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A PROJECT REPORT

ON

Study of Consumer Behavior


about Verka Products
Submitted in partial fulfillment of the requirements for the degree of Master
of Business Administration (Marketing) affiliated to Punjabi University,
Patiala.

Project Guide:

SUBMITTED BY:

Mr. Parshotam Kumar

Yogesh Kumar
Global MBA-3rd sem

Incharge Marketing

Roll No. : 120426472

SCHOOL OF MANAGEMENT STUDIES,


PUNJABI UNIVERSITY,
PATIALA

ACKNOWLEDGEMENT

The research on Study of Consumer Behaviour about Verka Products


has been given to me as part of the curriculum in 2-Years Masters Degree in
Business Administration.
I have tried my best to present this information as clearly as possible using
basic terms that I hope will be comprehended by the widest spectrum of
researchers, analysts and students for further studies. I have completed this study
under the able guidance and supervision of Mr. Parshotam Kumar. I will be
failed in my duty if I do not acknowledge the esteemed scholarly guidance,
assistance and knowledge. I have received from them towards fruitful and timely
completion of this work. Mere acknowledgement may not redeem the debt I owe
to my parents for their direct/indirect support during the entire course of this
project.
In the end specially I would like to thank HOD and Staff Members,
Punjabi University for their valuable guidance & for making us capable to
complete my project efficiently & for his co-operative attitude.

Compiled by
Yogesh Kumar

DECLARATION

I am Yogesh Kumar, a Student of MBA 2012-14 Batch, School of Management


Studies, Punjabi University, Patiala. hereby declare that the project on Study of
Consumer Behaviour about Verka Products is my original work and that it has not
previously formed the basis for the award of any other Degree, Diploma, Fellowship or
other similar titles.
It has been done under the guidance of Mr. Parshotam Kumar.

Yogesh Kumar

CERTIFICATE OF COMPLETION

This is Certify that Mr. Yogesh Kumar (3rd semester) has successfully completed her
project titled Study of Consumer Behaviour about Verka Products under the
guidance of Mr. Parshotam Kumar (Incharge Marketing). This is in the partial
fulfillment of her MBA curriculum (Marketing).

Dated:
..
(Project guide)

PREFACE
For management careers, it is very important to develop managerial skills .In order to
achieve positive and concrete results, along with theoretical concepts, the exposure of
real life situation existing in a corporate world is very much needed. To fulfill this need,
this type of practical training is required.
I underwent summer training in VERKA MILK PLANT, located in Sangrur. It was my
fortune to get training in a very healthy company. I got great opportunity to view the
overall working of the organization. In the forthcoming pages, I have attempted to present
a report covering different aspects of my training.

EXECUTIVE SUMMARY
Customers today are more informed and more demanding than ever. They know quality
service when they get it and they arent afraid of taking their business elsewhere if they
dont get it. Most manufacturers have taken this fact to heart because a refusal to
acknowledge this reality can spell - failure - rejection by the one who holds the purse
strings and the key to profits.
Satisfaction of customer needs, in fact, provides a rationale for the firms
existence. Therefore consumer behavior lies at the heart of modern marketing and its
knowledge is vital for a firms existence, growth and success. An understanding of the
motives underlying the consumer behavior helps a firm to seek better and more effective
ways to satisfy consumers.
Consumer behavior, however, is a complex system where there is an interaction of
various social, economic and psychological factors. All these factors affect the purchase
decision of the buyer and his perception about different products. Buying decision
process incorporates all the activities that individuals go through in their role as
consumers. It starts right from the time when there is a state of deprivation (need arousal)
and goes through a point when a means of need satisfaction has been obtained. It ends at
a juncture when the product has been used for a sufficiently long period of time to judge
the level of satisfaction (post - purchase evaluation). Satisfaction is the key to generate
repeat business. It ensures customerloyalty and determines whether a customer would
come to the company again.

TABLE OF CONTENTS
Chapter No.

Contents
Introduction

1.
Industry profile (Milkfed)
Company Profile (Verka)

2.

Organizational Stature of The Unit

3.

Management of Milk Plant Board of Directors Designation.

4.

Main Centers & Branches

5.

Product of Verka

6.

Main Product of Verka Milk Plant Sangrur

7.

Price List

8.

Sale Promotion Method

9.

Distribution Channel

10.

Achievements

11.

Competitors of SMU

12.

Marketing Department

13.

SWOT Analysis

14.

Introduction to Consumer Behavior

15.

Research Methodology

16.

Limitations of Research

17.

Data Analysis and Interpretation

18.

Suggestion and Recommendation

19.

Conclusion

20.

Bibliography

INTRODUCTION
1.1 MILKFED-PUNJAB
(Introduction)
The Punjab State Cooperative Milk Producers Federation Limited popularly known as
MILKFED Punjab, came into existence in 1973 with a twin objective of providing
remunerative milk market to the Milk Producers in the State by value addition and
marketing of produce on one hand and to provide technical inputs to the milk producers
for enhancement of milk production on the other hand.
Although the federation was registered much earlier, but it came to real self in the year
1983 when all the milk plants of the Punjab Dairy Development Corporation Limited
were handed over to Cooperative sector and the entire State was covered under Operation
Flood to give the farmers a better deal and our valued customers better products. Today,
when we look back, we think we have fulfilled the promise to some extent. The setup of
the organization is a three tier system, Milk Producers Cooperative Societies at the
village level, Milk Unions at District level and Federation as an Apex Body at State level.
MILKFED Punjab has continuously advanced towards its coveted objectives well defined
in its byelaws.

1.2 Objectives of MILKFED


1. To provide remunerative prices to milk producers by value addition and marketing of
produce.
2. To provide technical inputs for enhancement of milk production on the other hand.
3. To carry out activities for promoting production, procurement processing and
marketing of milk and milk products for economic development of the farming
community;

4. To purchase and/or erect buildings, plants, machinery and other ancillary equipment to
carry out business;
5. To study problems of mutual interest related to production, procurement and marketing
of dairy and allied products;
6. To establish research and quality control laboratories;
7. To make necessary arrangements for transfer of milk allied milk products and
commodities;
8. To market its products under its own trade name/brand name with its Member Unions
trade mark/brand;

PROFILE OF THE UNIT


The elegant building situated on Patiala road just before we enter Sangrur is that of Milk
Plant owned by The Sangrur District Co-operative Milk Producers Union Ltd. Its
foundation stone was laid by Indias Home Minister Mrs. Uma Shanker Dixit in 1973. It
started its production in 1979.
The original name of the plant was The Malwa Milk Producers Union Ltd. Sangrur.
Its name was changed and registered as The Sangrur Distt. Co-operative Milk
Producers Union Ltd. Sangrur. It has been registered under Punjab Co-operative
Societies Act 1961 on 24 March 1973. This union started its milk procurement from
March 1974.
The union is working under the laws of act. In the beginning 13 societies became its
members. But this union started as milk procurement from 1974. Initially its office was
situated on the upper side of co-operative bank of Barnala. At that time Milk Plant
Sangrur was not existing. Initially the societies of Barnala circle were started, after this it
was expanded and centers were approved at Dhuri and Malerkotla. At that time this union
collects milk from other societies and to Horlicks. Before it, except Horlicks there was no
major buyer of milk and Horlicks was a private concern giving low rates.
After that the union was strengthened and milk producers got benefited by this union as
they were getting reasonable rates for their from. A project report of Milk Plant Sangrur
was made at that time with shares from
Different societies were to be collected and it includes Rs 100 share money and Rs 5
admission fees, 15 lack Rs were to be collected and in this manner and the share of
government was fixed at Rs 40 lack. For the smooth running of the plant, the union had
taken loan of worth Rs 62 lack from Co-operative Development Corporation. By this loan

a milk plant was established. It started milk of 45000 liters per day in December 1979
further it was expanded with the help of National Diary Development Board at ANAND
under the Operation Flood programmed. After few years a drier was installed with a
capacity of 10 tones. For the purchase of this machinery 70% of loan was taken from
NDDB and 30% loan from government in the form of subsidy. The total investment in
the plant was 6.5 crores.

LOCATION AND LAYOUT

In the milk plant there are hard receiving departments: Production and Engineering. The
location of the stores department is carefully planned out and it is housed in a position
which is very near to production department so that transportation charges are minimum.
It is also easily accessible to all other departments like engineering, boiling, refrigeration,
powder plant and workshop.
The layouts of plants store are properly planned. There are shelves, racks,
admirals and handling devices for keeping the material and equipments properly. The
store is divided into racks which are further subDivided into small spaces allocated. Special attention is paid to storage of material which
is liable to leakage or evaporation and deterioration.

SELECTION OF ROUTES:
Routes are selected for the delivery of milk through these societies. Shortest milk routes
are preferable so that milk reach to plant in same condition, otherwise milk can become
sour or curd. The societies which are far away from milk plant, the four milk chilling
centers are established for them. Societies send milk directly to milk plant or through
chilling centers. These chilling centers chill milk at 4 degree Celsius which keeps the
milk in good condition for 24 hours. After chilling the milk these centers send milk to the
milk plant.

REGISTERATION OF THE SOCIETY AND THE MEMBERS:


When a society is fully formed for the collection of milk it is registered under the
registration act of societies. Its members are also registered and given members pass

books and share certificates. A copy of rules and regulations are also given to them. Then
the actual milk collection starts.

MILK PROCUREMENT IN DIFFERENT SEASONS


Milk Plant Sangrur procures milk in three seasons. First comes the lean season i.e. the
months of May. June, July and August. In this season milk is available in very low
quantity i.e. 25000 liters per day. The second season is mid-season i.e. the months of
March, April, September and October. In this season the procurement of milk is about
50000 liters per day. The most awaiting season is flush season i.e. the months of
November, December, January and February. In this season the procurement of milk is
maximum i.e. 65000 liters.

1.3

INTRODUCTION &
GENERAL FEATURES OF MILK PLANT SANGRUR

NAME:

Verka Milk Plant.

ADDRESS:

Verka Milk Plant


Patiala Road, Sangrur

RAW MATERIAL:
PRODUCTS:

Milk.
Ghee, Pasteurized milk,
Milk powder, Curd, Cheese,

Milk Cake, Sweet flavored milk.


WORKING HOURS:

24 hours (3 shifts).

TOTAL WORKERS:

200 Workers in the Three Shifts

Capacity

One Lakh Ltrs per day.

MILK PROCUREMENT IN LAST 7 YEARS:


Year saver age milk procurement per day (in liters) total milk handling.
2001- 85000 liters per/day
2002- 80000 liters per/day
2003- 70000 liters per/day
2004- 75000 liters per/day
2005- 70000 liters per/day
2006-65000 liters per/day
2007- 60000 liters per/day
2008- 62000 liters per day
2009- 57000 liters per day
2010- 55000 liters per day
MAIN CENTRES AND THEIR BRANCHES:
About 300 milk producing societies come under Milk Plant Sangrur which is operating in
the whole Sangrur district. All these are divided into six main centers which are as
under:
LOCAL SANGRUR
MALERKOTLA

140
50

SEHNA

30

MEHAL KALAN

30

CHANGALIWALA

30

SANDHORE

20

(A) MILK PROCUREMENT PER DAY


NAME OF THE SOCIETYMILK PER DAY (in liters) Local Sangrur
Sehna 8000 Mehal Kalan 5000 Chanhaliwala 7000

40000

(B) PRODUCTION

Production is the foundation on which every organization is built. Production is an


internal act of producing something in an organized manner. It is the fabrication of a
physical object through the use of men,
Material and equipment. Thus the basis of production is the transformation of inputs into
goods and services. In milk plant Sangrur two different plants are established for the
production of Ghee and SMP. These are called:
1.

Powder Plant.

2.

Production plant.

In powder plant Skimmed Milk Powder is prepared from spreta milk which comes from
production department. In production plant Ghee is prepared from cream after its
separation from milk. Here pasteurized milk is also prepared. Sometimes milk cake is
also prepared according to its requirement. In addition to it there are arrangements for
filling sweet milk bottles. Powder and Ghee are made only in flush season when milk is
available in large quantity. In lean season production fails because of non-availability of
milk. In months of May, June, August is done; sometimes glucose is made here on
contract basis.

(C) QUALITY CONTROL

Quality control includes techniques and systems for the achievement of the required
quality of the raw material as well as final products. Most often milk vendors adulterate
the milk in such a way that normally consumers are to be fooled. Consumers remain
obvious to the various ways and means adopted by milk vendors to adulterate milk. Here
are some eye openers:
1.

Urea, caustic soda and salt are added to thicken the milk.

2.

Milk powder is also used for thickening and usually the powder used is substandard.

3.

Synthetic milk is added to pure milk to increase the quantity.

4.
Sometimes pure milk is separated, the cream is removed and the skimmed milk
powder is added to it.

(D)

ACCOUNTING :

Accounting is the art of recording, classifying and summarizing in a significant manner,


and in terms of money transactions and events which are in part at least of financial
character and interpreting the results thereof. In milk plant Sangrur this section performs
the functions of maintaining the accounts of stores material and milk products by union
and to make payments at right time. Like this to maintain the accounts of milk and milk
products sold by the union and to receive the payment for goods sold to consumers,
concerned sections and branches. The bills are prepared by accounts branch according to
10 days milk purchase from producers and societies. It is the duty of this section to
maintain the accounts according to rules and regulations mentioned by Registrar Cooperative Department and to follow the restrictions and suggestions imposed by auditor.

(E) MARKETING
Milkfed Punjab is serving nationwide consumers through its network of regional offices
and strong distribution channels. Milkfed markers a wide variety of products liquid milk,
skimmed milk powder and many more.

PRODUCT OF VERKA

Milkfed has formulated company specifications for its milk & milk products and provide
standard and quality of products to consumers. These products are listed below:

Milk

Cheese

SFM(Pio)

Ghee

Ice cream & Sweets

Milk Powder

Curd, Kheer...

Table Butter

Rasella

Plan Lassi

Paneer

Panjiri

Milk Cake

Now Verka has arrived on the sheer strength of its quality, freshness and purity and of
course its home made taste and its products being of most affordable prices. To people
today, Verka is part of their daily life.

1.

Liquid Milk Pasteurized Pouch Packed Milk:-

It is pouch packed milk. It may be used as such or for milk based preparations. It shall be
kept under refrigerated conditions. It is packed in half ltr. Pouch. Its length of shelf life is
48 hours under refrigerated conditions. It is sold in arid around sangrur, sunam, dhuri,
barnala areas. Special distribution control is needed, under refrigerated condition if
transported to very long distance. Verka Milk Plant is preparing three types of milk
pouch:-

Standardized Milk

2.

Full Cream Milk

Double Toned Milk

Milk Powder:-

Dried Milk or Milk Powder is product obtained by the removal of water from milk by
heat or other suitable means to produce a solid containing 5% or less moisture. Whole
milk, defatted or skim" milk may be used for drying. It comes in packing of 200 gms, 500
gms. etc. It can be stored for 1 year before use.
3.

Ghee:-

Ghee may be defined as clarified butter fat prepared chiefly from cow or buffalo milk.
The product can be used on roti/pranthas or can be used as cooking other material for
food. It is preserved at ambient temperature for one year. It is packed on 500 gms, 2 Kgs.,
5 Kgs. & 15 Kgs. bulk pack in tin. It is sold anywhere in Punjab and abroad also. No
special distribution control is needed.

4.
Butter: - Butter may be defined as a fat concentrate which is obtaining by
churning cream, gathering the fat into a compact mass and then working it.
The product obtained from cow and buffalo milk or a combination thereof or from cream
or curd obtained from cow or buffalo milk or a combination thereof, with or without the
addition of common salt and colouring matter. It can be kept under refrigeration for three
months. This comes in packs of 10 gms. 100 gms. And 500 gms.

5.

Lassi:-

Lassi, also called chhas refers to desi butter milk which is by product obtained when
churning curd led whole milk with curd indigenous devices for the production of desi

butter. Verka Lassi is very popular, especially in Punjab and it is also liked by the people
of other states. It comes in the 200 ml. tetra pack.

6.

SFM:-

It is known as Sweetened flavoured milk or bottle milk. The product used in the form of
drinking sweet milk. It is preserved at ambient temperature. It is packed in 200 ml. bottle,
200 ml. tetra packs. The length of shelf life of product can be held far three months under
ambient temperature. It is sold in and around Punjab and upcountry market mainly Delhi.

7.

Ice Cream:-

Ice Cream may be defined as a frozen dairy product made suitable blending and
processing of cream and other milk products, together with sugar and flavour, with or
without colour and with the incorporation of air during the freezing process. There are
mainly three types of Verka Kulfies i.e. Malai Kulfi, Choco bar and Mango bar. Malai
Kulfi made with milk, malai and
Crushed nuts. Choco bar contained chocolate and Mango bar kulfi contain mango
flavour.

8.

Paneer:-

Paneer refers to the small sized soft cheese. The product can be consumed as such or can
be fried and consumed. It can also be used as an ingredient for making Indian Sweets and
paneer based dishes. It is preserved under refrigerated condition for 20 days from the date
of packing. The product is packed in poly film bags. The pack size is 200 gms. For
consumer pack and 5 Kg. Capacity in bulk pack as agreed by contracted buyer.

9.

Curd/Dahi:-

Dahi or curd is the product obtained from boiled milk by souring, natural or otherwise, by
a harmless lactic acid or other bacterial culture. It should have the same percentage of fat
and solids - not - fat as the milk for which it is prepared.

10.

Raseela:-

Raseela is a very popular product of Verka which was launched in 1995. It comes in two
flavours - i) Mango Raseela and ii) Pine apple Raseela. Mango Raseela is prepared from
mango pulp and Pineapple Raseela from pineapple pulp. These are coming in 200 ml.
tetra pack.

MAIN PRODUCTS MANUFACTURED BY MILK PLANT SANGRUR

The main products which are manufactured by the milk plant Sangrur are as under:

1.

Ghee.

2.

Pasteurized Milk.

3.

Milk Powder.

4.

Sweetened Flavored Milk (PIO).

5.

Milk Cake.

6.

Cheese.

7.

Curd.

8.

Panjiri

9.

Lassi Plan

10.

Paneer

MARKETING DEPARTMENT

According to Prof. Phillip KotlerMarketing is the human activity directed as satisfying


need and wants through the exchange process.
Marketing is the process through which producers and consumers of various goods are
brought together in an exchange relationship and the transfer of ownership takes place.
Marketing process starts even before the goods go into production. It does not end with
sale but continues till the satisfaction of consumer is obtained.
To carry out selling functions, it is important to have a qualified and expressed sales force
with leader who can plan, organize, direct and control the selling job objectivity. The
salesman is an extremely important link in the claim of distribution. It is sometimes said
that salesmanship is the other name of persuasion.

MARKETING STRATEGIES
Section of Milk Booths/Agencies Security Money Refundable Agency Rs. 5000 Full time
booths Rs. 10000 Part time booths Rs. 3000 Institutions 45 days advance payment

MARKETING MEASURES FOR DOMESTIC MARKET:

For domestic market following measures are taken up by marketing personnel:


A.

Dealers meeting is called once in every six months.

B.

The plant has own distribution network for the sale of products.

C.
Milk products are marketed to bring up country markets through out India on
consignment basis.

FOR INTERNATIONAL MARKET:

For Export following measures are taken into consideration:


A.

Requirement is given by customers in the letter of credit.

B.

Quality should be mentioned.

DOMESTIC MARKETING ACTIVITIES

The domestic marketing activities are performed on the basis of Demand and Supply.

Demand for milk and milk products are received in two ways:
Through TelephoneAny demand or change in demand is received between 9:30 am and 2:00 pm.
Through SupplyMilk booths collect demand according to milk supplied to the agencies. About 70% of
milk is distributed in the morning and remaining 30% is distributed in the evening.

PAYMENT AND BALANCE SYSTEM

Since agency is required to deposit one day advance payment separately for morning and
evening, if any cash balance remains with the union that is admitted in the meant supply
payment.
For institutions 45 days of advance payment against their demand is collected union.

ROLE OF MARKETING IN VERKA MILK PLANT SANGRUR


Head Office collects this information from all the plants and scrutinizes the information
that which plant has large stock of products and who is lacking in it. Then it gives orders
to plant which has large stock to supply products to other plants so that stock can be
absorbed quickly. The prices of all the products are determined by the H.O. and their
retail price through out India is same H.O. charges 3% commission on sales made by
milk plant, Sangrur.
For the local sale of milk and milk products, a milk bar is opened outside the main gate of
milk plant, Sangrur and its average sales are Rs 5 lakh per day. Some milk products like
liquid milk, Cheese, Milk cake, S.F.M., Ice-cream etc. are sold through local dealers in
the district.

* MARKETING (2008-2009)*

3.1

Overview of past performance


3.1 The Union is selling milk packed in sachet under the brand name of Verka in
Sangrur, Barnala, Dhuri, Longowal, Sunam, Bhawanigarh and a few other small towns
of Sangrur milk shed area. To increase the sale of liquid milk supply in Feb., 2008, the
supply was started in Haryana in the area of Tohana, Barwala, Bhiwani & Rohtak. By
expanding the area for the supply of liquid packed milk, the supply of Milk
Union,Sangrur is increased up to 8 TLPD in February,2008. The supply in Haryana
stopped in the month of July 2008 due to the accident of the vehicle of the retainer, again
supply of liquid packed Milk started in the month of Feb 2009 and again it is stopped in
the month of October 2009. After that the liquid milk supply remains, approximate 5500
liter per day in the small towns of the Sangrur Milkshed area .The demand of liquid milk
in these areas is less because the markets of milk-shed area of Sangrur are semiurban/rural based. Most of the liquid milk is being sold in bulk to other dairies of the
state/district.
3.2 Marketing of milk and milk products other than local sale is being arranged through
Milkfed, Punjab which has national wide operations and a network of regional offices
and strong distribution channel. Milkfed markets a range of products manufactured at its
affiliated milk plants with in the state. All such products are also available to the union
for trading which its operational area.

3.3 By the end of 2008-09 there are 11 dealers are distributing the liquid packed milk to the
retailers in the different markets of Sangrur milk-shed area.
3.4 The Union pays commission to dealers and retailers at the rate of Rs. 0.40 and Rs. 0.90
per liter respectively. The competitors are giving commission to the dealers/retailers Rs.
1.50 to Rs. 2.00 per liter. As the villages closely surrounded towns of the milk shed, the
local vendors are selling most of the milk at a price of about Rs. 22.00 per liter and the
Union is giving standard packed milk @ Rs.25.00 per liter.
3.5 The major reasons for less sale of liquid milk are Credit facility provided by the vendors.
Preference of the consumers for loose milk due to less price of purchase.
3.6 Apart from liquid milk the Union sells Ghee, Table butter, Curd, Paneer under the brand
name of the Verka in markets of Sangrur, Barnala and Longowal to the retailers.
3.7 The Union undertook some promotional activities for boosting its liquid milk sale some
of the salient steps taken are given below.
a. Pamphlets have been distributors through local news paper highlights qualityaspects of
Verka packed milk vis--vis that of loose milk. A special focus has been given to the
threats of consuming synthetic milk.
b. In order to give visibility to Verka products sign boards and banners have been placed at
strategic locations in the urban centers. Advertisements have also been shown on the local
city cable.
c. Arranging visits for school children and teachers to convince them about the hygiene and
cleanliness standards maintained in the plant.
d. Posters affixed on important public places to make customers aware about duplicate or
familiar packing brands selling in the area.
3.8 Future Marketing Strategies
As there are no big cities in the milk-shed area of Sangrur, so the union has started the
supply of liquid packed Milk to Milk union Mohali in the month of May 2007 and
presently we are supplying 15600 Ltr of STD packed milk to MP Mohali. The Union has
proposed to adopt the following strategies for increasing its liquid milk sale.
a. Identifying and appointing retailers in uncovered areas of different towns.
b Brand visibility drives, sales promotion activities and consumer education
programmes are planned to achieve targeted sales volume.
c Launching of new milk products after assessing demand.
d. Market research to know consumer preferences for products and services.

Pricing policy
Market driven pricing policy Differential rates for different markets and different seasons.

PROMOTION METHOD USE IN VERKA MILK


PLANT SANGRUR

ADVERTISEMENT AND SALES PROMOTION

The advertisement and sales promotion of every product is necessary. Without this,
nobody comes to know about the product. Every organization whether it is small,
medium or big has to do some type of advertisement. Verka milk plant has also adopted
some policies for the sale of its products. It has its own Vans, Trucks, and Jeeps etc. for
selling its products. There are also some benefits which are being provided to the dealers.
There is a facility of free training of testing milk to the societies so as to make more
customers. With the adoption of such policies sales have increased in Dhuri,Sunam, and
Barnala as well as in Sangrur. For doing advertisement the shops of retailers have been
painted showing various Verka products and various types of banners are also given to
them which are to be displayed. Advertisement of Verka products is also shown on Local
Cable Networks of Sangrur, Dhuri, sunam and many more cities. Pamphlets are also
being distributed door to door.

Public Relations and Publicity:The appeal of public relations and publicity is based on three distinctive qualities
which are as follows:1. High credibility:- News stories and features are more authentic and credible to readers
than advertisement.
2. Ability to catch buyers off guard:- Public relations can reach prospects who prefer to
avoid sales people and advertisements.
3. Dramatization:- Public relations have the potential for dramatizing a company or
product.
Personal Selling:- It is the most effective tool at the later stage of buying process
particularly in building up buyer preference, conviction and action. It also has three
distinctive qualities.
1.

Personal confrontation:- It involves an immediate and interactive relationship


between two or more persons.

2.

Cultivation:- It permits all kinds of relationship to spring up ranging from a matter


of fact selling relationship to a deep personal friendship.

3.

Response:- It makes the buyer feel under some obligation for having listened to the
sales talk.

DIRECT MARKETING
Although there are many forms of direct marketing like direct mail, telemarketing,
Internet marketing they all share four distinctive characteristics.
1. Non-public:- The message is normally addressed to a specific person.
2. Customized:- The message can be prepared to appeal to the addressed individual.
3. Up-to-date:- A message can be prepared very quickly.
4. Interactive:- The message can be changed depending upon the persons response.

SALESMANSHIP GUIDE

Certain guidelines and motto are being told to the salesmen for meeting the customers
desires and wants. Various guidelines are as follows:

1.

It is said "sell yourself before you sell the product". The above saying is
measuring to create ones own confidence in the minds of customers so as to
ensure sales.

2.

Your sincerity and capability in convincing is your performance for success.

3.

Over convincing never pays single facts convince better.

4.

Always remember that customer is more intelligent than you.

5.

Dont indulge in giving guarantees if wear and tear.

6.

You should be pre-determined in your mind of items, size to be sold to the


customers after stock.

7.

Your expertise is your success.

8.

Dont display all of your varieties because customers generally have the habit of
asking more.

DISTRIBUTION CHANNEL
MILKFED

COMPANY

WHOLESALER

RETAILER

CUSTOMER

ACHIEVEMENTS
Milk Procurement: Milk Plant SANGRUR procured about 55,000 Lt. of milk per day through 19 Milk routes
in the Flush Season.

Animal Health Care & Other Technical Inputs: In addition to Organizing the remunerative Milk market system Through milk producers
cooperative societies, Milk Plant is also providing regular health coverage by running 2
vet nary routes and 55 Artificial Insemination Service Stations at Society level.
Genetic Improvement of Milch Animals Under this, lay inseminators are trained who are
in-turn, doing Artificial Insemination at the door steps of Dairy Farmers.

Quality Assurance Program:


Quality Assurance Program (QAP) which is a part and parcel of Dairy Plant
Improvement Program (DPIP) was taken up in Ludhiana Milk Union with the Technical
guidance from NDDB. The main objective of the program is to improve efficiency of
Plants coupled with loss management to bring down the cost of production, improve the
quality of milk and milk products manufactured to ameliorate the general hygienic and
house keeping standards and above all to enhance the profitability and financial viability
of the Milk Plants to enable milk producers to get better price for their produce.

Competitors of SMU
Competitors of SMU & Qty. Procured in Milkshed Area of SMU (000 LPD) in 2010-11
Sr.No.

Brand Name

Avg./Day

Chammpa.Devi Foods (Malerkotla)

5000

Rajit Milk Plant (Malerkotla)

3729

Mukand Milk (Malerkotla)

6600

Idasa Private LTD (Malerkotla)

5050

GSK (Nabha)

9730

Nestle

7250

Metro

4554

Supreme Khanna

4810

Milk Time

2431

10

Today Milk

1173

Competitors of SMU
Competitors of SMU & Qty. Procured in Milkshed Area of SMU (000 LPD) in 2010-11
Sr.No.

Brand Name

Avg./Day

11

Milkfood Bahadargarh

7572

12

Super khanna

4487

13

Utam Dairy

2076

14

Reliance

9404

15

Milk Food Phewa

4273

16

Modern Dairy Karnal

1587

17

Harman

599

18

BEST Milk Products

40000

19

Mother Dairy

20000

20

Dugdh Sagar Mehsana

1840

SWOT ANALYSIS
STRENGTHS:-

1. Brand Loyalty among the rural people for Verka products.


2. Good brand image of Verka products in the minds of rural people.
3. Faith on Verka products by the rural farmers.
4. Rural people satisfaction with quality, price, quantity and availability is also
strengthening the dairy business.
5.The supreme power is Milkfed which have all authority to take any decision. Verka is
under the power of Milkfed so their responsibility or botheration is minimum.
6. The employees in the verka Milk Plant are peramant of milk. The turn over is less. So
employees job security is there.
7. The Plant has its own societies for the procurement of milk. It collects milk from them
twice in a day.
8. The areas where Verka products are sold have good potential because people in those
areas are educated and prefer Verka products.
9. There are many villages around the area so the transport cost is minimum and there are
less problems of handling of milk.
10. Market network is very strong as there are many dealers who sell its products.

WEAKNESSES :1.

Lack of proper advertisements by the plant, such as posters, glow signs, etc.

2.

Lack of proper distribution system in rural areas.

3.

Lack of proper marketing network in rural areas as like in urban areas.

4.

Very high rates of products such as bottle milk for Rs.1 a/for 200 ml.

OPPORTUNITIES:-

1. Greatly improved expert potential for milk products of western as well as traditional
types.

2. Proper utilisation of available resources to decrease the per unit cost.

3. By product utilisation for import substitution.

4. Growing demand for milk and milk products.

THREATS:-

1. Introduction of foreign products in Indian market.

2. Poor quality of milk.

3.The liberalization of Dairy Industry is likely to be exploited by multi -nationals. They


will be interested in manufacturing milk products which yield high profits. It will create
milk shortage in the country adversely affecting the consumers.

4. Export of quality feed under the liberalization policy.

INTRODUCTION
TO THE
CONSUMER
BEHAVIOR

INTRODUCTION TO CONSUMER BEHAVIOUR


As a consumer we are all unique and this uniqueness is reflectedin the consumption
pattern and process of purchase. The studyof consumer behaviour provides us with
reasons why consum-ers differ from one another in buying using products andservices.
We receive stimuli from the environment and thespecifics of the marketing strategies of
different products andservices, and responds to these stimuli in terms of eitherbuying or
not buying product. In between the stage of receivingthe stimuli and responding to it, the
consumer goes throughthe process of making his decision.
Consumers and their behaviour is an important dynamic for any business to understand if
it wishes to succeed. Consumers increasingly exert influence on businesses through their
buying behaviour. Understanding consumer behaviour is therefore imperative as it
informs businesses how to plan their marketing activities and sustain themselves as
commercially viable and useful entities. The book has been written to meet the needs of
most course outlines of southern African universities, universities of technology and
private colleges. While providing the student with a thorough theoretical grounding in
consumer behaviour, the book moves swiftly into southern African marketing and
business scenarios, and focuses on current and future issues, both nationally and
internationally. Key features and benefits: Text and layout is well-structured to guide and
assist the learning process; Southern African case studies, applications and research
findings ensure local relevance; International case studies, applications and research
findings broaden the scope and variety; Self-assessment questions challenge students to
engage with the material. The authors are well-known in the industry and have a wealth
of experience in the marketing and consumer related environments.
Consumer Behavior may be defined as the interplay of forces that takes place during a
consumption process, within a consumers self and his environment.

this interaction takes place between three elements viz. knowledge, affect and
behavior;
it continues through pre-purchase activity to the post purchase experience;
it includes the stages of evaluating, acquiring, using and disposing of goods and
services.

The consumer includes both personal consumers and business/industrial/organizational


consumers.
Consumer behavior explains the reasons and logic that underlie purchasing decisions and
consumption patterns; it explains the processes through which buyers make decisions.
The study includes within its purview, the interplay between cognition, affect and
behavior that goes on within a consumer during the consumption process: selecting, using
and disposing off goods and services.

Cognition: This includes within its ambit the knowledge, information processing and
thinking part; It includes the mental processesc involved in processing of information,
thinking and interpretation of
stimuli (people, objects, things, places and events). In
our case, stimuli would be product or service offering; it could be a brand or even
anything to do with the 4Ps.
Affect: This is the feelings part. It includes the favorable or unfavorable feelings and
corresponding emotions towards a stimuli (eg. towards a product or service offering or a
brand). These vary in direction, intensity and persistence.
Behavior: This is the visible part. In our case, this could be the purchase activity: to
buy or not a buy (again specific to a product or service offering, a brand or even related
to any of the 4 Ps).

Nature of Consumer Behavior:


i.

The subject deals with issues related to cognition, affect and behavior in
consumption behaviors, against the backdrop of individual and environmental
determinants. The individual determinants pertain to an individuals internal self
and include psychological components like personal motivation and involvement,
perception, learning and memory, attitudes, self-concept and personality, and,
decision making. The environmental determinants pertain to external influences
surrounding an individual and include sociological, anthropological and economic
components like the family, social groups, reference groups, social class, culture,
sub-culture, cross-culture, and national and regional influences.

ii.

The subject can be studied at micro or macro levels depending upon whether it is
analyzed at the individual level or at the group level.

iii.

The subject is interdisciplinary. It has borrowed heavily from psychology (the


study of the individual: individual determinants in buying behavior), sociology
(the study of groups: group dynamics in buying behavior), social psychology (the
study of how an individual operates in group/groups and its effects on buying
behavior), anthropology (the influence of society on the individual: cultural and
cross-cultural issues in buying behavior), and economics (income and purchasing
power).

iv.

Consumer behavior is dynamic and interacting in nature. The three components


of cognition, affect and behavior of individuals alone or in groups keeps on
changing; so does the environment. There is a continuous interplay or interaction
between the three components themselves and with the environment. This impacts

consumption pattern and behavior and it keeps on evolving and it is highly


dynamic.
v.

Consumer behavior involves the process of exchange between the buyer and the
seller, mutually beneficial for both.

vi.

As a field of study it is descriptive and also analytical/ interpretive. It is


descriptive as it explains consumer decision making and behavior in the context
of individual determinants and environmental influences. It is analytical/
interpretive, as against a backdrop of theories borrowed from psychology,
sociology, social psychology, anthropology and economics, the study analyzes
consumption behavior of individuals alone and in groups. It makes use of
qualitative and quantitative tools and techniques for research and analysis, with
the objective is to understand and predict consumption behavior.

vii.

It is a science as well as an art. It uses both, theories borrowed from social


sciences to understand consumption behavior, and quantitative and qualitative
tools and techniques to predict consumer behavior.

Scope of Consumer Behavior:


The study of consumer behavior deals with understanding consumption patterns and
behavior. It includes within its ambit the answers to the following:
- What the consumers buy: goods and services.
-Why they buy it: need and want
-When do they buy it: time: day, week, month, year, occasions etc.
-Where they buy it: place
-How often they buy it: time interval
-How often they use it: frequency of use

The scope of consumer behavior includes not only the actual buyer but also the various
roles played by him/ different individuals.

Basic Components:

i) Decision making (Cognitive and Affect):This includes the stages of decision making: Need
recognition, Information search, Evaluation of alternatives, Purchase activity, Post
purchase behavior.

ii) Actual purchase (Behavior):


This includes the visible physical activity of buying of goods
and/or service. It is the result of the interplay of many individual and environmental
determinants which are invisible.

iii) Individual determinants and environmental influences:


The environmental factors affect the decision process indirectly,
through way of affecting individual determinants.

iv) Buying roles:


Actual Buyer vis a vis other users. There are five buying roles, viz.,
Initiator, Influencer, Decider, User, Buyer. The initiator is the person who identifies that
there exists a need or want; the influencer is the one who influences the purchase
decision, the actual purchase activity and/or the use of the product or service; the decider
is the one who decides whether to buy, what to buy, when to buy, from where to buy, and
how to buy; the buyer is theone who makes the actual purchase; and, the user is the
person (s) who use the product or service. These five roles may be played by one person
or by different persons. A person may assume one or more of these roles. This would
depend on the product or service in question.

Example1:

1:

A child goes to a kindergarten school. She comes back home and asks her parents to buy
her a set of color pencils and crayons. Now the roles played are:

1. Initiator: the child in nursery school


2. Influencer: a fellow classmate
3. Decider: the father or the mother
4. Buyer: the father or the mother
5. User: the child

Example 2:
The lady of a house who is a housewife and spends her day at home doing household
chores watches TV in her free time. That is her only source of entertainment. The TV at
home is giving problem. She desires a new TV set, and says that she wants an LCD
plasma TV. Now the roles played are:
1. Initiator: the housewife (mother)
2. Influencer: a friend / neighbour
3. Decider: the husband or the son
4. Buyer: the husband or the son
5. User: the family
Consumer behavior focuses specifically on the Buyer and often User.But also analyzes
impact of other roles.

v) Buyers and Sellers:


They are the key elements in consumer behavior. They have needs and
wants and go through a complex buying process, so as to be able to satisfy the need
through purchase of the good or service offering. They enter into an exchange process
with the seller, which leaves both the parties (buyer and seller) better off than before. In
fact the exchange process is value enhancing in nature, leading to satisfaction of both the
parties.

Relevance of Market
Consumer Behavior :

Research

with

Each individual is unique in himself/herself and, needs and wants vary from person to
person; thus, consumers are different and heterogeneous. However, like-minded clusters
of customers do exist; they are homogenous within such clusters and heterogeneous
outside; these are referred to as segments. Marketers identify segments and target one or
few of these segments, and thereby fulfil the qualifications of the marketing concept;
first, marketers identify customer needs and wants; and then, deliver product and service
offerings so as to satisfy the customers more efficiently and effectively than the
competitors. In order to understand and predict consumption patterns and behaviors
within segment (s), market research becomes essential.

Market research may be defined as:


- an organized effort to gather information about the market and the customers.
- systematic collection, analysis and interpretation of data related to the market and the
surrounding environment.
The environment surrounding a Company may be grouped as the micro-environment
and the macro environment. The micro-environment comprises forces in the
environment that are close to the company and affect the company directly; for example,
the companys internal environment, the founder/leader and his vision and mission, the
customers, competitors, suppliers, and channel intermediaries. The macro- environment
on the other hand,comprises forces in the environment that first affect the micro
environment and through that they affect the company; in other words they affect the
company indirectly; examples are the demographic factors, socio-economic factors,
political factors, technological factors, cultural factors, natural factors etc. The forces in
the macro environment affect all the companies operating in a same industry in a similar
manner.

The micro-environment is studied in terms of strengths (S) and weaknesses (W), while
the macro-environment is studied in terms of opportunities (O) and threats(T). The
analysis of both of these put together comprises the SWOT analysis.

Approaches to Consumer Behavior Research:


Broadly speaking there are two approaches towards consumer behavior research. These
are (a) Traditional approach (b) Current approach. These can be further divided into sub
approaches.

(a) Traditional approach:


This is further divided into two approaches, Positivist and
Interpretivist.
i) Positivist approach:
This approach also referred to as modernism, is the earliest approach to studying
consumer behavior and treats the study as an applied science; the paradigm lays emphasis
on science as a means of explaining behavior. It lays emphasis on the causes of consumer
behavior and as per its proponents, these causes are directly related to effects. Thus, it
treats consumers as rational human beings, who make purchase decisions after
collecting information and weighing all alternatives. The process of consumer decision
making is looked upon as one of rationality. Rational decision making and problem
solving is the key.
The approach is based on certain assumptions viz.,
-consumer actions based on cause and effect relationship can be generalized; they can be
objectively measured and empirically tested;
- if a marketer/researcher could identify the reasons behind consumption behavior; he
would be able to predict it; and if they could predict consumer behavior, they could
influence it.
The focus lies on prediction of consumer behavior. The methodology is essentially
quantitative, with techniques including surveys, observations, and, experiments. It aims at
drawing conclusions on large samples.

ii) Interpretivist approach:


This approach is also referred to as post-modernism or experientalist. Gradually there
was a shift in the approach towards the study of consumer behavior and the positivist
approach gave way to a new approach that came to be called post-modernism. The
approach lays emphasis on understanding the customer better. It treats consumer decision
making process as one which is subjective. Thus while the approach is essentially
subjective, the researchers following this approach try to identify common patterns.

This approach is also based on certain assumptions viz.:


- consumer actions are unique and different both, between two consumers, and/or within
the same consumer at different times and situations.
- a cause and effect relationship cannot be generalized; consumption patterns and
behaviors are unique; these are unpredictable.
- they cannot be objectively measured, empirically tested and generalized.
The focus lies on the act of consumption rather than the act of purchase. The
methodology is essentially qualitative, with techniques including in depth interviews,
focus group techniques, projective techniques. It aims at drawing conclusions on small
samples.

(b) Current approach:


Dialectical: The term dialectics considers all forms of human behavior; thus the
current approach to the study of consumer behavior research is broader in scope. This is
further divided into four approaches, Materialism, Change, Totality and Contradiction.

i) Materialism:
This approachimplies that consumer behavior is shaped by the material environment
eg. money, possessions etc.

ii) Change:

Consumer behavior is dynamic in nature; it is always in a process of continuous


motion, transformation and change.
iii) Totality:
Consumption behavior is interconnected with other forms of human behavior, like
personal self and the surrounding environment.

iv) Contradiction:
Views changes in consumer behavior as arising from their internal contradictions, like
moods, emotions etc.

The approach studies the consumer as a complex total whole and views
consumer purchase as well as consumption processes. The current approach to studying
Consumer Behavior uses both the quantitative as well as qualitative approaches.

Research Perspectives on Consumer Behavior


There are three broad research perspectives in consumer behavior. They are as follows:
the Decision-Making perspective, the Experiential perspective, and Behavioral-Influence
perspective.

The Decision-Making Perspective:


According to the decision making perspective, the buying process is a sequential in
nature, with the consumer perceiving that there exists a problem and then moving across
a series of logical and rational steps to solve the problem; stages being problem
recognition, information search, evaluation of alternatives, purchase decision, and post
purchase behavior. This perspective emphasizes the rational, logical and cognitive
approach to consumer decision making and purchase process.

The Experiential Perspective:

The experiential perspective believes that not all buying may be rational and logical; in
some cases, buying results from a consumers desire for fun and fantasy, hedonic
pleasures, emotions and moods. The perspective emphasizes that consumers are feelers
as well as thinkers.

The Behavioral Influence Perspective:


This perspective holds that forces in the environment stimulate a consumer to make
purchases without developing beliefs and attitudes about the product.

Research Paradigms in Consumer Behavior :


The research paradigm in the study of consumer behavior focuses on two approaches
viz.,Quantitative research, used by the positivists and, Qualitative research: used by the
interpretivists. The positivists and interpretivists as two schools of thought have already
been discussed in the previous lesson. The current approach or the dialectic approach to
studying Consumer Behavior makes use both the approaches.

a) Quantitative Research in Consumer Behavior:


As the name suggests, the approach makes application of quantitative research techniques
to the study of Consumer Behavior. It comprises (i) research techniques that are used to
gather quantitative data over large samples randomly, and (ii) statistical tools and
techniques, inclusive of survey techniques, observation and experiments. This type of
research is descriptive and empirical in nature. It is primarily used by the positivists while
studying consumer behavior, with a focus on prediction of consumer behavior. The
findings can be generalized to marketing situations. As mentioned above, the quantitative
techniques are also used by dialectics.

b) Qualitative Research in Consumer Behavior:


This approach makes application of qualitative research techniques to the study of
Consumer Behavior. It comprises (i) research techniques that are used to gather
qualitative data over small samples randomly and, (ii) non-statistical tools and
techniques, inclusive of depth interviews, focus group, projective techniques and even

observation. The type of study is subjective and non-empirical in nature. It lays emphasis
on the holistic what, where, when, why and how of human behavior. The focus is on
understanding consumption behavior and consumption patterns. The objective is to gain
an understanding of consumer behavior and the underlying causes that govern such
behavior. The approach assumes that all marketing situations are unique; and, hence the
findings cannot be generalized to marketing situations. This approach is primarily used
by the interpretivists while studying consumer behavior. However, as mentioned above,
the qualitative techniques are also used by dialectics.

c) Combining the two approaches:


Today, the two approaches are used in combination to study consumer behavior.
Qualitative research is very often a prelude to quantitative research; the findings from
qualitative research are used to prepare scales for surveys and experiments.
In some cases quantitative research may also act as a precursor to qualitative research; the
findings from quantitative research are corroborated through case studies and other
qualitative measures.

MODELS OF CONSUMER BEHAVIOR:

i) Model of Consumer Buying:


The consumer market is defined as end user markets. Also called Business to Consumer
markets, or B2C markets, the product and service offering is bought by the consumer for
his personal use. The decision making process in consumer markets is different from the
one that takes place in business or industrial markets.
The components/processes as well as the working dynamics are explained as follows:

1. Marketing and other stimuli:


A consumer is confronted with a stimulus in the environment. This stimulus could be
of two kinds;

a) One that is presented by the marketer through the marketing mix or the 4Ps, product,
price, place and promotion;
-product: attributes, features, appearance, packaging etc.
-price: cost, value, esteem (prestige)
-place: location and convenience, accessibility
-promotion: advertising, sales promotion, personal selling, publicity, direct marketing.
b) The other that is presented by the environment, and could be economic, technological,
political and cultural.

2. Buyers black box:


The stimuli that is presented to the consumer by the marketer and the environment is then
dealt with by the buyers black box. The buyers black box, comprises two sub
components, viz., the buyers characteristics and the buyer decision process.
The buyers characteristics could be personal, psychological, cultural and social. The
figure of model of consumer behavior is as follow:-

Figure1: Model of Buyer Behavior

Buyers Charactristics:
Consumer behavior refers to the selection, purchase and consumption of goods and
services for the satisfaction of their wants. There are different processes involved in the
consumer behavior. Initially the consumer tries to find what commodities he would like
to consume, then he selects only those commodities that promise greater utility. After
selecting the commodities, the consumer makes an estimate of the available money which
he can spend. Lastly, the consumer analyzes the prevailing prices of commodities and
takes the decision about the commodities he should consume. Meanwhile, there are
various other factors influencing the purchases of consumer such as social, cultural,
personal and psychological. The explanation of these factors is given below.

1. Cultural

Factors

Consumer behavior is deeply influenced by cultural factors such as: buyer culture,
subculture, and social class.
Culture
Basically, culture is the part of every society and is the important cause of person wants
and behavior. The influence of culture on buying behavior varies from country to country
therefore marketers have to be very careful in analyzing the culture of different groups,
regions or even countries. The set of basic values perceptions, wants, and behaviours
learned by a member of society from family and other important institutions. Culture is
the most basic cause of a persons wants and behaviour. Every group or society has a
culture, and cultural influences on buying behaviour may vary greatly from country to
country.
Subculture
Each culture contains different subcultures such as religions, nationalities, geographic
regions, racial groups etc. Marketers can use these groups by segmenting the market into
various small portions. For example marketers can design products according to the
needs of a particular geographic group. It includes

A group of people with shared value systems based on common life experiences
and situations.

Each culture contains smaller sub cultures a group of people with shared value
system based on common life experiences and situations. Sub culture includes
nationalities, religions, racial group and geographic regions. Many sub culture
make up important market segments and marketers often design products.

Social Class
Every society possesses some form of social class which is important to the marketers
because the buying behavior of people in a given social class is similar. In this way
marketing activities could be tailored according to different social classes. Here we
should note that social class is not only determined by income but there are various other
factors as well such as: wealth, education, occupation etc. Almost every society has some
form of social structure, social classes are societys relatively permanent and ordered
divisions whose members share similar values, interests and behaviour.

2. Social Factors
Social factors also impact the buying behavior of consumers. The important social factors
are: reference groups, family, role and status.
Reference Groups
Reference groups have potential in forming a person attitude or behavior. The impact of
reference groups varies across products and brands. For example if the product is visible
such as dress, shoes, car etc then the influence of reference groups will be high.
Reference groups also include opinion leader (a person who influences other because of
his special skill, knowledge or other characteristics).

Two or more people who interact to accomplish individual or mutual goals.


A persons behavious is influenced by many small groups. Groups that have a
direct influence and to which a person belongs are called membership groups.
Some are primary groups includes family, friends, neighbours and coworkers.
Some are secondary groups, which are more formal and have less regular
interaction. These includes organizations like religious groups, professional
association and trade unions.

Family
Buyer behavior is strongly influenced by the member of a family. Therefore marketers
are trying to find the roles and influence of the husband, wife and children. If the buying

decision of a particular product is influenced by wife then the marketers will try to target
the women in their advertisement. Here we should note that buying roles change with
change in consumer lifestyles. Family members can strongly influence buyer behaviour.
The family is the most important consumer buying organization society and it has been
researched extensively. Marketers are interested in the roles, and influence of the
husband, wife and children on the purchase of different products and services.
Roles and Status
Each person possesses different roles and status in the society depending upon the
groups, clubs, family, organization etc. to which he belongs. For example a woman is
working in an organization as finance manager. Now she is playing two roles, one of
finance manager and other of mother. Therefore her buying decisions will be influenced
by her role and status.

A person belongs to many groups, family, clubs, organizations.


The persons position in each group can be defined in terms of both role and
status.
For example. M & X plays the role of father, in his family he plays the role of
husband, in his company, he plays the role of manager, etc. A Role consists of the
activities people are expected to perform according to the persons around them.

3. Personal Factors
Personal factors can also affect the consumer behavior. Some of the important personal
factors that influence the buying behavior are: lifestyle, economic situation, occupation,
age, personality and self concept.
Age
Age and life-cycle have potential impact on the consumer buying behavior. It is obvious
that the consumers change the purchase of goods and services with the passage of time.
Family life-cycle consists of different stages such young singles, married couples,
unmarried couples etc which help marketers to develop appropriate products for each
stage. People changes the goods and services they buy over their lifetimes. Tastes in food,
clothes, furniture, and recreation are often age related. Buying is also shaped by the stage
of the family life cycle.
Occupation
The occupation of a person has significant impact on his buying behavior. For example a
marketing manager of an organization will try to purchase business suits, whereas a low
level worker in the same organization will purchase rugged work clothes. A persons
occupation affects the goods and services bought. Blue collar workers tend to buy more

rugged work clothes, whereas white-collar workers buy more business suits. A Co. can
even specialize in making products needed by a given occupational group. Thus,
computer software companies will design different products for brand managers,
accountants, engineers, lawyers, and doctors.
Economic Situation
Consumer economic situation has great influence on his buying behavior. If the income
and savings of a customer is high then he will purchase more expensive products. On the
other hand, a person with low income and savings will purchase inexpensive products. A
persons economic situation will affect product choice.
Lifestyle
Lifestyle of customers is another import factor affecting the consumer buying behavior.
Lifestyle refers to the way a person lives in a society and is expressed by the things in
his/her surroundings. It is determined by customer interests, opinions, activities etc and
shapes his whole pattern of acting and interacting in the world.
Personality
Personality changes from person to person, time to time and place to place. Therefore it
can greatly influence the buying behavior of customers. Actually, Personality is not what
one wears; rather it is the totality of behavior of a man in different circumstances. It has
different characteristics such as: dominance, aggressiveness, self-confidence etc which
can be useful to determine the consumer behavior for particular product or service. Each
persons distinct personality influence his or her buying behaviour. Personality refers to
the unique psychological characteristics that lead to relatively consistent and lasting
responses to ones own environment.

4. Psychological Factors
There are four important psychological factors affecting the consumer buying behavior.
These are: perception, motivation, learning, beliefs and attitudes.

Motivation
The level of motivation also affects the buying behavior of customers. Every person has
different needs such as physiological needs, biological needs, social needs etc. The nature
of the needs is that, some of them are most pressing while others are least pressing.
Therefore a need becomes a motive when it is more pressing to direct the person to seek

satisfaction. Motive (drive) a need that is sufficiently pressing to direct the person to seek
satisfaction of the need.

Perception
Selecting, organizing and interpreting information in a way to produce a meaningful
experience of the world is called perception. There are three different perceptual
processes which are selective attention, selective distortion and selective retention. In
case of selective attention, marketers try to attract the customer attention. Whereas, in
case of selective distortion, customers try to interpret the information in a way that will
support what the customers already believe. Similarly, in case of selective retention,
marketers try to retain information that supports their beliefs. The process by which
people select, Organize, and interpret information to form a meaningful picture of the
world.

Beliefs and Attitudes

Customer possesses specific belief and attitude towards various products. Since
such beliefs and attitudes make up brand image and affect consumer buying
behavior therefore marketers are interested in them. Marketers can change the
beliefs and attitudes of customers by launching special campaigns in this regard.
Belief is a descriptive thought that a person holds about something
Attitude, a Persons consistently favourable or unfavourable evaluations, feelings,
and tendencies towards an object or idea.

Buyers Decision Process :


Research and studies into these factors can provide a marketer with knowledge that can
help him serve the consumers more effectively. These characteristics affect the buying
decision process, which comprises five steps:

a) Problem recognition:
This is the first stage where a person recognizes that there is a problem or a need to
fulfill. This may either be an actual state (AS Type), where a problem has arisen and
needs to be sorted out; the product is failing, or the consumer is running short of it, and
thus needs a replacement. A problem could also be a desired state (DS Type), where there

is an imbalance between the actual state and the desired state; another product seems
better and superior to the one that is being currently used, and so the consumer wants to
buy it.
A need could be triggered off by an internal stimulus or an external stimulus. Marketers
need to identify what could trigger a particular need.

b) Information search: After a need is recognized, the consumer goes for an information
search, so as to be able to make the right purchase decision. He gathers information about
the product category and the variations, various alternatives and the various brands. Such
a search could be ongoing, specific or incidental.
The consumer could recalls information that is stored in his memory (comprising
information gathered and stored, as well as his experiences, direct and indirect). He could
also seek information from the external environment. The sources of information search
could be personal (family, friends, peers and colleagues), commercial (marketers
communication in the form of advertising, salespersons, publicity etc), public (mass
media, consumer forums, government rating agencies) and experiential (self and others
experiences). Personal contacts are highly influential sources, public sources are highly
credible.

c) Evaluation of alternatives:
Once the consumer has gathered information and identified the alternatives, he compares
the different alternatives available on certain features. These are those features that a
consumer considers in choosing among alternatives; these could be functional/utilitarian
in nature (benefits, attributes, features), or subjective/emotional/hedonic (emotions,
prestige etc.).The consumer also uses decision rules that help a consumer simplify the
decision process. At the end of the evaluation, purchase intentions are formed.

e) Post purchase behavior:


After the purchase, the consumer uses the product and re evaluates the chosen alternative
in light of its performance viz. a viz. the expectations. He could be experience feelings of
neutrality , satisfaction or dissatisfaction . This phase is significant as it: (i) acts as an experience and gets stored in the memory;

(ii) affects future purchase decisions;


(iii) acts as a feedback.

4.Buyer responses: While in the black box, the buyer also takes a decision with respect
to the product, brand, dealer, timing and amount.

(ii) Model of Industrial Buying:


The business/industrial market is defined as a market that buys, transforms/processes
and sells further, either for further transformation/processing or, for consumer use. The
business market consists of all the organizations, that buy goods and services for further
use in the production and supply of other goods and services that are sold to others. Also
called Business to Business markets, or B2B markets, the product and service offering is
bought by one business organization and further processed/transformed/assembled
consumer for further sale either to another business consumer or a personal consumer.
The business markets are very different from consumer markets; they are huge in terms
of size and investment; contain fewer but larger and bulkier buyers; they are
geographically concentrated; its a derived demand and there is more inelasticity; demand
also fluctuates very rapidly. The buying situation that an industrial buyer faces could
range between a straight rebuy, a modified-rebuy and a new-task. These situations are
based on the complexity of the problem being solved, the newness of the product
requirement, the risk involved, the number of people involved in the buying process.
With business markets being different than industrial markets, the decision making
process in business/industrial markets is also different from the one that takes place in
consumer markets. The buying decision is taken in a very formal and professional
manner by a group of people who are referred to as the buying center. It is highly

formalized, bureauctartic and very complex. The buyers and sellers work very closely
and try to build long term alliances and partnerships.

Figure 2: Model of Business Buyer Behavior

According to Kotler and Armstrong, the basic model of business consumer decision
making process comprises three major components, viz., the environment (these act as
influences), the buying organization (these are related to the buying center, the decision
process and the influences) and the buyer responses (this is the response part). The
components/processes as well as the working dynamics are explained as follows:

1. The Environment: The environment surrounding the business organization comprises


the marketing stimuli in terms of the marketing mix or the 4Ps, product, price, place and
promotion; It also comprises the other stimuli in terms of economic, technological,
political, cultural and competitive environment. They environment acts as a stimulus to
act; it provides strengths and opportunities and also helps identify weaknesses and
threats.

2. The Buying Organization: The buying organization comprises the buying center
which goes through the entire buying process. The buying center is the decision making
unit of the buying organization; it is a formally defined unit and comprises people from
various departments and functional areas; the various members of the unit, vary in
personal background, interest and preferences as also their buying motives, habits and

orientations. Membership, power balance and dynamics vary for different products and
buying situations. In case of a new-task, when the product/service is being purchased for
the first time, the engineering and the R&D personnel have a major role to play and act
powerful; In cases of the straight-rebuy (routine purchases; repeat orders) and modifiedrebuy situations (where product specifications are modified), purchase department acts
powerful.

Figure 3: Major Influences on Industrial Buying Behavior

There are various factors that influence the buying decision in industrial buying behavior,
viz, environmental, organizational, interpersonal and individual.

a) Environmental:

Economic: Various stages in the business cycle (inflation, depression, recession


etc) and their resultant impact on money flows in the economy, level of demand ,
government orientation towards economy and monetary policies (interest rates
etc).

Technological: Rate of technological change; Technology transfer and adoption;


Technology versus environment; Kind of technology adopted.
Competitive: Amount of competition (number of competitors); Nature of
competition; Dynamics of competition.
Political: Political stability/instability; Governmental philosophy and orientation
towards investment, growth and development.

Natural environment: Availability of natural resources; Impact of industry on the


environment; Environmental depletion; Environmental pollution; Waste and
disposal etc.

b) Organizational:

Philosophy and orientation of the founder, directors and executives.

Company vision, mission and strategy.


Objectives of the company.
Policies and procedures for purchase (Centralized versus decentralized; Quality
versus price; Short term versus long term contracts; Intranet and extranet; Supply
chain management; Partnership management).
Structures, systems for purchase: Buying center constituents, power dynamics and
balances.

(c) Interpersonal and Individual:


The buying center comprises people from various departments and functional areas.
Every constituent is an individual in himself. He is different from others in terms of
demographic and psychographic backgrounds in terms of age, income, personality, risk
attitude, culture etc. The buying centre is diverse in terms of varying interests and
orientations towards buying, as well as varying interests, authority, status, empathy, and
persuasiveness.

The buying center comprises people from various departments and functional areas.
Every constituent is an individual in himself. He is different from others in terms of
demographic and psychographic backgrounds in terms of age, income, personality, risk
attitude, culture etc. The buying centre is diverse in terms of varying interests and
orientations towards buying, as well as varying interests, authority, status, empathy, and
persuasiveness.
The decision making process in industrial buying is much more elaborate and complex
than consumer buying. Robinson and Associates have identified eight stages and called
each of the stages as buyphases.
a) Problem recognition: The buying process begins when someone in the organization
identifies a need. A need could be triggered off by an internal stimulus or an external
stimulus.

b) General need description: The product/service requirement is laid out in very broad
terms.
c) Product specification: Then the concerned department/person specifies the products
characteristics and requirements.
d) Supplier search: Business organizations generate for themselves a list of vendors. This
list is drawn up from trade directories, websites, trade shows etc. In case of a straight
rebuy or a modified rebuy, the buyer can refer to such a database. In cases of a new-task,
he would have to search for new vendors.
e) Proposal solicitation: Thereafter, the buyer would invite suppliers to submit their trade
proposals; such an invitation could be placed in the newspapers, trade journals and
company websites. The vendors are asked to submit details related to the product
specifications, features, price, delivery time and period etc,
f) Supplier selection: After the proposals have been submitted by the vendors, the buyer
would go in for an evaluation of the suppliers. The buying center would establish the
evaluative criteria, i.e. the basis on which the vendors would be evaluated. These criteria
would vary across products/services, buying situations etc. In cases of government
organization, the prime consideration while evaluating suppliers is the price. The buying
center needs to take decisions on:
- how many suppliers to use.
- whether quality is a major determinant or price is a major determinant.
- total evaluation of the supplier, including his reputation.
g) Order-routine specification: Once the busying center has taken a decision on the
selection of the vendor, the formal requisition is made in terms of listing the technical
specifications, quantity required, delivery terms, negotiated price, payment terms,
damages, return policies etc.
h) Performance review: The buyer reviews the performance of the chosen supplier(s) on a
regular basis. This evaluation helps the buyer later in cases of straight rebuy and modified
rebuy. On the basis of an evaluation, the relationship/contract with the supplier is
continued or terminated.
3. Buyer responses: While in the black box, the buyer also takes a decision with respect
to the product/service choice, supplier choice, order quantity, delivery terms and times,
service terms and payment.

RESEARCH METHODOLOGY
INTRODUCTION

According to Prof. Phillip Kotler,Marketing research is the systematic, design,


collection, analysis and reporting of the data and finding relevant to specific marketing
situation facing the company.
Marketing is restless, changing dynamic field. Since 1920 many important and dramatic
changes have taken place in marketing, thousands of new products including those of
entries of new industries such as automobiles, electronics and computer, textile, walk
product etc. have appeared in the market. The market orientations have changed from
production to market.

STEPS OF MARKETING RESEARCH PROCESS:DEFINING PROBLEM AND RESEARCH OBJECTIVES


DEVELOPING THE RESEARCH PLAN
COLLECTION OF DATA
PRESENTATION OF THE FINDINGS

The first step of marketing research is defining the problems and research objectives.
Following are the problems and objectives which are to be defined:

To ascertain the frequency of using Verka product.

To ascertain rescannable price of Verka products.

To ascertain the best product of Verka brand.

why people prefer Verka products.

To know about sales pattern.

To know the competition level faced by Verka products in the market.

#
etc.

To know the opinion of people about Verka products regarding its taste, packing

DEVELOPING THE RESEARCH PLAN


The second step of marketing research process calls for developing the most
efficient plan for gathering the needed information. While designing a research plan we
have to take decisions regarding data sources, search approached, search instruments,
sampling etc. There are two plan contact methods which are as follows:

A.

DATA SOURCES

There are two types of data sources:


1.

Primary Data:-

Personal interviews are conducted which enable collection of oral verbal response. This
is fact to face contracted with structured or sometimes even unstructured patterns. This
helps in obtaining indent information.

2.

Secondary Data:-

Secondary data can be obtained from different Milkfed magazines and annual reports,
financial documents referred.

B.

RESEARCH APPROACH
Survey Method :- Survey are best suited for descriptive research companies which
undertake surveys to learn about peoples knowledge, beliefs, preferences, satisfaction
etc. to measure these magnitude in the general population. While observation and tours
are best suited for exploratory research which is not the case of our study.

C.

RESEARCH INSTRUMENT

Questionnaire
A questionnaire is prepared and used to collect the information. The majority of
questions are close ended. Questionnaire is distributed to people to know about their
preferences, tastes, demands etc. This is one of the easiest methods of collecting
information.

D.

SAMPLING PLAN

After deciding on the research approach and instrument, we must design a sampling plan.
This plan calls for three decisions:

1. Sampling Unit:Here we define what is to be surveyed i.e. the target population that will be sampled. In
our case the general public in cities and towns come under the sampling unit.

2.

Sample Size:-

Large samples give more reliable results. In our study 100 customers were
surveyed in Sangrur, Sunam.

3.

Sampling Procedure:-

Area sampling is using because it is not practically possible to visit all places of
India therefore Sangrur, Sunam chosen for survey.

E.

CONTACT METHOD:-

In this decision is taken that how the object should be contacted i.e. whether by mail
questionnaire, telephone, interviews. In our research personal interview is the most
convenient and reliable method.

F.

COLLECTION OF THE INFORMATION:-

The data collection phase of the marketing research is the most expensive and most error
prone process. There can be error as some respondent can give biased or dishonest
answer for the collection of the information. The researchers personally go to customers
to collect the reliable data. Here all knowledge of the researcher about that field comes to
test the ingenuity of the research.
Here I got the experience of working professionally and independently on the road which
gives some taste of practical marketing. I also got a lot of exposure about the market. The
present study undertaken is descriptive in nature and in this study questioning people
with regular expertise in that are being used.

Limitations of research:1) Due to sangrur being a large city, it was not possible to interact with people from all
over the city or even district.

2) Few consumers were reluctant to fill the questionnaire as they perceived us as sale
men and also shown reluctance in giving their contact numbers.

3) Time period for the project execution was less as ample time could not be given to
each customer and vice versa as they have to fulfill their other obligations also.

4) Interaction with dealers was also difficulty as they were busy with their customers
most of the time.

5) There is no measure to check out whether the information provided by the consumers
is correct or not.

DATA ANALYSIS
AND
INTERPRETATION

ANALYSIS & INTERPRETATION


1. Kind/source of milk You Sold?

Packed

34

Dairy

25

Milkman

41

Interpretation: According to 100 respondents 34% dealers says that they use to use
packed milk, 25% says they sell dairy milk and rest 41% says they use milk brought by
milkman.

2:

How you ever Sold Verka Products?

Answer

Percentage

Yes

60

No

40

Percentage

40%

Yes
No

60%

Interpretation: According to 100 respondents 60% dealers says that they use to verka
product and 40% dealers do not use verka product..

3:

From the following which Verka products you have sold ?

Products

Percentage

Milk

55

Ice-Cream

25

Lassi

All & Others

15
Percentage
60
50
40
30
20
10
0

Percentage

Milk

IceCream

Lassi

All &
Others

Interpretation: According to 100 respondents 55% dealers says that they use to sell
packed milk, 25% says they sell ice cream and 5% says they sell verka lassi and rest are
15% sold other product of verka.

4:

Since when you are selling Verka milk Product?

Time in Years

Percentage

57

1-5

34

More than 5

9
Percentage
9%
1
34%

1-5

57%

More than 5

Interpretation: According to 100 respondents 57% dealers says that they are using the
milk product last one year, 34% from 1 to 5 year and 9% dealers using the milk more
than 5 year..

Q5: Do you think whether the price is reasonable for Verka milk
products?

Answer

Percentage

Yes

45

No

55

Percentage

45%
55%

Yes
No

Interpretation: According to 100 respondents 45% dealers says that the price of verka
milk product is reasonable and remaining 55% dealers says that the price is not
reasonable.

6:

What do you think about the packing of the different Verka

products?

Answer

Percentage

Good

68

Ok

Satisfactory

Poor

15

Very poor

Percentage
80
60
40
20
0
or

ry
Sa

Po

tis
fa
ct
o

er
ag
e
Av

G
oo

Percentage

Interpretation: According to 100 respondents 68% people says that the packing of verka
products are good, 8% people says that packing is ok, 9% says satisfactory and remaining
15% says that the packing of verka products are poor so according to this analysis
packing is good.

7:

According to the customers opinion taste of the Verka products

are?

Answer

Percentage

Good

64

Average

Satisfactory

18

Poor

10

Very poor

Percentage
80
60
40
20
0
or
Po

ry

Sa

tis
fa
ct
o

er
ag
e
Av

G
oo

Percentage

Interpretation: According to 100 respondents 64% dealers says that the taste of verka
product is good, 8% says that its taste is average, 18% dealers satisfactory with this and
10% dealers says that the taste is poor.

8:

What is your opinion about the quality of the various Verka

products?

Answer

Percentage

Excellent

13

Good

51

Satisfy

26

Poor

10

Very poor

Percentage
60
40
Percentage
20
0
Excellent

Good

Satisfy

Poor

Interpretation: According to 100 respondents 13% dealers says that the quality of verka
products are excellent, 51% dealers says that the quality is good, 26% people satisfy with
this and remaining 10% dealers says that it is poor.

Likert scale
For comparing verka products with Today & Amul with respect to likert type scale
has been used.

Services Excellent Good

Average Poor

Very

Total

of verka (5)

(3)

(2)

poor

weighted %

15
10
10

(1)
0
0
0

average
429
408
367

Packing 68
Taste
64
quality 13

(4)
8
8
51

9
12
26

Relative

35.63
33.88
30.48

Note:- Responses of excellent were assigned weight of (5) good responses were assigned
weight of (4) responses of average (3) and responses of poor and very poor were assigned
weight of (2) and (1) respectively. And respective responses were multiplies with their
corresponding weight to get total weighted average and then their relative percentage was
calculated.

9. Are the customer aware that full cream milk is the best for
growing children & sports person as it contain 6.0% of facts?
Yes

63

No

37

Interpretation: According to 100 respondents 63% dealers says that they are aware
about that full cream milk is the best for growing children & sports person as it contain
6.0% of facts and rest 37% says that they are not aware that full cream milk is the best for
growing children & sports person as it contain 6.0% of facts.

10:

Have you ever seen the advertisement of the Verka Products?

Answer

Percentage

Yes

24

No

76

Percentage

24%
Yes
No
76%

Interpretation: According to 100 respondents 76% dealers says that they have not seen
the verka advertisement and 24% says that they have seen the advertisement. As clear
from analysis mostly people have not seen the verka advertisement.

11:

When you like to buy verka products?

Answer

Percentage

During Traveling

27
18

For Break
As a Health Tonic

35

For Enjoy

20

Percentage
40
30
20
10
0
For Enjoy

As a
Health
Tonic

For
Break

During
Traveling

Percentage

Interpretation: According to 100 respondents 27% people says that they like to buy
verka products during traveling, 18% people buy during break time, 35% people buy as a
health tonic and remaining 20% buy verka products only for enjoy.

SUGGESTION AND RECOMMENDATION


RECOMMENDATIONS REGARDING PRODUCT:Verka has presently four variants of liquid milk in market but still it is not able to
segment market according to consumers preferences. The only differentiation in these
variants is the color of the packs. Variants name should be printed on the packs in such a
way that they are clearly visible to the consumers. Different punch lines should be
designed for different variants. This will help in formulating advertisement strategy and
reaching the targeted customers. For example, verka smart double toned milk is offered
recommended by doctors to heart patients. It can be targeted in health conscious people.
Plain lassi which comes in one litre pack only should be available in smaller packs like
250ml or 500ml.
Kheer is available in 125gm pack, which is quite small and is recommended to be packed
in larger pack like family size packs so that it can be consumed conveniently as a sweet
dish by whole family.

CONCLUSION

Working conditions, management and Company Rules and regulations are the cause of
grievance among the verka milkfed, sangrur workers.
Opinion survey and open door policy are taken by the management to know the
grievances of the verka milkfed, sangrur employees.
. Oral grievance and written grievance at large in the organization. verka milkfed,
sangrur company should face the grievance from time to time so as to achieve
No more than a week time taken for an organization to solve a grievance case.Verka
milkfed, sangrur workers discuss their grievances with the supervisor to the management
or through a media
Verka milkfed, sangrur management show positive attitude towards the workers in
grievance handling. Organization have a well defined procedure for grievance handling.
Organization reviews the grievance procedure from time to time. There is always a
chance to communicate grievances to the verka milkfed, sangrur management.

From the above discussion and study of Grievances Handling System in verka milkfed,
sangrur we can say that the most popular causes of the grieva.t1ces in, the company are
canteen and uniform. To resolve these problems the company has adopted two methods.
These methods are individual and collective grievance procedures. According to these
procedures the grievance can be resolved by step by step via Supervisors and HODs. But
the grievant can also approach the GM directly if there is a big issue.
The most of the workers are satisfied with the present grievances redressal procedure of
the company. They all know the procedures very well and they are' satisfied because this
company has resolved their, problem and grievances very well in short time.

BIBLIOGRAPHY

www.slideshare.net/.../an-introduction-to-consumer-behavior

www.nptel.iitm.ac.in/courses/110105029/

www.managementstudyguide.com/consumer-buying-behaviour.htm

http://www.marketing91.com/factors-affecting-consumer-buying-behavior/

www.scribd.com/doc/6037268/Customer-Buying-Behavior

consumerbuyingbehaviour.com/

www.multimediamarketing.com/mkc/buyerbehaviour/

www.businessdictionary.com/.../consumer-buying-behavior.html

www.docstoc.com/docs/.../Define-Consumer-Buying-Behaviour

Kotler, P., Marketing Management, 11th edition, Prentice-Hall India,

Schiffman, L.G. and Kanuk, L.L., Consumer Behavior, Eight Edition, 2004,
Prentice Hall, India.

Peter, P.J. and Olson, J.C., Consumer Behavior and Marketing Strategy,
Seventh Edition, 2005, McGraw-Hill Higher Education.

THANKS

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