PROJECT REPORT ON:-

CONSUMER PERCEPTION TOWARDS SMARTPHONES

Submitted in partial fulfilment of MBA program

2013-15

Submitted To: SubmittedBy:

Mr. Surjit Kumar Kar ASHMEET SINGH KHANUJA

Assistant Professor

Marketing & Strategy

Certificate by Guide

This is to certify that major research project

work done on “CONSUMER PERCEPTION TOWARDS

CONSUMER DURABLE BRANDS (SMARTPHONE’S)” submitted

to IBS Hyderabad, IFHE University by ASHMEET

SINGH KHANUJA,, KEERTHI CHANDRA & GAYATRI PATRA

in partial fulfilment of the requirement for

the Non-Class Participation - 2. This is a work

carried out by all of them under my supervision

and guidance. This work has not been submitted

anywhere else for any other degree/diploma. The

original work was carried at ICFAI Business

School, Hyderabad.

Date: 05 January 2014

Assistant Professor

Marketing & Strategy

IBS Hyderabad

IFHE University

Hyderabad, Andhra Pradesh

DECLARATION

We hereby declare that the research project

work entitled “CONSUMER PERCEPTION TOWARDS

CONSUMER DURABLE BRANDS (SMARTPHONE’S)” is

submitted to IBS Hyderabad, IFHE University,

Andhra Pradesh is a record of original work

done by us under the guidance of Mr. ……… Kumar

Kar, Assistant Professor, Marketing & Strategy,

…….. Business School, Andhra Pradesh and this

research project work has not been performed

for the award of any other degree or diploma

and similar project if any.

ASHMEET SINGH

KHANUA

KEERTHI CHANDRA

GAYATRI PATRA

MBA SEM -II

2013-15

ACKNOWLEGEMENT

We would like to express our deep gratitude toMr. ……… Kumar Kar Assistant Professor(Marketing & Strategy), ICFAI Business School,IFHE University for his constant support,guidance and motivation which helped us

immensely in completing this project. Theinsistence on taking up a relatively new topichelped us to understand the prospects how theconsumer perceived about the consumer durablebrands. We also would like to thank ourrespondents for giving us their valuable timeand providing us with the information needed tocarry out the research successfully.

ASHMEET SINGH KHANUJA KEERTHI CHANDRA

GAYATRI PATRA

MBA SEM-II 2013-

15

TABLE OF CONTENTS

SRNO.

CONTENTS

1 INTRODUCTION2 LITERATURE REVIEW

3 OBJECTIVES AND HYPOTHESIS OFTHE STUDY

4 RESEARCH METHODOLOGY5 RESULTS AND DISCUSSION6 LIMITATIONS7 REFFERENCES8 ANNEXURE

INTRODUCTION

A Smartphone is a mobile phone built on mobile operatingsystem with enhanced and more advanced computing capabilityand connectivity than a normal mobile phone. The firstSmartphone combine the function of a personal digitalassistant (PDA) with mobile phone. Later, models added thefunctionality of media players, digital cameras, video cameras& GPS navigation system to form one multi tasking device. Manymodern Smartphone also include high resolution camera withtouch screen pad and web browser that display standard webpages. For high speed data accesses the Smartphone includeWiFi function and mobile broadband. In recent years the rapidof development of mobile applications & of mobile commerce hasbeen drivers of smart phone adaption.

The mobile operating system use by modern Smartphone includesGoogle’s android, Apple’s iOS, Nokia Symbian, Rim’s BlackberryOS, Samsung BADA, Microsoft Windows phone, and Hewlett-Packard’s web OS. Such operating system can be installed ondifferent mobile phones and each device can receive multipleOS Software update over its life time. I n this project wediscussed the importance of analysing the consumer perceptiontowards durable brand’s with the help of Smartphone. Local andforeign brand choice affected by various factors such as brandimage, country of origin, brand awareness, brand quality andso on…. In this era of globalisation consumer have become muchmore aware and the perceptions regarding durable brands arechanging at a rapid pace. It has been seen that price &quality of the durable goods are considered to be majorfactors of making their brand choice. Consumer prefer low

brand product because of lower price, similarly in case ofSmartphone’s the increasing demand of low brand Smartphone’sare because of consumer’s affordable prices in India, AsIndian consumer are more price sensitive. But consumers whowant better quality and durability and for the statusenhancement reasons prefer foreign brands, like in case ofSmartphone’s the consumer who wants better quality, durabilityand consider status will prefer Apple Smartphone. Now in orderto understand consumer perception we need to understandculture, so that behaviour of consumer is well understood. Theperception consumers have of a business and its product orservices whether it’s durable or non durable, have a effect onpurchasing behaviour of the consumer that’s why companiesspend lots of money in marketing themselves. They marketingthemselves by providing excellent customer services and otherinfluential programs which can favourable influence theperception of target consumer. With the help of carefulplanning and execution companies can influence thoseperception and foster profitable consumer behaviour. Consumerscontinually synthesise all the information they have about acompany to make a decision about whether the company offersvalue for the money, in a sense consumer perception is anapproximation of reality.

LITERATURE REVIEW

In this project we are going to discuss about the perceptionsof consumer towards durable brand for which we have taken theexample of Smartphone’s to analyse how the consumer perceiveand what are the factors which affect the consumer perceptionregarding a particular product.

Perception:-

Perception is the process by which we select,organise, and interpret information input to create a meaningfull picture of the world. It depend not only on physicalstimuli but also on the stimuli relationship to thesurroundings environment and on condition within each of us.One Person might perceive a fast talking sale person asaggressive and in sincere another person might perceive thatas intelligent and help full. Each person will respond to thesales person differently. People perceive differently becauseof three perceptual processes…

1. Selective Attention2. Selective Distortion3. Selective Retention4. Subliminal Perception

Selective Attention:-Attention is the allocation of processing

capacity to some stimulus. An average person may be exposed todifferent ad’s brand communication a day. But we cannotpossible attend these; we screen most stimuli out – a processcalled Selective Attention.

Selective Distortion:-Even noticed stimuli don’t always come

across in the way the sender intended. Selective distortion isthe tendency to interpret in a way that fits ourpreconception. Consumer will often distort information to beconsistent with prior brand and product belief andexpectations.

Selective Retention:-Most of us don’t remember much of the

information to which we are exposed, but we do retaininformation that supports our attitude and beliefs. Because ofselective retention , we are likely to remember good pointsabout a product we like and forget good points about competingproducts. Selective retention again works for the strongbrands.

Subliminal Perception:- The selective

perception mechanism require consumers; active engagement andthought . A topic that has fascinated armchair marketer forages is subliminal perception. They argue that marketers embed

covert , subliminal message in ads or packaging .consumers arenot consciously aware of them, yet they effect behavior .although it’s clear that mental process include many subtlesubconscious effects , no evidence support the notion thatmarketers can systematically control consumers at that level ,especially enough to change moderately important or stronglyheld beliefs. Consumer perceived value of the Smartphonetradeoff between benefit and sacrifices perceiver by consumer,in which benefits are adopted from the technology ofacceptance model.

Product Level:- Kotler indicates that marketer needs to consider

five product levels when planning market offering. Each levelincreases more consumer value. Five product levels are asfollows:-

Core benefits Basic Product Excepted Product Augmented Product Potential Product

In case of Smartphone market the Core Value for the mostbuyers could be the convenience and timeliness of

communication, including multi-media communication; at thesecond level, the basic might be concrete, communicable, andmulti-function Smartphone product; at the third level,Smartphone user expect that the Smartphone is useful andquality, for example performance, camera, and screen pixels;at the fourth level, the augmented product can be the pleasingdesign and diversity. At the fifth level, the potentialproduct is possibly the voice control system.

According to our survey the major determinant of mobile phoneinclude branding, price, feature, appearance, & lifestyle.Therefore in this study branding, price, feature, appearance,lifestyle, & accessories are sub-assumed into the independentvariable.

1. Branding:-Kotler and Keller suggested that branding could be

divided in two parts – brand awareness & brand image. Brandawareness refers to the ability of the customer to consider abrand under different circumstance. On the other hand BrandImage refers to the perception about the brand which isreflected by the bran associations held in consumer memory.Consumer often choose that product brand that they arefamiliar with because a well known brand gives peopleperception of being safe.

2. Price:-Price of a product is nothing but the cost of

product. Which is the reason the people compare price with thequality of product, consumer generally perceived that if theprice of the product is high then the quality of the productis better. When the utility of the two product is similar and

their prices differ, consumer will choose the option whichchoose the product with lower price to maximise the utility.

3. Feature/ Appearance:-Appearance of the product can influence the

consumer perception easily because products with appealinglook are able to catch consumer’s eyes and get once attention.Appearance of the product is now only satisfied by the needsvisually but also a critical factor in marketing strategies,for example:- Apple made it product look appealing to aconsumer with a snow white industrial design, which save theappearance of Apple product four years.

4. Lifestyle:-Some people think that if they have a good quality

Smartphone it represent their lifestyle. So lifestyle can beconsidered as the factor which distorted consumer perception.

OBJECTIVES OF THE STUDY

Objective of the study is to study the consumerperception towards durable brands. Here we have tostudy how consumer perceive durable brands, howconsumer behaved and what are the factors which effectthe consumer perception regarding durable brands. Thestudy is based upon the primary data collected throughan online survey.

HYPOTHESIS OF THE STUDY

H0: β0= β1= β2= β3= β4= β5= β6= β7=0

Ha: β0≠ β1≠ β2≠ β3≠ β4≠ β5≠ β6≠β7≠0

β0 = intercept β1 = Smartphone’s Technology β2 = Appearance β3 = Features β4 = Brand Value β5 = Size β6 = Accessories β7 = Price

H0 : These factors does not affect the perception of the purchasing behaviour of the consumers.

Ha : These factors does affect the perception of the purchasingbehaviour of the consumer.

RESEARCH METHODOLOGY

The Study: The study was causal in nature with survey

method being used for data collection.

Sampling Design

Population: The population included viewers from IBS

Hyderabad & Other personal contacts.

Sampling frame: Since the data was collected through

personal contact the sampling frame included general

viewers from IBS Hyderabad & Other personal contacts.

Sample size: Sample size was 148 respondents.

Sample elements: Individual respondents were the sample

elements.

Tools used for data collection: Self designed

questionnaires were used to evaluate Audience

Perception of Consumer Perception Towards Consumer

Durable Brand’s with an example of Smartphone’s. Data

was collected on a 7 point Likert type scale, where 1

indicated minimum agreement and 7 indicated maximum

agreement.

Tools used for data analysis: After the collection of

respondent from two days online survey we analyzed the

data on Regression and ANOVAs with the help of SAS 4.2

Statistical Package.

RESULTS AND DISCUSSIONS

Hypothesis tested using Multiple Regression:

H0: β0= β1= β2= β3= β4= β5= β6= β7=0

Ha: β0≠ β1≠ β2≠ β3≠ β4≠ β5≠ β6≠β7≠0

Results Of Multiple Regression

Price and Brand value are the most important considerations in the buying behaviour.

Battery life plays an almost negligible role in the purchasing behaviour of consumers.

For α=.05, P value =.001, which implies that H0 is rejected. ie the variables considered affect the purchasing behaviour of the consumer.

Dependent mean= 0.61972, suggests the sample is slightly in favour of purchasing a Smartphone.

R2=0.4925 suggests that 49.25% of the variance is explained by the model.

Variance Inflation Factor is less than 5 for each of the variable, which suggests lack of multi-collinearity. Thatmeans that each of the variables in consideration is independent on its own.

The distribution of residuals for purchase suggests that the errors are equally distributed among the variables.

All the observations for which the the cook’s D statisticis above the horizontal line are influential. The influential observations can be used for further analysisto study their buying behaviour.

Outliers: an outlier is an observation with large residual. In other words, it is an observation whose dependent-variable value is unusual given its values on the predictor variables. An outlier may indicate a samplepeculiarity or may indicate a data entry error or other problem.

Leverage: An observation with an extreme value on a predictor variable is called a point with high leverage. Leverage is a measure of how far an observation deviates from the mean of that variable. These leverage points canhave an effect on the estimate of regression coefficients.

ANNOVA suggests the following:

55% of the sample rated 7 in how technology affects their purchase behavior.

35% of the sample rated 7 in how appearance affects buying behavior.

45% of the sample rated 7 in how features affects buying behavior.

40% of the sample rated 7 in how brand value affects buying behavior.

35% of the sample rated 6 in how value for money affects buying behavior.

30% of the sample rated 7 in how size of the phone affects buying behavior.

25% of the sample rated 6 in how accessories affect buying behavior.

25% of the sample rated 5 in how the battery life of the phoneaffects buying behavior.

35% of the sample rated 5 in how price affects buying behavior.

25% of the sample rated 7 in how lifestyle of the consumer plays a role in buying behaviour.

LIMITATION

1: Some of the people were not responsive.

2: Possibility of error in data collection because many

of the respondents may have not given a

answer to the questionnaire.

3: Sample size is less to represent the whole

population.

4: The time period of research was short.

5: Respondents behaviour may be casual.

6: Financial resources are not available.

REFERENCES

Marketing Management – Philip Kotler 14e

Marketing Research – Naresh K. Malhotra Fourth

Edition

Statistics for Business and Economics – Anderson,

Sweeney, Williams

ANNEXURE ANNEXURE 1

QUESTIONNAIRE

Consumer perception towards smartphone

NAME

OCCUPATION

Do you have a smart phone?o  YESo  NO

The emergence of smartphones has changed the way we communicate with one another.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree , to 7,Agree,.

Agree

Do you get attracted by the appearance and design of smartphone and then want to own it?

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

My Purchase of smartphone depends on the features the smartphone provides.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

Brand name plays a vital role while purchasing any smartphone.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

I consider the 'value for money' concept while purchasing a smartphone.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

I prefer smartphones which are easy to carry and can be easily fit to my pocket.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

Accessories and other free benifits effect my purchasing decision.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

I look towards the battery life factor if the number of technical applications and functions are less.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

Smartphones are generally high priced.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

I believe that the type of smartphone represents my life style.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree