Factors Influencing Consumer Buying Beha

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International Monthly Refereed Journal of Research In Management & Technology

ISSN – 2320-0073 Volume III, January’14
FACTORS INFLUENCING CONSUMER BUYING

BEHAVIOR WITH SPECIAL REFERENCE TO DAIRY
PRODUCTS IN PONDICHERRY STATE
A. Ananda Kumar1 and Dr. S. Babu2
1
Assistant Professor (Senior Grade), School of Management, Christ College of Engineering
& Technology, Puducherry, India
Email: [email protected]
2
Assistant Professor, Department of Business Administration, M.R. Government Arts
College, Mannargudi, Tamilnadu, India
Email: [email protected]
ABSTRACT
Consumer behavior analysis is based on consumer’s buying behavior. It aims at improving
business performance through an understanding of the customer’s preferences and desires.
In today’s world of growing competition where there are numerous brands selling the same
products, consumers have an abundant number of choices and many diverse factors
influence their buying behavior. This study is based on Descriptive study and the statistical
tools used are Percentage & Weighted Average Method. This study made an attempt to find
the factors affecting consumer’s buying behavior, with the focus on dairy products in
Pondicherry state. These factors are based on certain variables used in the survey. The
variables include packaging, cost, availability, ingredients, product popularity, product
quality, product taste, etc., that influence the choice of a brand from among those in the
consideration list, but may not be the most important and primary determinants for short
listing brands. The study is useful to the marketers as they can create various marketing
programs that they believe will be of interest to the consumers. It can also boost their
marketing strategy.
Keywords: Dairy Products; Consumers; Consumer Buying Behavior
INTRODUCTION
Consumer is a person who buys or uses things (goods) or services. Marketers are the persons
who provide these services. The most challenging questions for marketers are why buyers do
what they do (or don’t do). Such knowledge is critical for marketers, since having a strong
understanding of buyer’s behavior will shed light on what is important for the consumer and
also suggest the important influences on consumer decision-making. Factors affecting
consumers’ buying decisions are extremely complex. It is deeply rooted in psychology with
dashes of sociology thrown in just to make things more interesting. It explains the influences
on the consumer from groups such as family, friends and society in general. Consumers’
buying behavior result from deeply held values and attitudes, their perception of the world,
their place in it, from common sense, from impulse or just plain take.
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Consumers behaviour, preferences and attitudes towards consumption of dairy products

differs substantially across countries (Bus & Worsley, 2003; Francesconi, Heerink &
DHaese, 2010; Grunert, TionBeck-Larsen & Bredahl, 2000; Hatirli, Ozkan, & Aktas, 2004;
Hsu & Lin, 2006; Richardson-Harman, 2000; Robb & Abdel-Ghany, 2007; Yee & Chin,
2007). Grunert et al. (2000) discuss that consumers perceptions of dairy product quality are
complex and involve much more than sensory attributes. They contend that consumers
consider four dimensions when forming perceptions about dairy product quality: (1) hedonic
(e.g. sensory attributes such as taste or smell), (2) health-related, (3) convenience-related and
(4) process-related (e.g. production processes such as organic, animal welfare or genetic
modification). Thus, manufacturers/ processors and marketers must understand the role each
of these dimensions plays in driving consumer demand for dairy products and realize
consumers may be heterogeneous in their preferences or perceptions of what constitutes
dairy product quality.
In the fast growing world of consumerism, it is necessary for every organization to study
their customer preference for dairy products to identify the underlying factors for preference
of dairy brands as well as make suggestions for the company to take the right market to be a
leader in the market to the dairy products.
Table 1. Black Box Model
The black box model shows the interaction of stimuli, consumer characteristics, 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.
OBJECTIVES OF THE STUDY
 To study the Brand Preference on dairy products in the study area.
 To understand Customer Satisfaction level on dairy products in Pondicherry state.
 To analyse the factors influencing on dairy products.
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REVIEW OF LITERATURE
The consumer decision-making process is important in determining purchase behavior. In
order to offer an effective service, it is important to identify consumer segments, taking into
account the benefits which the consumer seeks. Consumers seek benefits or solutions, not
products (Rowley, 1997). When they buy a product, whether it is a good or a service, they
buy a cluster of product features, but may want only one or two of these features. The main
reason behind consumer’s search is uncertainty. Consumer information search has been the
focus of many articles studying consumer behavior during the last 30 years (Bettman, 1979).
Various studies have provided information about the measures of compulsivity, which helps
in analyzing compulsive buying tendencies of consumers. Faber and O’Guinn T C (1992)
reported a seven-items scale and assessed its reliability and validity. An earlier version 58
The IUP Journal of Marketing Management, Vol. IX, Nos. 1 & 2, 2010 of this scale used a
subset of three items (Faber and O’Guinn, 1989b) while, Faber and O’Guinn (1989a) used a
superset of 15 items to operational compulsivity.
The second approach (Youn and Faber, 2000) mainly used a nine-item scale, earlier
developed by Rook and Fisher (1995). Thus compulsive buying is a very important aspect in
consumer’s behavior research. It has been defined as “chronic, repetitive purchasing, that
becomes a primary response to negative events or feeling” (Faber and O’Guinn, 1992).
Previous studies in this area have highlighted the fact that compulsive buyers tend to have a
lower self-esteem, a higher level of tendency to fantasize, and a higher level of depression
anxiety, and obsession, as compared to other consumers (Faber and O’Guinn, 1989b). Furst
et al. (1996) reported human food choice as one of the basic and common components
among consumers but is also one of the most complex function having multitude of
influences. Consumers appear to have much more pragmatic considerations in mind when
making their food choice decisions. These considerations include sensory aspects of food
(e.g., taste and quality) (Powell et al., 2003) along with the influence of non-food effects
(e.g., cognitive information, the physical environment, social factors) (Rozin and Tuorila,
1993; and Bell and Meiselman, 1995). Quality and safety are thus two very important
elements in consumer’s food perception and decision-making associated with food choice
(Grunert, 2005). Consumers’ purchasing decisions are normally based on their own
perception and representations of quality and safety.
However, quality and safety are the concepts that cannot be easily defined, because they are
classified as credence attributes (i.e., product attributes that cannot be verified by the
consumer). Consumers are most likely to derive quality or safety perceptions from other
product cues, either intrinsic (e.g., appearance of the product) or extrinsic cues (e.g., a
quality label) (Nelson, 1970). Hence, it is quite difficult to analyze and discuss all the
potential determinants of food choice, because food choice is a very complex issue in which
many factors play a role, including biological, psychological and cultural (Frewer and van
Trijp, 2007; and Rozin, 2007).
In fact, perceptions of food quality and safety are likely to be influenced by such
psychological and cultural factors rather than physiological product experiences alone. Many
quantitative and qualitative researches have addressed issues associated with cultural
determinants of food choice (Shepherd and Raats, 2007). It is quite evident from such studies
that while analyzing factors that influence food choice, it is important to consider
consumer’s cultural background (Overby et al., 2004; and Hoogland et al., 2005).

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It is believed that people from different cultural backgrounds have different perceptions and
experiences related to food (Lennernas et al., 1997). Hence it can be noticed that some
consumers are more oriented towards food quality, whereas for others food safety is a
primary concern. Consumer behavior is also affected by the socioeconomic conditions of the
markets namely, income, mobility, media access (Tse et al., 1989). It has been observed that
per capita income and disposable income indicates the amount of resources consumers
allocate to consumer goods (Johansson and Identification of Secondary Factors that
Influence Consumer’s Buying Behavior 59for Soaps and Chocolates Moinpour, 1977).
As more resources become available, consumers may desire more emotional image attributes
in products or brand (Kim et al., 2002). Personal values have been found to be the
underlying determinants of various aspects of consumer attitude and behavior (Homer and
Kahle, 1988). Thus, values are one of the most important influential factors that affect the
type of needs consumer tries to satisfy through purchase and consumption behaviors (Tse et
al., 1989). Brand of a particular product plays a fundamental function in consumer’s
perception of a product.
It helps in developing a market position, prestige and image of the product and for these
reasons the brand constitutes a mechanism of risk reduction (Aaker, 1996). Hence, selection
of brand is another major constituent of consumer behavior. In the complex brand selection
environment, which exists today, there has been a widely reported research work which
discusses and reports that consumers defer product/ brand selection on a variety of factors
(Tversky and Shafir, 1992; and Dhar, 1997). In situations when consumers are unable to
defer the product choice decision, consumers may experience overload and anxiety at worst
or develop simplifying decision heuristics to help them make product choices (Swait and
Adamowicz, 2001) at best.
Observing the purchase behavior of unknown or known consumers (Park and Lessig, 1977)
is one such readily apparent heuristic. This helps in simplifying consumer’s decision-making
process by providing information that provides a source for consumer’s “evaluations,
aspirations, and behavior” (Park and Lessig, 1977). They have explained that consumers are
influenced by “others” mainly because of three reasons— informational, utilitarian and value
expressiveness. The source of information is accepted by the consumer if it enhances his/her
knowledge of the environment or ability to cope up with some aspects of this environment
e.g., purchasing of product (Park and Lessig, 1977). This tendency, of consumers to observe
the purchase behavior of other consumers and to incorporate these observations while
making their own purchase decisions, is called as the consumer’s propensity to observe. It
consists of the direct observation of other consumers, the indirect observation of other
consumers or both.
Direct observation occurs by watching the actual purchase behavior of other consumers
(Price et al., 1989; and McGrath and Otnes, 1995) and indirect observation involves the
analysis of trace evidence of shopping behavior. An organization which embraces the
marketing concept tries to provide products that satisfy consumer needs through co-ordinated
sets of activities that also allow the organization to achieve its goals.
Table 2. Most Recalled Dairy Brands in Town of Pondicherry
Brands No. of Respondents Percentage of Respondents
Ponlait 75 75
Hatsun 08 08
Ruchi 06 06
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Table 2. Most Recalled Dairy Brands in Town of Pondicherry (Contd….)

Brands No. of Respondents Percentage of Respondents
Cavins 02 02
Amul 02 02
Others 07 07
Total 100 100
Based on the survey of 100 consumers of dairy products in the Pondicherry state, 75% of the
respondents were preferred the Ponlait followed by Hatsun, Ruchi, Cavins etc.
Table 3. Analysis of Ranking of Attributes by Respondents
Rank (Number of Respondents) Total
Attributes Rank
1 2 3 4 5 6 Score
Product Quality 72 21 4 2 1 1 562 1
Product 21 35 10 16 13 5 420 2
Availability
Product Pricing 19 14 25 9 26 7 370 3
Product Variety 11 20 23 17 17 12 345 4
Brand Image 7 9 11 32 30 11 298 5
Advertisement 4 5 8 11 17 55 208 6
Analysis of Ranking Given By Respondents Regarding Various Attributes
Which Influenced You to Buy the Dairy Products (Brand Preference)
(Using Weighted Average Method)
Table 4
Availability
Advertising
Product
Product
Product
Product
Variety
Quality
Weight
Pricing
Brand
Image
Rank
X W X1 WX1 X2 WX2 X3 WX3 X4 WX4 X5 WX5 X6 WX6

1 6 72 432 21 126 19 114 11 66 7 42 4 24
2 5 20 105 35 175 14 70 20 100 9 45 5 25
3 4 4 16 10 40 25 100 23 92 11 44 8 32
4 3 2 6 16 48 9 27 17 51 32 96 11 33
5 2 1 2 13 26 26 52 17 34 30 60 17 34
6 1 1 1 5 5 7 7 12 12 11 11 55 55
Total 100 562 100 420 100 370 100 345 100 298 100 208
Cw 5.62 4.2 3.7 3.45 2.98 2.08
Rank 1 2 3 4 5 6
Source: Primary Data
Product Mix and Marketing Mix factors are some of the factors which influence Consumers
choose a Brand. The above Table 3 shows Ranking of the major reasons for choosing Dairy
Brands and it is observed that Rank 1 is assigned to Product Quality Rank 2 is assigned to

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Product Availability Rank 3 is assigned to Product Pricing Rank 4 is assigned to Product

Variety Rank 5 is assigned to Brand Image Rank 6 is assigned to the Advertisement. Thus
we see that Quality, Availability and Pricing are among the top 3 reasons while advertising is
only ranked 6.
Consumers while purchase dairy products look for freshness, quality, taste and texture,
variety and convenience. Products like Dahi and sweets like Kheer, Basundi, Rabri are
perishable products with a shelf life of less than a day. These products are, therefore,
manufactured and sold by local milk and sweet shops. There are several such small shops
within the vicinity of residential areas. Consumer loyalty is built by consistent quality, taste
and freshness. There are several milk-based sweetmeat shops, which have built a strong
brand franchise and have several branches located in various parts of a city.
SUGGESTIONS AND RECOMMENDATIONS OF THE STUDY
From the study it reveals that,
 Many customers are using the Ponlait since it gives more usage with less cost
 Even though Amul is very branded, the cost is very high
 The customers prefer branded products based only on quality, availability, price,
variety, image then advertising
CONCLUSION
On the study of the “Factors influencing Consumer buying behavior with special reference to
Dairy Products in Pondicherry State” it was overall observed that Ponlait is the market leader
of dairy products in the town of Puducherry. Ponlait is not only the most highly recalled
brand but also a top rated among the other competitive brands like Hatsun, Ruchi, Cavins
Milk, Amul, etc. We observe that Product Quality, Availability and Pricing have been
regarded as major reasons (top 3 reasons) for preference of dairy brands.
In the scenario of the various dairy brands available in the market we can conclude that in
the town of Puducherry Ponlait is ranked 1 in Price, Taste, Quality, Availability and
Packaging. The next closest Competition is from Hatsun, Ruchi and other private brands.
However the data shows that Competition for Ponlait dairy products is very insignificant
while the competition in the other dairy segment like Ice-Cream, Ponlait is being pushed
down to Position 2 while Arun Ice Cream is the market leader in this product segment.
Further frequency and place choice for the purchase of dairy products will help the company
(Ponlait) to identify the right channels of distribution for its various dairy products. For
example: in the case of ice-cream Consumers Preference of place is Ice Parlors providing the
right ambience to enjoy their Ice-Creams. Further a Considerable amount of Brand
Switching behaviour is observed among the respondents in case of non-availability of their
favourite brands in their stores and also a Retailer role in influencing brand choice is
Considerable at this level.
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International Monthly Refereed Journal of Research In Management & Technology

FACTORS INFLUENCING CONSUMER BUYING

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Consumers behaviour, preferences and attitudes towards consumption of dairy products

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Table 2. Most Recalled Dairy Brands in Town of Pondicherry (Contd….)

X W X1 WX1 X2 WX2 X3 WX3 X4 WX4 X5 WX5 X6 WX6

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Product Availability Rank 3 is assigned to Product Pricing Rank 4 is assigned to Product

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