A WINTER PROJECT REPORT

ON

Sales and Distribution Of Bingo

‘Lays’ to ‘Bingo’

UNDER THE GUIDANCE

OF

Mr.Saurabh Bhatt

SUBMITTED BY: SUBMITTED TO:

Amit Gangwar Mr.Abhijeet Das

MBA (Co-ordinator, Academics)

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SHRI SIDDHI VINAYAK INSTITUTE OF MANAGMENT,

BAREILLY (U.P.)

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ACKNOWLEDGEMENT

I hereby, convey my sincere thanks to each and every person who has

helped me in the preparation of this project.

I express my gratitude towards time from their busy schedule.

I sincerely extend my gratefulness towards to Prof. RAJENDRA PRASAD

BHARTI (Director of LBSIMT), Mr. VIMAL NAVEEN CHOUDHRY

( Placements co-ordinator), Miss PAYAL JOHARI (faculty) and the entire

LBS family for their continuous guidance and motivation and aspiration

without which this study would not have been completed.

Besides I would like to add a note of thanks to all the customers/ people,

shopkeepers, students for their co-operation during my project.

And at last but obviously the most, I remain thankful to god and my

parents for giving me the guts for accepting the challenges, confidence to

work for it & patience to wait for the results.

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INDEX

SR.NO

.

PARTICULARS PAGE

NO.

1) Acknowledgement 2

4

2) Executive Summary 4

3) Introduction 5

4) Statement of Problem 6

5)Literature view

Consumer Behaviour 7

Marketing 12

Marketing Mix 14

Industry Overview 16

6) Aim of Study… 17

7) Scope and Coverage 18

8) Hypothesis 18

9) Research Design 19

10) Data Collection Method 19

11) Data Analysis and Interpretation 20

12) Conclusion and Recommendation 39

13) Annexure 41

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EXECUTIVE SUMMARY

The snacks industry has been escalating for the past so many years and will continue

to do so in the future. The snacks industry is very dynamic and so it calls for a close

monitoring of the latest happening.

The project was basically designed to understand the preference of the consumer in

the snakes industry. The main focus in this project is on two leading competitor in

this sector, i.e. Frito lays and newly launched bingo of ITC.

I had assigned the task of observing the changing preference of the consumer from

Frito Lays to ITC bingo and to come out with the factor, causing these changes.

The determinants used by us in the project to understand the changing preference

of the

consumer are as following

1. Novelty of the product.

2. Taste

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3. High decibel advertising campaign

4. Regional flavours

5. Distribution strengths

I tried to cover wide geographical area of Bareilly.Within those parts main areas

covered and I have taken a sample size of 100, and tried to cover all the age group

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INTRODUCTION

ITC Ltd's food division had forayed into the Rs 2,000-crore domestic branded, organized

snacks segment through its brand “Bingo”, with an investment of around Rs 150

crore, with the setting up of three new manufacturing plants across the country.

The launch of Bingo represents ITC Foods' fifth major line of foods business after

the highly successful Staples, Biscuits, Ready-to-Eat and Confectionery businesses.

Bingo is strategically timed around the World Cup to leverage the tremendous

popularity that such leisure and cocktail snacks will find among cricket lovers in the

country. So cricket lovers can enjoy their favorite matches while savoring an all-new

range of innovative Bingo snacks during this World Cup. The category of

snacks is characterized by a few organized players with limited offerings but the

unorganized sector continues to rule the market. However, the organized sector is one of

the fastest growing FMCG categories with an estimated growth rate of 30% annually [5]

.

The organized snacks category is sub-divided into the traditional

segment (Bhujia, chanachur etc.), Western segment (potato chips, cheese balls etc.)

and the newly established Finger snacks segment, which is an adaptation of traditional

offerings to the western format. The launch of Bingo is symbolic of ITC Foods'

distinct approach of introducing innovative and differentiated products in a largely

undifferentiated market place. The initial offerings from Bingo Include an array of

products in both Potato Chips & Finger Snacks segment. The Potato Chips offerings

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comprise of 4 innovative variants inspired by the snacking habits of different parts of

the country as well as Masalas, Salted and Tomato flavours. Additionally a south-

inspired dairy option has also been introduced under the potato chips offering.

The offerings under the Finger Snacks segment are equally unique

presentations with innovative finger foods like the pakoda inspired Live Wires,Khakra

inspired Mad Angles and the specially developed time pass snack in the form of Tedhe

Medhe. Each offering under this segment is available in two variants making it a total

of 6 products in the Finger Snacks portfolio. Speaking on the foray into this new

category, Mr. Ravi Naware, Divisional Chief Executive, ITC Limited - Foods Division

said, 'This is an exciting and fast growing category with a big untapped market. We

have extensively studied the market and our product development team has created

products with variants that will hold tremendous appeal to the Indian consumer. We are

confident that our retail distribution strength and our insightful understanding of

consumers will help us redefine this category just like we have done in other categories. An

added source of advantage is the strong farm linkages that ITC has developed for sourcing the

selected grades of potatoes that go into the making of the chips.'

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STATEMENT OF PROBLEM

The launch of Bingo was symbolic of ITC Foods' distinct approach of introducing

innovative and differentiated products in a largely undifferentiated market place. So the

problem here is shifting preferences of consumers from Frito Lays products to itc’s

Bingo products in snacks.

What makes people change preferences in snacks? This means we tried to understand

what variables affect the tastes and preference. We had used the following factors as

determinants to the study

1. Novelty of the product.

2. Taste

3. High decibel advertising campaign

4. Regional flavours

5. Distribution strengths

To understand how the variables like novelty, pricing of the products, brand value of

bingo, regional flavours, high decibel advertising, and the distribution strength of the

product affect the customer’s purchase preference.

RELEVANCE OF THE PROBLEM

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ITC's Bingo is giving PepsiCo’s Lays a run for its money. Pepsi’s

share in the Rs 2000 crore-snack market has dropped from 60 to 45% since the

launch of Bingo. ITC's retail success has forced Pepsi to renegotiate commercial terms

with the Future Group, which runs Big Bazaar. Retail tie-ups, regional flavours and

distribution muscle, had helped ITC to hit a bull’s eye with its snack Bingo. In less than

6 months, ITC's Bingo had managed to grab 16% market share and it hopes to touch 50%

in a year . Not an easy feat when battling Frito Lays for shelf space.

ITC's tie-up with Biyani's Future Group hurt Pepsi hard by forcing the company to

look at a revision of its commercial terms with the retail giant. While it has been a

flyer of a start, Pepsi still leads the overall Rs 2000 crore branded snack market with over

45% market share . Where ITC’s Bingo scores on distribution, Frito Lays rides high on

brand recall with Lays.

But ITC says they are confident of bridging the gap. Arch rival Pepsi on the

other hand will increase focus on Lehar namkeen, a category where ITC is yet to bite

into. Pepsi is looking to invest heavily on distribution. Apart from Rs 3 packs, to

penetrate further, the company is looking at new retail points like STD booths

and cyber cafes as well. The company is also looking in upping spends to make

inroads into the southern market, which continues to be dominated by regional

players (regional players-itcportal.com).

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REVIEW OF LITERATURE

Consumer Behavior

The study of consumers helps firms and organizations improve their marketing

strategies by understanding issues such as how

•The psychology of how consumers think, feel, reason, and select between

different alternatives (e.g., brands, products);

•The psychology of how the consumer is influenced by his or her environment

(e.g., culture, family, signs, media);

•The behavior of consumers while shopping or making other marketing decisions;

•Limitations in consumer knowledge or information processing abilities influence

decisions and marketing outcome;

•How consumer motivation and decision strategies differ between products that

differ in their level of importance or interest that they entail for the consumer; and

•How marketers can adapt and improve their marketing campaigns and marketing

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strategies to more effectively reach the consumer.

Understanding these issues helps us adapt our strategies by taking the consumer

into consideration. For example, by understanding that a number of different messages

compete for our potential customers’ attention, we learn that to be effective,

advertisements must usually be repeated extensively. We also learn that consumers will

sometimes be persuaded more by logical arguments, but at other times will be

persuaded more by emotional or symbolic appeals. By understanding the consumer,

we will be able to make a more informed decision as to which strategy to employ.

There are three main applications of consumer behavior:

The first and the most obvious is for marketing strategy—i.e., for making better

marketing campaigns. For example, by understanding that consumers are more

receptive to food advertising when they are hungry, we learn to schedule snack

advertisements late in the afternoon. By understanding that new products are

usually initially adopted by a few consumers and only spread later, and then only

gradually, to the rest of the population, we learn that-

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(1) Companies that introduce new products must be well financed so that they can stay

afloat until their products become a commercial success and,

(2) It is important to please initial customers, since they will in turn influence many

subsequent customers’ brand choices.

A second application is Public Policy.

Third application is Social Marketing .It involves getting ideas across to

consumers rather than selling something.

There are several units in the market that can be analyzed. But the main thrust is

the consumer. However, we will also need to analyze a firm’s strengths and weaknesses

and those of 5

Competing firms. Suppose, for example, a firm makes a product aimed at older

consumers, a growing segment. A competing firm that targets babies, a shrinking

market, is likely to consider repositioning toward the market. To assess a competing

firm’s potential threat, we need to examine its assets (e.g., technology, patents,

market knowledge, and awareness of its brands) against pressures it faces from the

market. Finally, we need to assess conditions (the marketing environment). For

example, although a firm may have developed a product that offers great appeal

for consumers, a recession may cut demand dramatically. Some of the important

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marketing environment conditions are-

Culture

Culture is a part of the external influences that impact the consumer. That is,

culture represents influences that are imposed on the consumer by other individuals.

The definition of Culture offered is "That complex whole which includes

knowledge, belief, art, morals, custom, and any other

capabilities and habits acquired by man person as a member

of society.”

Language is an important element of culture. It should be realized that

regional differences may be subtle. For example, one word may mean one thing in one

Latin American country, but something different in another. It should also be kept in

mind that much information is carried in non-verbal communication. In some cultures,

we nod to signify "yes" and shake our heads to signify "no;" in other cultures, the

practice is reversed.

Source: Hawkins

It should be noted that innovation is not always an

unqualifiedly good thing. Some innovations, such as infant formula adopted in

developing countries, may do more harm than good. Individuals may also become

dependent on the innovations. For example, travel agents who get used to booking

online may be unable to process manual reservations. Sometimes innovations are

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disadopted. For example, many individuals disadopt cellular phones if they find out that

they don’t end up using them much.

Attitudes

Definition: Consumer attitudes are a composite of a consumer’s

(1) Beliefs about,

(2) Feelings about, and

(3) Behavioral intentions toward some object--within the context of marketing, usually

a brand or retail store. These components are viewed together since they are highly

interdependent and together represent forces that influence how the consumer will react

to the object.

Beliefs

The first component is beliefs. A consumer may hold both positive beliefs

toward an object (e.g., coffee tastes good) as well as negative beliefs (e.g., coffee is

easily spilled and stains papers). In addition, some beliefs may be neutral (coffee is

black), and some may be differ in valance depending on the person or the situation

(e.g., coffee is hot and stimulates--good on a cold morning, but not well on a hot

summer evening when one wants to sleep). Note also that the beliefs that consumers

hold need not be accurate (e.g., that pork contains little fat), and some beliefs

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may, upon closer examination, be contradictory (e.g., that a historical figure was a good

person but also owned slaves).

Affect

Consumers also hold certain feelings toward brands or other objects. Sometimes

these feelings are based on the beliefs (e.g., a person feels nauseated when thinking about

a hamburger because of the tremendous amount of fat it contains), but there may also

be feelings which are relatively independent of beliefs. For example, an extreme

environmentalist may believe that cutting down trees is morally wrong, but may

have positive affect toward Christmas trees because he or she unconsciously

associates these trees with the experience that he or she had at Christmas as a child.

Roles and Status

A person participates in many groups – family, clubs, and organizations. The person’s

position in each group can be defined in terms of role and status. A role consists

of the activities that a person is expected to perform. Each role carries a status.

People choose products that communicate their role and status in society. Thus

CEOs drive Mercedes, etc. Marketers are aware of the status symbol potential of

products and brands.

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[1]

Personal factors

A buyer’s decisions are also influenced by personal characteristics. These include

the buyer’s age and stage in the life cycle, occupation, economic circumstances,

lifestyle and personality and self-concept.

Occupation & economic circumstances

Occupation also influences a consumption pattern. A company can even specialize

its products for certain occupational groups.

Product choice is greatly affected by economic circumstances

Spendable income (level, stability, time pattern), savings and assets (including the %

that

is liquid), debts, borrowing power, and attitude towards spending Vs saving.

Marketers of income-sensitive goods pay constant attention to trends in personal

income, savings and interest rates. If economic indicators point to a recession,

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marketers can take steps to redesign, reposition, and re price their products so they

continue to offer value to target customers.

Group Influences

Humans are inherently social animals, and individuals greatly influence each other.

A useful framework of analysis of group influence on the individual is the so called

reference group—the term comes about because an individual uses a relevant

group as a standard of reference against which oneself is compared. Reference groups

come in several different forms. The aspirational reference group refers to those others

against whom one would like to compare oneself. For example, many firms use athletes

as spokespeople, and these represent what many

people would ideally like to be.

Associative reference groups include people who more realistically represent the

individuals’ current equals or near-equals—e.g., coworkers, neighbors, or members of

churches, clubs, and organizations.

Finally, the dissociative reference group includes people that the individual would

not like to be like.

Reference groups come with various degrees of influence.

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• Primary reference groups come with a great deal of influence—e.g., members of

a fraternity/sorority.

• Secondary reference groups tend to have somewhat less influence—e.g., members

of a boating club that one encounter only during week-ends are likely to have their

influence limited to consumption during that time period.

Another typology divides reference groups into the informational kind (influence is

based almost entirely on members’ knowledge), normative (members influence what is

perceived to be "right," "proper," "responsible," or "cool"), or identification. The

difference between the latter two categories involves the individual’s motivation for

compliance. In case of the normative reference group, the individual tends to

comply largely for utilitarian reasons—dressing according to company standards is

likely to help your career, but there is no real motivation to dress that way outside the

job.

Buying roles

Initiator – Influencer – Decider – Buyer – User

Buying behavior

Complex buying behavior – three-step process – develops belief about the product,

attitude about the product and then makes a thoughtful choice.

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Dissonance reducing buying behavior – consumer is highly involved in a purchase but

sees little difference in brands. Marketing communication should supply beliefs and

evaluations that help the consumer feel good about his/her brand choice.

Habitual buying behavior – bought under conditions of low involvement and

absence of significant brand differences.

Variety seeking buying behavior – characterized by low involvement but

significant brand differences.

Loyal status

Consumers can be divided into 4 groups according to the brand loyalty status

• Hard-core loyals – one brand all the time

• Split loyals – loyal to 2 or 3 brands

• Shifting loyals – consumers who shift from one brand to another

• Switchers- not loyal to any brand.

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Perception

Human perception is an approximation of reality. Our brain attempts to make sense out

of the stimuli to which we are exposed. This works well, for example, when we "see" a

friend three hundred feet away at his or her correct height; however, our perception is

sometimes "off"—for example, certain shapes of ice cream containers look like

they contain more than rectangular ones with the same volume.

Marketing

Defining Marketing

Philip Kotler :

We see marketing management as the art and science of choosing target markets

and getting, keeping and growing customers through creating, delivering and

communicating superior customer value.

Product or offering:

A product is any offering that can satisfy a need or want. Major typed of basic

offerings:

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Goods, services, experiences, events, persons, places, properties,

organizations,information and ideas. A brand is an offering from a known source.

Value and satisfaction:

Value is what customer gets and what he gives. Customer gets benefits and

assumes costs. Benefits include functional and emotional benefits. Costs include

monetary costs, time costs, energy costs and psychic cost.

Value of customer offering can be increased by:

Raise benefits

Reduce costs

Raise benefits AND reduce costs

Raise benefits by MORE THAN the raise in costs and lower the benefits by

LESS THAN the decrease in costs.

Marketing Channels:

To reach a target market marketer uses three different kinds of marketing channels.

Communication channel: The marketer uses communication channels to

deliver and receive messages from target buyers. These consist of dialogue channels (e

mail, toll free numbers).

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Distribution channels: To display and deliver the physical product or

service to the buyer or user. They include warehouses, transportation vehicles and

various trade channels such as distributors, wholesalers, retailers etc.

Selling channels: They include not only the distributors and retailers but

also the banks and insurance companies that facilitate transactions.

The marketing process consists of analyzing markets, researching and selecting markets,

designing marketing strategies, planning marketing programs and organizing,

implementing and controlling the marketing effort.

Analyzing market opportunities – A company should identify long term

opportunities given its core competences and market experience. This needs reliable

market research and information systems. Both, the Macro environment, consisting

of demographic, socio-cultural, economic, technological, etc forces; and the

Microenvironment, consisting of suppliers, marketing intermediaries, customers and

competitors should be considered.

A way to do it is to divide the market into many segments and evaluate the segments

to find which segment serves the company best.

Developing marketing strategies – After deciding upon the product the company

shall have to decide upon the product positioning, then initiate the product

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development, testing and launching. Also the strategy for the different life stages

of the product: introduction, growth, maturity and decline have to be decided.

Planning marketing programs – It consists of deciding upon the following

1. Marketing expenditure – allotting the budget to meeting the marketing

objectives, and

amongst the products, channels, promotion media and sales areas, and in the

marketing mix.

2. Marketing mix

SEGEMENTING CONSUMER AND BUSINESS

MARKETS

Basis for segmenting consumer markets:

Two broad groups of variables are used to segment consumer markets. Some

researchers try to form segments by looking at consumer characteristics:

demographic, geographic, and psychographic. Then they examine whether these

customer segments exhibit different needs or product responses.

Methods of Segmentation: Geographic segmentation: it calls for dividing the

market into different geographic units such as nations, states, regions, counties,

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and cities. The company can operate in one or few geographic areas or operate in

all but pay attention to local variations.

Demographic segmentation: in this the market is divided into groups on the

basis of variables such as age, family, size, life cycle, gender, income,

occupation, education, religion, race, generation, nationality, social class. These

variables are the most popular basis for distinguishing customer groups. One

reason is that consumer wants, preferences, usage rates are often associated

with demographic variables. Another reason is that demographic variables are

easier to measure even when the target market is defined in non-demographic

terms. The link back to demographic characteristics is needed in order to

estimate the size of the target market and the

media that should be used to reach it efficiently.

Age and life cycle stage:

Consumer wants and abilities change with age. Gerber realized this and began

expanding beyond its baby food lines. Nevertheless age and life cycle can be tricky

variables.

Gender: gender segmentation has been applied to clothing hairstyling cosmetics

and magazines. Other marketers also noticed opportunity for gender segmentation.

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Income: it is a long standing practice in such product and service categories

e.g. Automobile, clothing and cosmetic and travel.

Marketing Mix: The 4 P's of Marketing

Marketing decisions generally fall into the following four controllable categories:

• Product

• Price

• Place (distribution)

• Promotion

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These four P's are the parameters that the marketing manager can control, subject to the

internal and external constraints of the marketing environment. The goal is to make

decisions that center the four P's on the customers in the target market in order to create

perceived value and generate a positive response.

Product Decisions

The term "product" refers to tangible, physical products as well as services. Here

are some examples of the product decisions to be made:

PRODUCT

PRICE PLACE

PROMOTION

Target market

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• Brand name

• Functionality

• Styling

• Quality

• Safety

• Packaging

• Repairs and Support

• Warranty

• Accessories and services

Price Decisions

Some examples of pricing decisions to be made include:

• Pricing strategy (skim, penetration, etc.)

• Suggested retail price

• Volume discounts and wholesale pricing

• Cash and early payment discounts

• Seasonal pricing

• Bundling

• Price flexibility

• Price discrimination

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Distribution (Place) Decisions

Distribution is about getting the products to the customer. Some examples of

distribution decisions include:

• Distribution channels

• Market coverage (inclusive, selective, or exclusive distribution)

• Specific channel members

• Inventory management

• Warehousing

• Distribution centers

• Order processing

• Transportation

• Reverse logistics

Promotion Decisions

In the context of the marketing mix, promotion represents the various aspects of

marketing communication, that is, the communication of information about the product

with the goal of generating a positive customer response. Marketing communication

decisions include:

• Promotional strategy (push, pull, etc.)

• Advertising

• Personal selling & sales force

• Sales promotions

• Public relations & publicity

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• Marketing communications budget

Industry Review

Snacks Segment: An Overview

A snack food (commonly shortened to snack) is seen in Western culture as a type of

food not meant to be eaten as a main meal of the day (breakfast, lunch, dinner) but one

that is intended rather to assuage a person's hunger between these meals, providing a

brief supply of energy for the body, or as a food item consumed between meals

purely for the enjoyment of its taste.

Traditionally snacks were prepared simply from ingredients commonly available in

the home, often leftovers, sandwiches made from cold cuts, nuts, fruit, and the like.

With the multiplication of convenience stores, packaged snack foods are now a

significant business. Snack foods are typically designed to be portable, quick and

satisfying. Processed snack foods are designed to be less perishable, more durable,

and/or more appealing than prepared foods. They often contain substantial amounts

of sweeteners, preservatives, and appealing ingredients such as chocolate, peanuts,

and specially designed flavors (such as flavored potato chips).

Snack foods are often subjectively classified as junk food: they have little or no

nutritional value, and are not seen as contributing towards general health and nutrition.

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The snack food industry in market-driven societies such as the India

generates billions of dollars in revenue each year. The market for processed snack foods

is enormous, and a number of large corporations compete rigorously to capture

larger shares of the snack food market. Consequently, heavy promotions are used to

convince consumers to buy snack foods. Processed snack foods are advertised far

more than regular nutritional foods (such as fruit, vegetables, meat, dairy

products), and the flashiest TV commercials and advertising campaigns are often

designed to sell these products. Yet, the traditional companies do recognize the need

for healthier alternatives. Realizing the potential market discovered by companies such

as ITC, companies like Frito Lays, PepsiCo, and Coca Cola are now pressured into

creating new alternatives for consumers.

AIM OF THE STUDY

“To identify what makes a new product is successful”

Six months into the launch, ITC had really broken into the stronghold of Lays.

Although it is too early to praise Bingo or ITC on their success, the brand now has a

market share of 16 % is something commendable. Bingo now aims for 25 %

of the Rs 2000 crore branded snack market. The share of Lays had reduced from

65% to 45% . The brand had made a base for itself. There are various factors that

aided the success of Bingo.

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High Decibel Advertising: Bingo was able to capture the ‘Share of Noise’ through

its heavy spend. Helping that was the latest move of Lays to change the famous tagline

to “Har Program ka Main Food".

Novelty Factor: The snack market is driven by impulse purchases and Bingo had the

advantage of the ITC parentage that encouraged consumers to try out the product without

much inhibition.

Regional Flavors : This is where Bingo can beat Lays in their own game. Lays was the

first to localize flavors but Bingo specialized on local flavors and the key

differentiator was the Localized flavors.

Distribution Strength : One of the most important factr which can be the critical success

factor of Bingo is the distribution strength as the Numero Uno. The easy availability

had facilitated the growth of the product. In any supermarket or Kirana store, Bingo is

highly visible. In India there is no company that can match the distribution strength

of ITC and this has helped this new launch very much interims of Shelf Space and

retailer support. Whenever a new brand comes, the larger brands lose market share. Like

wise the high profile launch of Bingo has eroded the market share of Lays but things can

change very fast.

SCOPE AND COVERAGE

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ITC has seen great potential in the snacks market and is trying to position its new

brand here. The study was focused to find out the reasons the consumers preferences are

shifting from the Frito lays to “BINGO”. We would also try to understand the purchase

pattern of the product as in what variables affect the purchase behavior of customers and

makes them shift from other snack brands to this product.

The study had only been concerned with the snacks, covering only ITC and

Frito lays products. The time period of study would be recent i.e., 2007. It is worth

noting that the ITC’s brand Bingo was introduced in the market in March 2007.The

coverage of the study was in Bareilly

HYPOTHESIS

1. Does the customers’ preference in the snack foods category is changing from

Frito lays products to “Bingo”?

2. The customers’ preference in the snack food industry is not changing from Frito Lays

products to “Bingo”.

RESEARCH DESIGN

The research design was exploratory in nature. The surveys were performed in a

single cross-sectional design.

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SAMPLING DESIGN

The sampling technique had been Probability sampling. The sample had been

a Simple Random Sample, where every element had an equal chance of being

selected. The sample element was non- restricted. The data was collected from

Bareilly. The population had been representing a variety of

elements. The sample size is 100 respondents.

QUESTIONNAIRE DESIGN

The questionnaire is designed to have only close ended questions.

Annexure-1: QUESTIONNAIRE

DATA COLLECTION METHODS

Data on the basis of which we had analyzed our stated problem that is “Shifting

preferences of consumers from Frito lays products to bingo products in snacks”. Two

types of method were there for data collection, they were Primary sources and

secondary sources. With in primary sources we had done a market survey with the

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help of our questionnaires, questionnaires had been filled from different reasons of

India. Secondary data helped us in making comparative study of Bingo and Lays by

different measures taken by us.

I had tried to cover wide geographical area of Bareilly. Within those parts main areas

like civil lines, cantt (B.I bazaar, Sadar bazaar), Butler , Rajendra Nagar .

Within these areas I collected the data from shops, shopping centers, door to door

approach to residential colonies, bank’s employees, and colleges. For the secondary data

I collected information from newspapers, magazines, and various websites.

DATA ANALYSIS AND INTERPRETATIONS

As per the consumer segmentation done by bingo we have also divided our age

interval in that fashion. According to a research analyst of bingo who designs wrapper

“The main target customers of bingo are between age groups 12-18 and 18-25”, they

have design their wrappers of bingo products keeping in mind this age groups only,

where as lays target consumer are from all age group, that’s why I included two age

group also which is less than 12 and greater than 25. Due to above two reasons I

have selected age groups less than 12, 12-18, 18-25 and above 25, in both gender.

That differentiation between age groups has helped us a lot to make a comparative study

of Frito-Lay’s product and ITC bingo.

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Measures

The most important measures on the basis of which we came to conclude our hypothesis

are:-

1. Measure 1: Consumer preference.

2. Measure 2: Promotion.

3. Measure 3: Taste, Quality, Availability, Variety and Satisfaction.

CONSUMER PREFERENCE

In order to know the validity of secondary data which says that after declining of market

share of lays i.e. from 65% to 45%, lays is still the market leader. I asked

respondents about their preferences between Frito lays product and ITC bingo product.

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Inference

This graph directs us to the present buying pattern of snacks. Among males,

especially among those of age group 18-25 yrs there is a clear majority for lays.

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This shows the clear majority that lays runs in this age group. The different factor of

promotion has not deterred them from buying lays, and a clear brand loyalty is seen.

In the female segment, lays has a clear majority in almost all age groups.

Similar to the male segment, in the age group of 18-25 there is huge majority. This

depicts the strong brand presence of the product lays. Lays can work a little on

the age groups of 12-18 to make its presence feel.

PROMOTION

It is the major activity performed by any organization in order to make people

aware about products. Promotion scheme done by ITC for launching of Bingo is

innovative. On the other hand Firto lays products campaign is very gentle.

Does the promotional scheme of bingo is affecting consumer behavior and

letting them to shift their preference from Firto lays product to ITC bingo? Which earlier

done market research is saying? Promotional scheme is one of the most supportive

elements for our hypothesis which says “Does consumers’ preference is shifting from

Firto lays products to Bingo” and why it is so?

In order to make comparative study about promotion of bingo and lays we

differentiated promotional scheme of both brand on the parameters of excellent, good,

average and poor.

39

Inference

40

Talking about promotional scheme of bingo only 9% of respondent of both thegender had said

that “it is not effective”. Most of the people in the age group of 18-24 liked the

promotional scheme of bingo.38% percent of total respondent liked the promotion of bingo.

TASTE

If we are talking about two eatables i.e. lays and bingo than taste should be effective

criterion in order to judge the consumers preferences. We have asked respondents to

rate the taste of bingo and lays on the scale of 1-5 where “5” is “excellent” and “1” is

“worst”.

41

Inference

Talking about bingo, 75% of the respondent has ranked the taste of bingo in

the category of 3-5, which shows that most of them liked the taste of bingo,

mainly in the age group of 18-25. As far as lays is concerned, 76% of

the respondent have liked the taste, which is normally distributed in all

age group.

QUALITY

42

Another important criterion to judge about eatables is their quality. It is

important factor to know about the consumer preference of lays and bingo.

We have asked respondents to rate the quality of bingo and lays on the scale

of 1-5 where “5” is “excellent” and “1” is “worst”.

43

Inference

Talking about bingo, app. 60% of the respondent have ranked the quality

of bingo in the category of 3-5, which shows that most of the

respondent like the quality of bingo, which is normally distributed. as

far as lays is concerned, 78% of the respondent have liked the quality,

which is not normally distributed in all age group.

So there is a much concern to improve the quality of bingo, which seems

to be not compatible with lays.

AVAILABILITY

44

According to Philip Kotler (‘Marketing Management’ 13 edition)

“Place is another important criterion to attract new customers and satisfy

needs of existing customers”, but in the modern sense of marketing

“Place” has been converted into “Availability”. If the market is

“perfectly competitive” and if availability of product is not there than

customer have other options to choose. For example, in absence of lays

customer will purchase bingo irrespective of

its willingness to have lays.

I asked respondent to rate availability of both product on the scale of

1-5.

45

Inference

Talking about bingo, app. 70% of the respondent have ranked the

availability of bingo in the category of 3-5, which shows that most of

the respondent are happy with availability of bingo, which is normally

distributed. As far as lays is concerned, 78% of the respondent have

liked the availability, which is not normally distributed in all age

group. So there is a much concern to improve the distribution pattern of

bingo, so that everyone can access to it.

46

VARIETY

A product can’t survive in the market without having variety in it.

For example: If product A is not having good assortment in it and on

other hand its major competitor is having that facility than definitely he

will be the market leader of that segment.

Similar is the case with eatables because different persons may have

different preferences of their taste so variety of taste is needed in it. In order

to know the satisfaction from the variety of products given by lays and

bingo I asked respondents to rate it on a scale of 1-5.

47

Inference

Talking about bingo, app. 72% of the respondent have ranked the variety of

bingo in the category of 3-5, which shows that most of the respondent

are happy with variety of bingo, which is normally distributed among

all age group . as far as lays is concerned, 78% of the respondent

have liked the variety, which is not normally distributed in all age group.

Here it is clear that bingo in case of variety giving tough competition to

lays people are liking regional flavors of bingo.

48

SATISFACTION

Satisfaction driven after the consumption of any product is major

criterion to judge the shifting nature of customers from one product to

another one. Satisfaction is the criterion which tells us willingness of

customers to purchase the product repeatedly, it tells us about the marginal

utility of any product, if marginal utility of any product is same on

repeated purchase than it shows that market value of that product is good

and will keep on increasing.

To know the satisfaction level of customer we asked respondents to

rate it on a scale of 1-5 for both bingo and lays.

49

Inference

Talking about bingo, app. 65% of the respondent have ranked the

satisfaction derived

after consuming bingo in the category of 3-5, which shows that most

of the respondent are happy with brand bingo. Preferences of

respondents are normally distributed among all age group. As far as

lays is concerned, 75% of the respondent are satisfied with brand

bingo, respondents preferences are not normally distributed in all age group.

Here it is clear that bingo in case of satisfaction is giving tough

competition to lays people are satisfied what they perceived about bingo.

50

DATA ANALYSIS

In order to know dependency of age group on different measures we

have used chi- square at a confidence level of 95 %( which defines likely

range of true value in the population from which we drew our sample). All

the calculated Chi- Square values of measures -1, 2 and 3 are coming to be

less then tabular Chi value, on the basis of which we can say that all the

stated measures are totally independent of the age groups.

Data shown in Table [9]

Interpreting data from measure [1] it is clear that lays is still market

leader in snacks market which secondary data is also saying, but some

portion of consumer preferences has shifted from Frito lays to bingo. Now

by the help of measure-2 and 3 we can conclude by which measures the shift

is there, to know that cause we have applied weighted average mean as

statistical tool where

X1 = Weighted average mean of bingo

X2 =Weighted average mean of lays

51

Data shown in table [10]

In each and every case X2 > X1, which shows consumer association is still

very much with lays but (X2 –X1) is not same for all the measures . If we

take (X2 –X1) value of quality fig [ ] as our benchmark (because it is

having highest X2 -X1 value) and compare it with other measures we can

say that association of consumer with lays is decreasing or is very low. On

the basis of X2 –X1 value of promotion which is 0.17 (lowest among all) we

can say that promotion scheme of bingo is the major cause for lays in

loosing market share.

After promotion scheme, varieties with in bingo (16 regional flavors)

are giving tough competition to lays, the different regional flavors of bingo

are giving consumers a great amount of satisfaction which is shown by X2 –

X1 value of satisfaction.

But talking about availability of bingo we can say that consumer is not

happy with distribution channel of bingo.

The worst situation for bingo is its quality; that field seems to be a

waterloo for them, they can win that battle only by help of proper planning,

52

X2 –X1 value of quality is highest among all. In the lieu of all the above

inferences we can say that

53

TABLE-1

Characteristics of the subjects

54

FEMALE MALE

SAMPLE SIZE 29 71

AGE GROUP Less than 12, 12-18, 18-

25

25 above.

Less than 12, 12-18, 18-

25,

25 above.

TABLE 2

GENDER AGE

INTERVAL

BINGO LAYS

MALE <12 1 0 1

MALE 12--18 5 6 11

MALE 18--25 4 41 45

MALE >25 1 13 14

55

71

GENDER AGE

INTERVAL

BINGO LAYS

FEMALE <12 0 0 0

FEMALE 12--18 5 9 14

FEMALE 18--25 0 10 10

FEMALE >25 0 5 5

29

TABLE 3

56

How do you like the promotional Scheme of ITC-Bingo and Fitolays

BINGO

Age

Interval

Excellent Good Average Not Effective Total

<12 0 0 0 1 1

12-18 14 5 5 3 27

18-25 12 24 15 2 53

>25 2 9 5 3 19

Total 28 38 25 9 100

LAYS

57

Age

Interval

Excellent Good Average Not Effective Total

<12 3 7 4 0 14

12-18 18 8 5 0 21

18-25 13 26 12 0 15

>25 2 9 3 0 14

Total 26 50 24 0 100

58

TABLE 4

Rate the "taste" of Bingo and Lays on the scale of 1-5.

BINGO

LAYS

Age

Interval

1 2 3 4 5 Total

<12 0 0 0 1 0 1

12-18 2 4 5 6 7 24

18-25 1 11 16 14 1 43

>25 1 2 8 3 1 15

Total 4 17 29 24 9 83

59

Age

Interval

1 2 3 4 5 Total

<12 0 0 1 0 0 1

12-18 1 4 4 9 6 24

18-25 5 8 4 14 12 43

>25 1 1 2 9 2 15

Total 7 13 11 32 20 83

60

TABLE 4

Rate the "Quality" of Bingo and Lays on the scale of 1-5.

BINGO

Age

Interval

1 2 3 4 5 Total

<12 0 0 0 1 0 1

12-18 4 6 5 6 3 24

18-25 5 13 8 10 7 43

>25 1 5 5 3 1 15

61

Total 10 24 18 20 11 83

LAYS

Age

Interval

1 2 3 4 5 Total

<12 0 0 1 0 0 1

12-18 2 3 5 4 10 24

18-25 3 8 4 10 18 43

>25 1 1 4 6 3 15

Total 6 12 14 20 21 83

62

TABLE 6

Rate the "Availability" of Bingo and Lays on the scale of 1-5.

BINGO

Age

Interval

1 2 3 4 5 Total

<12 0 0 0 1 0 1

63

12-18 2 4 5 7 7 25

18-25 3 16 17 13 6 55

>25 0 5 5 3 6 19

Total 5 25 27 24 19 100

LAYS

Age

Interval

1 2 3 4 5 Total

<12 0 0 0 1 0 1

12-18 2 3 4 5 11 25

18-25 7 9 2 11 26 55

64

>25 0 1 4 7 7 19

Total 9 13 10 14 44 100

TABLE 7

Rate the "Variety" of Bingo and Lays on the scale of 1-5.

BINGO

65

Age

Interval

1 2 3 4 5 Total

<12 0 0 0 1 0 1

12-18 1 4 4 8 8 25

18-25 9 9 9 15 13 55

>25 0 5 5 5 4 19

Total 10 18 18 29 25 100

LAYS

66

Age

Interval

1 2 3 4 5 Total

<12 0 0 1 0 0 1

12-18 1 3 2 6 13 25

18-25 4 12 7 17 15 55

>25 1 1 7 8 2 19

Total 6 16 17 31 30 100

67

TABLE 8

Rate the “Satisfaction "of Bingo and Lays on the scale of 1-5.

BINGO

Age

Interval

1 2 3 4 5 Total

<12 0 0 0 1 0 1

12-18 3 6 3 6 9 27

18-25 5 9 11 10 6 41

>25 1 5 5 2 1 14

Total 9 20 19 19 16 83

68

LAYS

Age

Interval

1 2 3 4 5 Total

<12 0 0 0 1 0 1

12-18 1 5 6 6 6 24

18-25 6 6 8 10 13 43

>25 0 2 3 6 4 15

Total 7 13 17 23 23 83

69

TABLE 9

MEASURES CALCULAT

ED

CHI-

SQUARE

TABULA

T

ED CHI-

SQUARE

COMPARI

SON

Bingo Lays Bingo lays bingo Lays

PROMOTIO

N

0.0024640 0.7598

46

5.226 5.226 Calculated

value is less

then tabular

value

Calculated

value is less

then tabular

value

TASTE .0887 .401 5.226 5.226 Calculated

value is less

then tabular

value

Calculated

value is less

then tabular

value

70

QUALITY .903 .4125 5.226 5.226 Calculated

value is less

then tabular

value

Calculated

value is less

then tabular

value

AVAILABIL

TY

.46 .254 5.226 5.226 Calculated

value is less

then tabular

value

Calculated

value is less

then tabular

value

VARIETY .612 .039 5.226 5.226 Calculated

value is less

then tabular

value

Calculated

value is less

then tabular

value

ATISFACTI

ON

.43 .77 5.226 5.226 Calculated

value is less

then tabular

value

Calculated

value is less

then tabular

value

71

TABLE 10

MEASURES X( bingo) X( Lays) DIFFERENCE(X -

X)

PROMOTION 2.85 3.02 .17

TASTE 3.2 3.542 .3421

QUALITY 2.975 3.698 .723

72

AVAILABILTY 3.25 3.81 .56

VARIETY 3.41 3.63 .22

ATISFACTION 3.156 3.50 .344

73

CONCLUSION

In light of all discussed inferences we can say that if a new product

is launched in a perfectly competitive market with proper analysis of

market, than it can easily penetrate in the market. Nothing is impossible

for any one, the only thing required to make things possible is right

approach. For the success of any product the most important thing required

is its awareness among customers, if people are not aware about the product

than, how can they purchase it?

74

Promotion scheme is one of the criterions behind making people aware

about a product,

if promotional scheme which cover all type of add campaign is able to

define itself to the target customers than it become easy for the product

to penetrate with in the market share of other product, as bingo is doing.

Once the product is able to penetrate with in the market than the over all

performance of product becomes very important in order to grab as much

market share as it is possible. If we look overall performance of bingo

taking into consideration all the measures (page) than we can say that

bingo is able to snatch some market share from Frito LAYS, if BINGO

keep on climbing the ladder of success with the same pace than days

are not far away for bingo to become market leader in ready to eat

snacks market. Another thing which is clear from my findings is that all

measures stated by me are totally independent of age group chosen by us

and the different add campaign helped them a lot to meet with their

objectives so i can say that

print media plays a vital role in popularity of any new introduced product.

75

RECOMMENDATION

No one in this world is perfect every one has some draw back with in it

and bingo is not exception in it, if ITC want to capture hole of the ready to

eat snacks market than there are some grey areas where they have to work

hard, supply chain and quality of product are among them. Availability of

bingo is not as good as that of lays, so they have to work hard on the supply

chain of product, it is obvious that if Frito lays is there in market from very

beginning than they will be enjoying the benefits of supply chain, Frito

lays product are having good supply chain due to which their product

is available to customers at their convenient place. Quality of product

is another grey area where ITC has to work hard if they want to capture the

crown of market leader.

76

BIBLIOGRAPHY

1. Book: Marketing Management 13th edition, by Philip Kotler.

2. “CONSUMER BEHAVIOR: THE PSYCHOLOGY OF MARKETING”,

by Lars

Perner, PhD .

3. Magzines “4 Ps, and others

4. http:// www.citemarketing.com

5. http://www.consumerpsychologist.com/strategy

6. http://learnmarketing.net/product.htm

77

QUESTIONNAIRE

78

Name: ___________________________________________

Gender: 1. Male

2. Female

Age: _____

Address:

_________________________________________________________

1. How often do you buy ready-to-eat snacks?

Daily

Once a week

Once in 3 days

Rarely

2. Which Brand of snacks do you buy out of the following?

Regional Flavors in BINGO

Flavors in LAYS

79

3. Which products do you like the most? 1- for the best 4 for worst. Rank on a

scale of 1-4

Bingo

Kurkure

Lays

Uncle Chips

4. Have you tried BINGO?

Yes

No

5. How did you come to know about BINGO?

Promotional Ad from TV

Internet

Radio

Newspapers

Hoardings

Heard from a friend

80

6. What attracted you to buy BINGO?

New introduced Product

Easy Availability

Innovative Promotion

Brand of ITC

7. If not tried BINGO then why?

Non Availability

Not Aware

New introduced Product

Your Preference for other Brand

8. Which of the following flavors of BINGO have you tasted?

Mad angles

81

Tedhe medhe

Live wires

Chips – masala flavored

Nimbu achaar

Chips –tomato flavored

Paneer tikka

8. Which of the following flavors of BINGO you liked the most?

Mad angles

Tedhe medhe

Live wires

Chips – masala flavored

Nimbu achaar

Chips –tomato flavored

Paneer tikka

9. How you liked the promotional scheme of ITC-BINGO and

FRITOLAY- LAYS?

82

Product Excellent Good Average Not Effective

ITC BINGO

FRITOLAYS

10.Rate the “taste” of BINGO and LAYS on a scale of 1-5.

1 2 3 4 5

BINGO

LAYS

11. Rate the “Quality” of BINGO and LAYS on a scale of 1-5.

1 2 3 4 5

83

BINGO

LAYS

12. Rate the “Availability” of BINGO and LAYS on a scale of 1-5.

1 2 3 4 5

BINGO

LAYS

13. Rate the “Variety” of BINGO and LAYS on a scale of 1-5.

1 2 3 4 5

BINGO

LAYS

14. Rate the “Satisfaction” you derive from BINGO and LAYS on a scale of

1-5.

1 2 3 4 5

84

BINGO

LAYS

85

86