Chapter-2 Consumer Behaviour

The Management of PROCTER & GAMBLE once stated : ” business is based on understanding the consumer and providing the kind of products that the consumer wants. We place enormous emphasis on our product development area and our marketing area, and on our people knowing the consumer.” The human mind is the most complex entity in the whole universe as it is very unpredictable how a person would behave in or react in a particular situation.

A person’s behavior changes from place to place and situation to situation or, say it is very inconsistent. The person when has a need, is willing and able to satisfy the need is called a CONSUMER. Theconsumer would go different ways to satisfy it’s needsdepending on his social, cultural, family, economic and educational background. Consumer is the principle a priori  of business. The efficiency with which a free market system of enterprise operates, depends upon the extent of consumer understanding possessed by the business community. A business community that is ignorant of consumer preferences  cannot possibly fulfill it’s obligations in a meaningful and responsive manner.

Consumer Behavior is broadly defined as “the behaviorthe consumer displays in searching for, purchasing,using and evaluating products, services, and ideaswhich they expect will satisfy their needs.” ConsumerBehavior is not only the study of what people consume,but is also the study of who the consumers are, whythey consume, how often they consume, and under whatconditions they consume.CONSUMER BEHAVIOUR refers to the buying behavior ofultimate consumers, those persons who purchaseproducts for personal or household use, not for businesspurpose.There are Psychological Theories that help us  tounderstand and predict the effect of all external andinternal factors on a consumer. External factorsinclude Culture, Society, Reference group and familyetc. Internal factors comprise in a consumer mind andhow consumers learning, memory, attitude, personality,lifestyle and motivation  levels effect consumerbehavior. What would initiate a buying process and howa buying decision would end is all covered under thestudy of consumer behavior. This all further helpsrelate product / service, price and promotion etc.with consumer behaviour. Thus organisation can placemarketing mix so as to propogate theirproduct/services.The present study on  lays is also trying to findConsumer Perception about different features of layschip and how Price, Environment, Packaging, Quantity,Easy Availability and Variety are affecting the saleof Shampoo’s.PSYCHOGRAPHICIn psychographic segmentation buyers are divided intodifferent groups on the basis of lifestyle and \ orpersonality. People within the same demographic  group

can exhibit very different psychographic profiles.These psychographic bases are often  difficult tomeasure, but they offer potential rewards in terms ofproviding management with a more relevant basis fordifferentiating between segments of a market.LIFESTYLE

 People exhibit   many more lifestyles than are suggested by the seven social  classes. People’s product interests are influenced by their lifestyles. In fact the goods they consume express their lifestyles. Marketers are increasingly segmenting their markets by consumer lifestyles. Companies makingcosmetics, alcoholic beverages, and furniture are always seeking opportunities  in lifestyle segmentation.

PERSONALITY

Personality affects the consumption of many goods, particularly those consumed publicly. An aggressive personality for example, may be reflected in the choice of ostentatious clothing, furniture, and  automobiles. Preferences  are frequently so different that it is impossible to serve all personality types with the same product or brand. A recognition of important personality types can help management “position” it’s towards a profitable segment or segments.

Marketers have used personality variables to segmentmarkets. They endow their products with brandpersonalities that correspond to consumerpersonalities.

CHAPTER-3INDUSTRY PROFILE

INDIAN SNACKS INDUSTRY

Snacks are a part of Consumer Convenience/ Packaged Foods segment. Snack isdescribed as aSmall quantity offood eaten between meals or in place of a meal. Snack food generallycomprises bakery products, ready-to-eat mixes, chips, namkeen and other light processedfoods According to the ministry of food processing, the snack food industry is worth Rs100 billion in value and over 4,00,000 tonnes in terms of volume.Though very large and diverse, the snacks industry is dominated by the unorganizedsector According to an Apeda survey almost 1,000 snack items and 300 types of savoriesare sold across India. The branded snacks are sold at least 25% higher than the unbranded products Savory snacks have been a part of Indian food habit, since almost ages. Thoughthere is no particular time for snacks, normally they are consumed at teatime. The varietyis almost mind-boggling with specialties from all regions, which havegained nationalacceptance industry. he been growing around 10% for the last three years, while the brandedsegment is growing around 25% per annum to stand at Rs5,000-Rs 5,500 crore,due to various reasons like Multiplex culture, snacking at home while watching TV,pubsand bars (where they are served free). AC

Nielsen's retail audit shows that the large salesvolumes are due to a marked preference for ethnicfoods, regional bias towardsindigenous snacks and goodvalue-for-money perception. Of course the branded segmentis much smaller at Rs 2,200 crore, which is what makes it so attractive to foodCompaniesthat are looking at bigger shares and in the branded snacks market, to getdown to basics, Frito Lay commands a share of 45%, followed by Haldiram’s at 27% andITC at 16%. The

lay'sHaldiramITCOthers

rest is divided between a handful of new entrants, wannabes and many regional playersOf the wide range ofsnacks available, potato chips constitute a sizeable segment of theIndian snack food industry, according to India Info line. The potato chip market isgenerally an unorganized industry. Nearly all potato chip snack products aremanufactured and sold locally. Thereis also no uniform standard for packaging, as thereis in Europe, the United States and other more developed regions. Many snack foods are

 

sold loose or packaged in poly-pouches, which may onlybe folded, or in some cases,stapled closed. As the Indian economy continues to grow, and production standardsimprove, many snack food companies are makingsignificant investments into plantequipment and packaging machinery.Pepsi Foods Ltd., now known as

Frito-Lay India Ltd., produces India's largest snack foodManufacturer’s brands, including Ruffles, Hostess, Cheetos and Uncle Chips. Frito Lay'sstory is an example of how Americanrecipeswere adjusted to satisfy local tastes. Procter & Gamble's Pringles brand of potato crisp was launched in Delhi in 1999. Pringles is alsoa baked potato crisp, unlike many other potato based Indian snack foods that are fried.P&G currently imports the Pringles product and therefore the product has been priced at a premium andis marketed to a micro-niche

Chapter- 4

COMPANY PROFILE

Lay's (also known as Walkers in the United Kingdom and Ireland, Smith's in Australia, Chipsy[1] in Egypt, Poca in Vietnam, Tapuchips 

in Israel,[2]Margarita in Colombia and Sabritas in Mexico)is the brand name for a number of potato chip varieties as well as the name of the company that founded the chipbrand in 1932. A company owned by PepsiCo since 1965. Other brands in the Frito-Lay group include Fritos, Doritos, Ruffles,Cheetos, Rold Gold pretzels, Munchos, Funyuns, and Sun Chips

In 1932, salesman Herman Lay opened a snack food operation in Dorset, Ohio and, in 1938, he purchased the Atlanta, Georgia potato chip manufacturer "BarrettFood Company, " renaming it "H.W. Lay Lingo & Company."Lay criss-crossed the southern United States selling the product from the trunk of his car. In 1942, Lay introduced the first continuous potato processor, resulting in the first large-scale production of the product.

The business shortened its name to "the Lay's Lay Lingo Company" in 1944 and became the first snack foodmanufacturer to purchase television commercials, with Bert Lahr as a celebrity spokesman.[3] His signature line, "so crisp you can hear the freshness,"became the chips' first slogan along with "de-Lay-sious!"As the popular commercials aired during the 1950s, Lay's went national in its marketing and was soon supplying product throughout the United States.

In 1961, the Frito Company founded by Elmer Doolin andLay's merged to form Frito-Lay Inc., a snack food giant with combined sales of over $127 million annually, the largest of any manufacturer. Shortly thereafter, Lays introduced its best-known slogan "betcha can't eat just one." Sales of the chips becameinternational, with marketing assisted by a number of celebrity endorsers.

In 1965, Frito-Lay merged with the Pepsi-Cola Company to form PepsiCo, Inc. and a barbecue version of the chips appeared on grocery shelves. A new formulation of chip was introduced in 1991 that was crisper and kept fresher longer. Shortly thereafter, the company introduced the "Wavy Lays" products to grocery shelves. In the mid to late 1990s, Lay's modified its barbecue chips formula and rebranded it as "K.C. Masterpiece," named after a popular sauce, and introduced a lower calorie baked version and a varietythat was completely fat-free (Lay's WOW chips containing the fat substitute olestra).

In the 2000s, kettle cooked brands appeared as did a processed version called Lay's Stax that was intended to compete with Pringles, and the company began introducing a variety of additional flavor variations.

Frito-Lay products currently control 59% of the UnitedStates savory snack-food market.[4]

Flavours

Asia

One flavour sold primarily in southern Asia is called "Magic Masala". This flavour is popular in India, Pakistan, and Bangladesh. It is also sold in Indian deli stores in Canada and the United States. South Asian Lay's chips are ridged, closely resembling another Frito-Lay brand in North America, Ruffles.

In India Lay's is available in the following flavors :"India's Magic Masala", "American Style Cream & Onion", "Spanish Tomato Tango", "Classic Salted" and "West Indies' Hot 'n' Sweet Chili ". In 2013, Lay's released two new flavours, "French Salt & Cracked Pepper" and " Lays Chile Limon". A baked variant of

Lay's called "Lay's Baked" is available in the following flavors : "Original Salted", "Cream, Herb & Onion" and "Sunkissed Tomato".

Flavours featured in Thailand include Nori Seaweed, Basil, Squid, Spicy Chili Squid, Seafood and Mayonnaise, and Spicy Seafood.

In Thailand, there are Classic, Sour Cream & Onion, Cheese & Onion, Mexican Bar-B-Q, and Japanese Nori Seaweed. Temporary international flavours have also been introduced, such as French Mayonnaise, Balsamic Vinegar and Salt (England), Garlic Soft Shelled Crab (Hong Kong), Soy Sauce, Salmon Teriyaki (Japan), Lobster, Bacon & Cheese (America). Other traditional "Thai" flavours include Tom Yum, Thai Chili Paste, Thai Seafood Dip, Chili and Lime.

Lay's China has four ranges of flavours: Cool & Refreshing (Cucumber, Kiwi, Blueberry, Cherry Tomato, and Lime), Classic Flavours (American Classic, ItalianRed Meat, Mexican Tomato Chicken, Texas Grilled BBQ, and French Chicken), Intense & Stimulating (Numb & Spicy Hot Pot, and Hot & Sour Fish Soup), and Stax (Authentic Original, Finger Licking Braised Pork, Seafood Barbecue, Spicy Seafood, Tomato, Crispy Roasted Chicken, Black Pepper Rib Eye Steak, Cucumber,Kiwi, Blueberry, and Lime).

Flavours in Vietnam include Original, Brazilian BBQ, Beijing Roasted Duck, Manhattan Steak, Nori, and Mornay Shrimp.

In Indonesia, Malaysia, and Brunei Darussalam, the flavours are Salmon Teriyaki, Classic Salty, Nori Seaweed, Pizza, Grilled Chicken Paprika, and Fiesta BBQ. It is produced by Indonesian-based PT Indofood

Fritolay Makmur, a joint venture between PT Indofood CBP Sukses Makmur with Seven-Up Nederland B.V.

Since its acquisition of Chipsy, Lay's chips (marketedas Chipsy) in Egypt inherited the Chipsy range of flavours as well as the pre-merger Lay's flavours. These flavours include salt and vinegar, cheese (most likely based on Rumi cheese and the most popular flavour), seasoned cheese, tomato, kebab on charcoal, and chili and lemon.

Lay's, with its original brand, is also produced by the Saudi Snack Foods Company in Saudi Arabia, and is exported to the other GCC countries. It is available in several flavours, including Salt, Salt & Vinegar, Chilli, Chilli-Lemon, Ketchup, French cheese, and Pizza. Lay's Max is available in flavours: Chili, Cheese and Italian Blend. Lay's Forno, which has less fat by 60%, is available in two flavors: Authentic Cheese and Black Pepper.

Nutritional information

As with most snack foods, the Lay's brands contain very few vitamins and minerals in any variety. At ten percent of the daily requirement per serving, vitamin C is the highest. Salt content is particularly high, with a serving containing as much as 380 mg of sodium.

A one-ounce (28 gram) serving of Lay's regular potato chips has 160 Calories, and contains ten grams of fat,with one gram of saturated fat. Kettle-cooked brands have seven to eight grams of fat and one gram of saturated fat, and are 140 Calories. Lays Natural has nine grams of fat, two grams of saturated fat and 150 Calories. Stax chips typically contain ten grams of fat, 2.5 grams saturated fat and are 160 calories per

serving. Wavy Lays are identical to the regular brand,except for a half-gram less of saturated fat in some combinations. The various brands do not contain any trans fats.

A 50 gram serving of Lay's BarBQ chips contains 270 calories, and 17 grams of fat. It also contains 270 mgof sodium, and 15% Vitamin C.

The baked variety, introduced in the mid 90s, feature 1.5 grams of fat per one ounce serving, and have no saturated fat. Each serving has 110 to 120 Calories. Lay's Light servings are 75 Calories per ounce and have no fat.

Lay's Classic Potato chips were cooked in hydrogenatedoil until 2003.]Currently, the chips are made with sunflower, corn and/or canola oil.

Baked Lays are produced in cheddar, barbecue, sour cream and onion, and original flavors.

Vision

Something wonderful—a company that’s allabout good fun—doing good things when itcomes to making snacks and caring for theenvironment..

Mission:

Focus on convenient foods Provide opportunities for growth & enrichment Strive for honesty, fairness and integrity

Objectives :•Produce high quality product & reasonableprice

.• Facilitate as maximum share of market

•Customer satisfaction is the top priority

•Acquire the strong distribution channel

Chapter-6

NEED FOR THE STUDY

NEED FOR THE STUDY:

In the era of tough competition, Customers have become the Judge/King. They decide the winner and the loser. They decide the winner based on the satisfaction they receive from the products. So it is very important for any company to analyze the needs and wants of the customers and measures their level of satisfaction.

This study tried to find out the satisfaction

level of customers of lifestyle and to understand their expectations. This will help them to benchmark and improve.

Chapter-7Objectives of the

study

OBJECTIVES OF STUDY

• To find out what percentage of population likes to eat snacks

. • To find out which flavor of Lay’s is most preferred.

• To analyze the reason for the popularity of the most preferred snack.

• To know the satisfaction level of people whoeat Lay’s.

• To find out how much people spend on snacks weekly.

• To find out the preferences of people for different brands. 

Chapter-8Research

Methodology

Research MethodologyResearch is initiated by examining thesecondary data to gain insight into theproblem. The primary data is evaluated on thebasis of the analysis of the secondary data.

DEVELOPING THE RESEARCH PLAN

The data for this research project would becollected through questionnaire. A structuredquestionnaire would be framed as it is less timeconsuming, generates specific and to the pointinformation, easier to tabulate and interpret.Moreover respondents prefer to give direct answers.Both type of questions i.e. Open ended and closedended, would be used.

COLLECTION OF Data

a)Secondary Data: It was collected from internalsources. The secondary data was collected from

1. The articles,2. News papers, 3. Management books, 4. Internet5. Wikipedia.com6. Indiabusiness.nic.in7. www.google.com8. www.gitanjaligroup.c9. http://infobharti.com 10. http://www.icmrindia.org

b) Primary data: They were the main source ofPrimary data. The method of collection of primary data would be direct personal interview through a structured questionnaire.

Survey done in the markets of Kurnool district in King Market.

Survey done with 100 residents of the place. Survey completed through one to one interactionwith the people. Objective type questions asked in a questioner format.

SAMPLING PLANSince it is not possible to study wholepopulation, it is necessary to obtain

representative samples from the population tounderstand its characteristics.

1) Sampling Units: would comprise of men andwomen.

2) Research Instrument: StructuredQuestionnaire

SAMPLE SIZE

 100 respondents

Chapter-9LIMITATIONS OF STUDY

LIMITATIONS OF STUDY: Bound to only Kurnool city - The limitation ofthe study is it is limited to only the maincity area of Kurnool and ignores the samplesfrom the smaller parts of the district. Thebuying behavior of an individual varies fromplace to place.

Sample size- the sample size of the study isonly 100 which would not give a comprehensiveresult. Many important samples may not beconsidered at all. The conclusion of the studymay not result to an accurate outcome due tothe sample size being small

Time constraint: since the time span for thestudy was less an in depth study and analysiswill become a little difficult.

SCOPE OF STUDY

• To Identify And Measure Changes In Consumer Attitudes, Expectations.

• To Understand The Target Audience And The Market Trends Better

• To Help Companies In Decision Making And Forecasting

Category 1 Category 2 Category 3 Category 40

1

2

3

4

5

6

Series 3

DO YOU PREFER CHIPS?

Yes 89% No 11%

Do u prefer Yes no

98% 11%

Yes No 

yes no0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

WHICH OF THE FOLLOWING CHIPS BRANDS HAVE YOU TRIED

Chips

brands

bingo Lays parle haldirams

Uncle

chips

balaji

diamonds

13% 22% 9% 10% 14% 17% 5%

Bingo 13% Lays 22% Parle 9% Pringles 10% Haldirams 10% Uncle Chips 14% Balaji 17% Diamond 5% Bingo Lays Parle Pringles Haldirams Uncle Chips Balaji Diamond 

WHEN DO YOU PREFER EATING SNACKS DURING THE DAY?

Morning 4% Evening 65% Afternoon 17% Night 14%

Morning Evening Afternoon Night 

1.WHICH SNACKS DO YOU PREFER?

Haldiriam wafers

Uncle Chips

Lays chips

Bingo Pringles Balaji

15% 19% 48% 13% 4%1%

Haldiriam wafers Uncle Chips Lays chips Bingo Pringles Balaji 

DO YOU SEE LAY'S BAKED CHIPS AS AN HEALTHY ALTERNATIVE? Yes 49% No 51% Yes No 

WHICH FLAVOUR DO YOU LIKE MOST IN LAY'S? American Style Cream & Onion39% Classic Salted 9% India’s Lime‘n’ Masala Masti Flavour 12% West Indies’ Hot ‘n’ Sweet Chilli 5% India’s Magic Masala 20% Spanish Tomato Tango 12% French Salt & Cracked Pepper 2% Chile Limon Flavour 1% 

WHICH BAKED FLAVOUR DO YOU LIKE THE MOST? Lays Baked Cream,Herb & Onion Flavour 59% Lays Baked Original Salted 27% Lays Baked SunkissedTomato Flavour 14% Lays Baked Cream,Herb & Onion Flavour Lays Baked Original Salted Lays Baked Sunkissed Tomato Flavour 

AT WHICH PLACES DO YOU CONSUME MAXIMUM SNACKS? In colleges 26% Railway station 22% Bus stop 5% Public places 18% Home 27% office 2% 

WHAT COMPELS YOU TO CONSUME A PARTICULAR BRAND Brand name 18% Quality38% Variants 14% Price 12% Quantity 18% Celebrity endorsing the product 0% Chart Title 

HOW WOULD YOU RATE LAY'S AS A PRODUCT ? 1 of 5 4% 2 of 5 7% 3 of 5 38% 4 of 5 40% 5 of 5 11% 

WHAT PACKAGE SIZE DO YOU PREFER THE MOST ? Rs 5 5% Rs10 70% Rs 20 23%Rs30 2% 

WHO ALL IN YOUR FAMILY PREFER LAY'S children 52% Parents 12% Grandparents 0% All 36% 

DO YOU THINK LAY'S HAS ACQUIRED A GOOD BRAND NAME IN THE MARKET? 87% 2% 11% yes no cant say 

WOULD YOU SUGGEST OTHERS TO BUY LAY'S CHIPS? 55% 18% 27% Yes No can’tsay 

ARE YOU SATISFIED WITH THE NUMBER OF FLAVOURS IT HAS PROVIDED BY LAY'S 87% 13% Yes No 

DO YOU THINK IT IS HEALTHY TO CONSUME LAYS? 19% 81% yes no 

FINDINGS • People prefer quality over quantity and celebrities endorsing the brand.

• People who prefer quality also prefer chips in their diet.

• 86% People think Lay’s has a good brand image.

• 86% people are satisfied with the flavors available. The additional flavor most of them suggested is cheese. • 61% people who think Lay’s is healthy are Punjabi. • People who have rated Lay’s chips as 5,do not find it healthy to consume. • People who do not prefer chips, are the ones who prefer baked chips , and all of them are females

Bibiliography

www.lays.com

www.wikepidea

www.indiasnack industry.com

www.google.com

books

magazines

newspapers