Mode of Purchase they prefer

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Table 6: Customer’s response regarding the other factors influencing their buying decisions

Feature 1 2 3 4 5 6 7 8 9 10 Total WS Rank

Price 98 48 27 16 4 1 1 1 3 2 1985 2 Brand Name 93 47 23 19 7 3 3 2 1 3 1951 3 Public Opinion 106 52 19 11 3 2 2 1 2 3 2004 1 Style & Design 90 42 23 28 8 2 3 2 1 2 1939 4 Technology 43 27 22 31 34 19 19 2 1 3 1653 9 Service Facility 62 20 43 30 31 5 4 3 2 1 1796 6 Discounts & Offers

45 26 24 21 30 23 27 2 2 1 1638 10

Advertisement 73 31 45 28 16 2 2 1 2 1 1888 5 Spare Parts availability

51 32 27 17 32 17 20 3 1 1 1703 7

Salesman's Personality & Skills

45 28 25 21 33 22 24 1 1 1 1660 8

From the above table we can learn that Public opinion or suggestions from referral group is the prime factor to influence the customers’ purchase decision of cars. Price is the 2nd factor while Brand name is in the 3rd position. Style and design of the car, advertisements, availability of service and spare parts facilities nearby also have an impact on their purchase decision. Salesman’s personality and communication also have a major role while the engine technology of the car is not much bothered about. But it is evident that unless all the other factors are favourable, discounts and offers cannot induce customers’ to buy a particular model of car.

FINDINGS

The major findings from this study are:

The fact that about 68% of the population in Tirur owns a car indicates that Tirur is a very good market for passenger cars.

Maruti Suzuki is the market leader in Tirur. It is far ahead of its nearest competitor Hyundai with almost 8 fold of the market share of the latter.

Customers prefer petrol and diesel cars alike. There is not much demand for LPG driven vehicles in Tirur.

Driving cum Travel comfort is the prime factor that the customers are looking for while selecting their car. Mileage, Interior Space and Resale value are the other influencing features.

Public opinion or suggestions from referral group is the prime factor that influences the customers’ purchase decision of cars. Price, Brand name, Style and design of the car, advertisements, availability of service and spare parts facilities nearby are also important. Salesman’s personality and communication skills also influence the customers. But without a good public review no any offer or cash discount can help the car marketer to boost the sale.

RECOMMENDATIONS

To ensure that a product finds a place in the minds of consumers, the manufacturers should position their products through sales promotional activities and advertisement through all available media.

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Majority of the respondents reported that they formed their expectations through the statement made by friends and relatives and therefore it would be beneficial if the extent of influence of such groups is studied. It may be found through closely analysing the social interactions of the consumers.

Experts believe that the main driver of the Indian car market is the availability of car finance on easy installments at reasonable interest rates. Most of the respondents have reported that the easy availability of finance induces them to buy cars. So the car dealers should have tie-up arrangements with the authorized financial institutions to boost sales.

The respondents perceive that driving comfort and fuel economy are the most important features of the passenger car followed by availability of spare parts and price of the car. Hence the manufacturers should design the product giving maximum weightage to these factors.

Car owners feel that the hospitality shown by the dealers is more during their visits to the places of dealers before and immediately after the purchase. But after some time they face a problem with their dealers regarding after sales service. Therefore, it is suggested that the services rendered or to be rendered should be properly explained, friendly approach and reliability in service are to be further improved.

CONCLUSIONS

Consumer Behaviour consists of all human behaviour that goes in making purchase decisions. An understanding of the consumer behaviour enables a marketer to take marketing decisions which are compatible with its consumer needs. There are four major classes of consumer behaviour determinants and expectations, namely, cultural, socio-economic, personal and psychological. The growth in the population of India and the increasing number of middle class consumers has attracted the attention of car manufacturers and marketers. Realizing the importance of passenger car industry in the present economic situation, the researcher has analyzed the perceptions and behaviour of consumers that have a pivotal role to play in their purchasing decision of passenger cars. Also certain product attributes are identified as having a great influence over the purchase decision of the customers and satisfying them. The manufacturers and marketers who study the behaviour of consumers and cater to their needs will be successful. It may be concluded that consumer behaviour has a greater role to play in the LPG era of economic activities for which a necessary survey and research should be conducted in an efficient manner.

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