SUMMER INTERNSHIP TRAINING PROJECT

ON
“HOW TO MAINTAIN CUSTOMER RELATIONSHIP WITH
COMPANY OR ORGANISATION”

Under the guidance of

Mr, Saurabh Agrawal
Cluster Manager
Karvy stock broking limited
Submitted for the partial fulfilment for the award of degree of
Master of Business Administration from Uttar Pradesh Technical
University, Lucknow
By
PRASHANT MISHRA
(Roll No. 1712470090)

INSTITUTE OFCOOPERATIVE & CORPORATE

MANAGEMENT, RESEARCH & TRAINING

21/467, RING ROAD, INDIRA NAGAR, LUCKNOW -226016

1
 DECLARATION

I, PRASHANT MISHRA, a student of Master of Business Administration (MBA)

Programme at the Institute of Cooperative & Corporate Management Research &

Training, Lucknow hereby declare that all the information, facts and figures used in

this research project titled “HOW TO MAINTAIN CUSTOMER

RELATIONSHIP WITH COMPANY OR ORGANISATION” have been

collected by me. I also declare that this project report has been prepared by me and the

same has never been submitted by the undersigned either in part or in full to any other

university or institute or published earlier.

This information is true to the best of my knowledge and belief.

Date: (Student’s name)

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 ACKNOWLEDGEMENT

I owe my greatest to Respected Director Sir MR. RAJEEV YADAV. I express my

thanks to the Principal of ICCMRT LUCKNOW K.ANBUMANI for extending his

support and valuable guidance.

I would also like to thank my college mentor DR.RESHMA FARHAT Associate

professor who has also helped me a lot in this project and gave me her support

guidance,

I would like to thank Mr. Saurabh Agarwal (Cluster Manager, Varanasi) who

gave me the opportunity to express my gratitude to assigning this important project to

me.

Last but not the least I am indebted to my PARENTS who provided me their time,

support and inspiration needed to prepare this report.

Finally, i would like to express to my Sincere Thanks to all those who helped me in

successful completion of my summer training.

(PRASHANT MISHRA)

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 PREFACE

Education becomes more meaningful when its theoretical aspects are combined with

the practical experiences. This provides an opportunity to the student to improve their

understanding of the studies.

Master of Business administration is a course which combines with theory and its

applications as its contents of study in the field of management as a part of this course.

Every aspirant has to undergo AT LEAST SIX WEEKS Summer Training in an

organisation of repute and the purpose of this training is to expose the student of

management to real business situation and to provide insight into the various functions

carried out within the organisation.

I am fortunate enough to get the opportunity of my “Summer Training” in

“KARVY STOCK BROKING LIMITED”

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 TABLE OF CONTENT

CHAPTER TOPIC Page No.

INTRODUCTION OF THE TOPIC 8-39

COMPANY PROFILE 40-65

OBJECTIVE OF STUDY

RESEARCH METHODOLOGY 70

 Research design

 Sampling technique

 Type of data &data collection

Data analysis and interpretation

Findings

Suggestion and recommendations

Conclusion

Bibliography

Annexure(Questionnare)

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INTRODUCTION OF CUSTOMER RELATIONSHIP
MANAGEMENT

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The biggest management challenge in the new millennium of liberalization and
globalization for a business is to serve and maintain good relationship with the king –
the customer. In the past producers took their customers for granted, because at that
time the customers were not demanding nor had alternative source of supply or
suppliers. But today there is a radical transformation. The changing business
environment is characterized by economic liberalization, increasing competition, high
consumer choice, demanding customer, more emphasis on quality and value of
purchase etc.

All these changes have made today’s producer shift from traditional marketing to
modern marketing. Modern marketing calls for more than developing a product,
pricing it, promoting it and making it accessible to target customer. It demands
building trust, a binding force and value added relationship with the customers.

The process of developing a cooperative and collaborative relationship between the

buyer and seller is called customer relationship management shortly called CRM.
According to Ashoka dutt head of Citi Bank “the idea of CRM is to know the
individual customer intimately, so that the company has a customized product ready
for him even before he asks for it.”

The term Customer Relationship Management (CRM) describes systems and

processes within companies which, with the help of customer data, aim to unify and
improve customer service in order to achieve higher levels of customer loyalty.
Customer Relationship Management brings together various departments, such as
sales and marketing, to ensure a uniform approach which ultimately contributes to
increasing the company’s success.

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 CUSTOMER RELATIONSHIP MANAGEMENT

The goal of CRM is to bring together all of the company’s relevant departments so
they can work together to maintain customer relationships. This, of course, does not
mean that departments take on the roles and functions of other departments (e.g. sales
will not initiate marketing measures). CRM can be broadly subdivided into the
following three areas/ processes:

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• Marketing

• Sales/distribution

• Customer service

The task of marketing is to use CRM data to address existing customers individually
using various measures. Depending on the size of the target group, this could be via
direct contact but may also include newsletters, customer brochures, surveys and
similar methods. And because new customer data can be collected using CRM
software, customer relationship management is, of course, a particularly helpful tool
for communicating information in both directions. Marketing is tasked with winning
new customers and uses CRM data to do so. This data also keeps the marketing
department informed about which measures and which marketing channels are the
most promising.

Following these marketing efforts, the sales department is committed to selling to new
and existing company contacts through direct and individual communication. This can
be achieved, for example, by means of a conversation in which the exact needs and
wishes of a customer are established, but custom deals and special conditions for
certain orders are also possible.

For CRM purposes, it is important that this ongoing communication continues to

gather even more customer data so that customer requirements are increasingly better
defined and thus better fulfilled. As a result of this CRM process, the customer feels
well-looked-after and is therefore more inclined to place further orders.

In customer relationship management terms, customer service can only apply to

existing customers, but it can make a significant contribution to customer loyalty.

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During after-sales service, employees can demonstrate that they are truly interested in
a customer’s needs or problems, which can thus show that the company is not just
focused on sales alone.

CRM software also plays an important role here because the customer data collected
during the marketing and sales phases enables customer service to deal with
customers as individuals. If the customer had expressed any particular wishes during
earlier (sales) negotiations, the customer service department can now inquire as to
whether these have been implemented to the customer’s satisfaction. This gives the
customer the feeling that his or her needs are being handled by a genuine partner.

HISTORY OF CUSTOMER RELATIONSHIP MANAGEMENT

Customer Relationship Management (CRM) is one of those magnificent concepts that

swept the business world in the 1990’s with the promise of forever changing the way
businesses small and large interacted with their customer bases. In the short term,
however, it proved to be an unwieldy process that was better in theory than in practice
for a variety of reasons. First among these was that it was simply so difficult and
expensive to track and keep the high volume of records needed accurately and
constantly update them.

In the last several years, however, newer software systems and advanced tracking
features have vastly improved CRM capabilities and the real promise of CRM is
becoming a reality. As the price of newer, more customizable Internet solutions have
hit the marketplace; competition has driven the prices down so that even relatively
small businesses are reaping the benefits of some custom CRM programs.

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In the beginning…The 1980’s saw the emergence of database marketing, which was
simply a catch phrase to define the practice of setting up customer service groups to
speak individually to all of a company’s customers. In the case of larger, key clients it
was a valuable tool for keeping the lines of communication open and tailoring service
to the clients needs. In the case of smaller clients, however, it tended to provide
repetitive, survey-like information that cluttered data bases and didn’t provide much
insight. As companies began tracking database information, they realized that the bare
bones were all that was needed in most cases: what they buy regularly, what they
spend, what they do.

Advances in the 1990’sIn the 1990’s companies began to improve on Customer

Relationship Management by making it more of a two-way street .Instead of simply
gathering data for their own use, they began giving back to their customers not only in
terms of the obvious goal of improved customer service, but in incentives, gifts and
other perks for customer loyalty. This was the beginning of the now familiar frequent
flyer programs, bonus points on credit cards and a host of other resources that are
based on CRM tracking 3333 customer activity and spending patterns. CRM was now
being used as a way to increase sales passively as well as through active improvement
of customer service.

True CRM comes of age really began in earnest in the early years of this century. As
software companies began releasing newer, more advanced solutions that were
customizable across industries, it became feasible to really use the information in a
dynamic way. Instead of feeding information into a static database for future
reference, CRM became a way to continuously update understanding of customer
needs and behavior. Branching of information, sub-folders, and custom tailored
features enabled companies to break down information into smaller subsets so that
they could evaluate not only concrete statistics, but information on the motivation and
reactions of customers.

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 The Internet provided a huge boon to the development of these huge databases by
enabling offsite information storage, where before companies had difficulty
supporting the enormous amounts of information. The Internet provided new
possibilities and CRM took off as providers began moving toward Internet solutions.
With the increased fluidity of these programs came a less rigid relationship between
sales, customer service and marketing. CRM enabled the development of new
strategies for more cooperative work between these different divisions through shared
information and understanding, leading to increased customer satisfaction from order
to end product.

Today, CRM is still utilized most frequently by companies that rely heavily on two
distinct features: customer service or technology. The three sectors of business that
rely most heavily on CRM -- and use it to great advantage -- are financial services, a
variety of high-tech corporations and the telecommunications industry. The financial
services industry in particular tracks the level of client satisfaction and what
customers are looking for in terms of changes and personalized features. They also
track changes in investment habits and spending patterns as the economy shifts.
Software specific to the industry can give financial service providers truly impressive
feedback in these areas. In recent years however, several factors have contributed to
the rapid development and evolution of CRM. These include:

• The growing de-intermediation process in many industries due tithe advent of

sophisticated computer and telecommunication technologies that allow producers to
directly interact with end- customers. For example, in many industries such as
airlines, banks insurance, software or household appliances and even consumables,
the de-intermediation process is fast changing the nature of marketing and
consequently making relationship marketing more popular. Databases and direct
marketing tools give them the means to individualize their marketing efforts.

• Advances in information technology, networking and manufacturing technology have

helped companies to quickly match competition. As a result product quality and cost
are no longer significant competitive advantages.

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• The growth in service economy. Since services are typically produced and delivered
at the same institution, it minimizes the role of the middlemen.

• Another force driving the adoption of CRM has been the total quality movement.
When companies embraced TQM it became necessary to involve customers and
suppliers in implementing the program at all levels of the value chain. This needed
close working relationships with the customers. Thus several companies such as
Motorola, IBM, General Motors, Xerox, Ford, Toyota, etc formed partnering relations
with suppliers and customers to practice TQM. Other programs such as JIT and MRP
also made use of interdependent relationships between suppliers and customers.

• Customer expectations are changing almost on a daily basis. Newly empowered

customers, who choose, how to communicate with the companies’ various available
channels? Also nowadays consumers expect a high degree of personalization.

• Emerging real time, interactive channels including e-mail, Atman call centre that
must be synchronized with customer’s non-electronic activities. The speed of business
change, requiring flexibility and rapid adoption to technologies.

• In the current era of hyper competition, marketers are forced to bemire concerned
with customer retention and customer loyalty.

• As several researchers have found out retaining customers is less expensive and more
sustainable competitive advantage than acquiring new ones.

• On the supply side it pays more to develop closer relationships with a few suppliers
than to develop more vendors.

• The globalization of world marketplace makes it necessary to have global account

management for the customers.

Definition of Customer Relationship management

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 “CRM is concerned with creating improved shareholder value through the use of
customer centric business processes and the development of appropriate relationships
with consumers.”

Implementing CRM:

• CRM requires an integration of a firm's resources; people, operations and marketing

capabilities to deliver added value to the customers. CRM should provide businesses
and organizations with a ‘single view’ of their customers and across irrespective of
the interactive channel or medium through which the customer accesses the service or
product. For example, a business (e.g. hotel) customer’s profile and personal
references should be accessible to the business(or hotel) irrespective of channel i.e.
whether the customer books online, calls in or walks into any location should not
make difference to the service provided based on the personal profile of the business
client.

It is enabled through:

• Information

• Processes

• Technology

• Applications

A firm that wants to implement CRM must align its business processes cross-
functionally in the best possible way to allow increased customer focus with an aim to
deliver added value to the customer.

To implement CRM, the following steps must be followed:

• Develop a CRM framework

• Align current business processes

• Design new cross-functional business processes (where required)

• Develop Functional Specifications (client-side services)

• Develop Technical Specifications

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• Match Technical Specifications to available technology (Systems, software, etc)

• Product Configuration

• Data Migration and Integration

• Staff Training

Customer Segmentation:

For CRM to be effective, the organization’s customer base must be stratified into
segments based on commonalities amongst groups’ of individuals and customers.
This also requires the organization to have strategies to target consolidated customer
segments.

Reduced Cost of Service:

A customer relationship strategy should reduce the cost of service for both the
organization and its customers and increase satisfaction levels.

Service as a differentiator:

The more competitive a market becomes the more a business will need to rely on its
superior product quality and quality of service to differentiate itself from other
businesses and providers.

Tie-in’s over time:

The greater the effort a customer spends one relationship over time, the greater the
customer’s stake in helping to ensure that the relationship works and the more
convenient and loyal the customer becomes.

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 Pitfalls to avoid:

Many CRM programs fail for two reasons:

• Lack of supportive business processes: Because business processes and organizational

goals are not part of a strategic CRM plan tied to organizational goals and objectives.

• Lack of an enterprise perspective: For Relationship Marketing to be effective, it

requires that the organization creates seamless enterprise view. A lot of CRM
programs fail because they are assembled with disparate components that aren’t
designed to work together as part of a complete CRM system designed to meet
organizational objectives.

Customer Relationship Management Model

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Customer Retention Programs

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 1) Create peaks in the customer experience

2) Continuously test email strategies

3) Create a VIP program for your customers

4) Be where your customers are

5) Be passionate and engaged

6) Offer time-limited promotions

7) Be transparent and honest with your customers

8) Don’t over-promise

9) Create a customer community around your brand

10) Incentivize social shares

• Create peaks in the customer experience

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 A few unique, low-cost initiatives can go a long way to delighting your customers and
building loyalty. Think of the last time you received a welcome surprise, it is probably
easier to recall than its unwelcome counterpart. Find milestones in the customer
relationship and find ways to reward customers that they won’t expect. For example,
imagine a customer orders their third pair of shoes. A week later, they receive a pair
of socks that match with a handwritten note thanking them for their business. These
type of unexpected displays of appreciation could go a long way (especially in the
social sharing world) to improve customer experience and offsetting the cost of the
item many times over.

• Continuously test email strategies

In addition to using the data you already have on your customers — like what they
have purchased or browsed — to tailor the content and product recommendations in
your email marketing campaigns, be sure to also constantly test incentives and other
factors to see what is most effective. For example, find out which subject lines elicit
the most opens and what cadence of email increases customer engagement for your
audience.

• Create a VIP program for your customers

Sometimes the greatest motivator of behavior is the status you can achieve. A VIP
program takes loyalty points to the next level by giving customers elevated status and
exclusive offers in addition to increasing rewards as they continue to shop with you.
The more they shop, the more they get!

• Be where your customers are

Consumer behavior has undoubtedly evolved. It’s the consumer who now dictates to
brands where, when, and how they want to engage. Therefore, it’s incumbent upon
retailers to provide a consistent and seamless experience on all channels; particularly

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 when something goes wrong and customers need help. Research from Zen desk
suggests that 87% of customers think brands need to put more effort into providing a
seamless customer service experience.

• Be passionate and engaged

Truly care about your clients! For us, as an agency, that doesn’t mean smiling at your
meetings and sending them little gifts (though you should do that too!), but actually
doing your due diligence to constantly learn about new technologies or options that
might benefit them. Be responsive to their needs and proactive in bringing ideas to the
table — gathering and engaging with your customer feedback is the key to customer
retention for any business.

• Offer time-limited promotions

Top ecommerce brands often present banners highlighting a time-limited promotion

— visitors must complete the purchase within a preset amount of time, determined by
the audience segment they belong to. In addition, you can automatically add the
promotional gift card to the visitor’s cart and highlight the promotion during the
checkout process.

The benefit is twofold: the time-sensitive promotion boosts conversion rate and the
gift card brings customers back to the website to make another purchase.

• Be transparent and honest with your customers

As an agency, we don’t hold anything back from our clients and work hard to
establish a relationship built on transparency. Unlike some agencies, we work out of
our client’s ad accounts so they’re always able to look into the work being done and
will always own the data. We also find it important to have healthy, unambiguous
conversations about ideas and strategies brought to the table. For ecommerce brands

20
 this translates to being open and upfront about everything from payment and return
policies to any causes you support through your sales.

• Don’t over-promise

Align expectations with your customers regularly. Keep in mind that they only know
what you tell them. Over-promising and under-delivering is an easy way to lose
credibility. Improving customer trust goes a long way towards getting shoppers to
love your brand — so keep everything from product descriptions to promotional
offers as accurate as possible.

• Create a customer community around your brand

People don’t actually connect with your brand; they connect with the other people that
connect to your brand. Give those people a voice on your website to remind your
guests they aren’t buying a “product” they are buying their way into a community of
like minded people, or people they want to be more like.

• Incentivize social shares

Clients are often high-potential returning buyers who just need a sense of urgency, or
a point of connection to your brand to come back for another round. Social sharing
competitions that feature customer photos and offer great prizes are the perfect way to
establish that connection in a time-sensitive way. But not all incentives are equal.
Some serve as pure retention tools, while others can entice brand ambassadors to do
some word-of-mouth marketing. The latter, who saves on marketing expense down
the road, allows you to justify a more significant reward for your most loyal
customers when they share your brand and products on social. This increases

21
customer engagement, while bringing you high quality traffic that you would work
hard to reach otherwise.

AIMS FOR CUSTOMER RELATIONSHIP MANAGEMENT

CRM is a new technique in marketing where the marketer tries to develop long term
relationship with the customers to develop them as life time customers. CRM aims to
make the customer climb up the ladder of loyalty.

The company first tries to determine who are likely prospects i.e. the people who have
a strong potential interest in the product and ability to pay for it. The company hopes
to convert many of its qualified prospect into first time customers and then to convert
those first time customers into repeat customers. Then the company tries to convert
these repeat customers into clients – they are those people who buy only from the
company in the relevant product categories. The next challenge for the company is to
convert this client into advocates. Advocates are those clients who praise the company
and encourage others to buy from it.

The ultimate challenge is to convert these advocates into partners where the customers
and the clients work actively together to discover ways of getting mutual benefit.

Thus in CRM the key performance figure is not just current market share but share of
life time value by converting customers into partners.

In CRM the company tries to identify that small percentage (20%) of key account
holders whose contribution to the company revenues is high (80%). So from this point
of view, CRM is also known as KEY ACCOUNT MANAGEMENT.

Why – Customer Relationship Management

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• A satisfied customer in 10 years will bring 100 more customers to the company.

• It costs 7 times more to attract a new customer than to serve an old one.

• 20% of the company’s loyal customers account for 80% of its revenues. (Pareto’s
principle).

• The chances of selling to an existing customer are 1 in 2; the chances of selling to a

new customer are 1 in 16.

Eight ways to keep customers for life

• Every part of the company’s marketing effort should be geared towards building
lifetime relationships.

• People want to do business with friendly people. To have effective relations a

friendly attitude must permeate in the organization.

• Information technology developments should be positively used to serve the

customers.

• The company should always be flexible to bend its rules and procedures in the
client’s favor.

• The company should communicate with its customers even when it is not trying to
sell something.

• The company can communicate and develop stronger customer bonding by providing
financial and social benefits.

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• The company should try to know all its customers including their lifestyles, hobbies,
likes and dislikes etc.

• The company should make it a point to deliver more than what is promised.

The Elements of Customer Relationship Management

CRM can be divided not only into different areas, but also into four components, each
used by each department as required. These components are:

• Analytical CRM
• Operational CRM
• Communicational CRM
• Collaborative CRM

The analytical component of CRM is where customer data is collected and evaluated.
CRM software and the options it makes possible play a central role in this function.
What data can your software collect? In what ways can this data then be analyzed and
evaluated? These questions must be taken into consideration when selecting CRM
software because effective customer relationship management cannot be achieved
without reliable data evaluation. Methods borrowed from the field of business
intelligence are used for this purpose, especially data mining – i.e. the systematic
statistical evaluation of large volumes of data. This helps to identify trends and can
verify whether certain measures have been successful while also reporting on whether
there were any (perhaps unexpected) side effects.

The task of operational CRM is to translate the findings of analytical CRM into
concrete measures. Among other things, this includes sorting customers into different
categories. This helps to evaluate the relative importance of each customer to the
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company, the market sector in which the customer is active, whether the customer
could be interested in any other aspects of the market, whether the order potential in
the identified core sector has yet been exhausted, and more. In addition, operational
CRM also gathers further data which, in conjunction with the software, helps to give a
more precise picture of each customer.

Communicational CRM manages various communication channels so that a

coordinated contact with the customer can be maintained. If, for example, a customer
has been contacted via newsletter, this can then be followed up with a personal call.
This coordination of communication methods means the company can build upon the
groundwork performed by each successive measure. In the absence of such
coordination, some of these measures would presumably be in vain, or perhaps even
counterproductive if the customer then feels harassed or poorly looked-after.

Just like communicational CRM, collaborative CRM serves to coordinate. However,

this task is not about coordinating external actions but concerns coordination across
the company. Thanks to CRM software, all departments involved in customer
relationship management work with the same data, but this does not necessarily mean
their efforts are coordinated. Collaborative CRM allows a company-wide approach,
which determines clear goals and responsibilities.

CRM in the Textile industry

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In textile industry one company sell its product to another company. For example a
yarn manufacturing company sells to fabric manufacturing company. A fabric
manufacturing company sells fabric to apparel company. The main customers of the
companies in the textile industry are the wholesalers. And the final product is sold to
the wholesalers and retailers. In this industry the customers are few and profit margins
are high. So CRM is very much necessary and relevant in this industry. There is a
high degree of uncertainty on the part of the buyers; the likelihood of customers
seeking a relationship is increased. If the firm loses its customer it would be major
loss to the firm. The product in the textile industry is complex and quality is an
important factor. One of the major values the customer expects from vendors is
quality. No customer will tolerate average quality. According to GE’s chairman John
“quality is the best assurance of customer allegiance and strongest defense against
competition and the only path to sustained growth and earnings.” If the product is not
of good quality the customer will not be satisfied and the firm may lose its customer.
Moreover there is a scope of customization in the product. The seller has to customize

26
the product according to the need of the customer. Customization is changing the
product according to the need of the customer in order to satisfy him.

How to introduce CRM in the company

There are four key steps for putting one to one marketing program to work –

Step 1: Identify your customers

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To launch a one to one initiative the company must be able to locate and contact a fair
number of customers or at least a substantial portion of its valuable customers. It is
crucial to know the customer details as much as possible, not just their names or
address, but their habits, preferences and so forth.

Step 2: Differentiating your customers

Customers are different in two principal ways; they represent different levels of value
and have different needs. Once the company identifies its customers differentiating
them will help the company to focus its efforts to gain the most advantage with the
most valuable customers.

Step 3: Interacting with the customer

Interaction is also a crucial component of a successful CRM initiative. It is important
to remember that interaction just not occur through marketing and sales channels,
customer interact in many different ways with many different areas of the
organization so to foster relationship all the areas of the organization must be
accessible to the customer.

Step 4: Customize your enterprise’s behavior

Ultimately to lock a customer into a relationship a company must adapt some aspect
of its behavior to meet customer’s individually expressed needs this might mean mass
customizing a manufactured product or it might involve tailoring some aspect of the
service surrounding the product.

Focus of the problem

The textile industry is basically manufacturing based industry. Through this study we
are going to identify the importance of CRM in the textile industry. How it is
benefited from CRM? Is there any relevance of implementing CRM? And what role
does information technology can play in CRM?

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 Objectives of Customer Relationship Management

• To study the current practices of CRM.

• To find out the impact of CRM on the profitability of the organization.

• To study the factors affecting the CRM practices.

• To study the role of information technology in CRM.

FUNCTIONS OF CUSTOMER RELATIONSHIP MANAGEMENT

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 Some of the common Customer Relationship Management functions are:
• Customer service and support
• Sales force automation
• Lead management
• Marketing tools for strategy planning
• Inventory management
• Invoice generation
• Business information analytics
• Customer profile management

Social media and customer networking via blogs and forums

Businesses of all sizes can benefit from a Customer Relationship Management
solution. As customers are the most valued assets of any business, CRM software
implementation at the business workplace would highly enhance business processing
and increase the level of customer satisfaction greatly, thereby increasing productivity
and revenue.

SIGNIFICANT OF CUSTOMER RELATIONSHIP MANAGEMENT

Some of the significant benefits of a CRM are:

• Better alignment towards customer needs
• Customer centric processes to increase customer lifetime value and average revenue
per customer
• Streamlined sales and marketing processes
• Higher sales productivity
• Improved customer satisfaction with higher customer retention and lower acquisition
rates
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• Added cross-selling and up-selling opportunities
• Reduced expenses with better marketing opportunities
• Better customer profiling and targeting
• Higher overall profitability

Research Methodology for CRM

Meeting and satisfying each customer’s need uniquely and individually. In the mass
markets individualized information on customers is now possible at low costs due to
the rapid development in the information technology and due to availability of
scalable data warehouses and data mining products. By using online information and
databases on individual customer interactions, marketers aim to fulfill the unique
needs of each mass-market customer. Information on individual customers is utilized
to develop frequency marketing, interactive marketing, and after marketing programs
in order to develop relationship with high-yielding customers. In the context of
business-to-business markets, individual marketing has been in place of quite some
time. Known as Key Account Management Program, here marketers appoint customer
teams to husband the company resources according to individual customer needs.

Continuity Marketing Programs

Take the shape of membership and loyalty card programs where customers are often
rewarded for their member and loyalty relationships with the marketers. The basic
premise of continuity marketing programs is to retain customers and increase loyalty
through long-term special services that has a potential to increase mutual value
through learning about each other.

Partnering Programs
The third type of CRM programs is partnering relationships between customer and
marketers to serve end user needs. In the mass markets, two types of partnering
programs are most common: Co- branding and affinity partnering.

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The fourth function that often is the source of a competitive edge is that of innovation.
Companies must continually reinvent themselves to deliver an improved and often a
totally new value offering to their customer base. CRM must provide the customer
intelligence that feeds information back into the enterprise’s knowledge management
processes where it can trigger new innovation processes. When CRM is integrated
into the innovation process, significant value can be derived from faster time to
market cycle times and with new processes and services. Marketing automation must
ensure that the innovation processes are actually market driven. A market driven
innovation process must include both strategies that are focused on satisfying
customer requirements as well as strategies focused at redefining customer
requirements. Sales automation should be integrated with the innovation process by
ensuring that all sales channels are prepared and ready to take new processes and
services to market before competitive forces can react. Customer service automation
must be designed to empower the customer with the option of assisting with the
design of the value offering. Redefining CRM around innovation, sales, marketing
and service can identify new competitive opportunities for an enterprise. The
remaining question is whether companies are prepared to take the initiative and
expand the definition of customer relationship management to include the process of
innovation. The pressure to deliver results within the traditional definition of CRM
already overwhelms companies. The dialog must start rather earlier than later because
the competitive window of traditional CRM is decreasing and customer demands for a
more innovative and responsive enterprise will increase.

Architecture of CRM
There are three parts of application architecture of CRM:

Operational - automation to the basic business processes (marketing, sales, service).

Analytical - support to analyze customer behavior, implements business intelligence
alike technology.
Collaborative - ensures the contact with customers (phone, email, fax, web, SMS,
post, in person).

32
• Operational CRM
Operational CRM means supporting the "front office" business processes, which
include customer contact (sales, marketing and service). Tasks resulting from these
processes are forwarded to resources responsible for them, as well as the information
necessary for carrying out the tasks and interfaces to back-end applications are being
provided and activities with customers are being documented for further reference.
Operational CRM provides the following benefits:
• Delivers personalized and efficient marketing, sales, and service through multi-
channel collaboration
• Enables a 360-degree view of your customer while you are interacting with them
• Sales people and service engineers can access complete history of all customer
interaction with your company, regardless of the touch point. The operational part of
CRM typically involves three general areas of business:

• Sales force automation (SFA)

SFA automates some of the company's critical sales and sales force management
functions, for example, lead/account management, contact management, quote
management, forecasting, sales administration, keeping track of customer preferences,
buying habits, and demographics, as well as performance management. SFA tools are
designed to improve field sales productivity. Key infrastructure requirements of SFA
are mobile synchronization and integrated product configuration.

Missing process of CRM

Traditionally customer relationship management (CRM) revolves around the three
functions of selling, marketing and support. Various process models have been built
around how these functions are integrated and operated in a customer oriented
enterprise. There is however a fourth critical function that is lacking in most
Commodes.

• Customer service and support (CSS)

CSS automates some service requests, complaints, product returns, and information
requests. Traditional internal help desk and traditional inbound call-center support for
33
 customer inquiries are now evolved into the "customer interaction center" (CIC),
using multiple channels (Web, phone/fax, face-to-face, kiosk, etc). Key infrastructure
requirements of CSS include computer telephony integration (CTI) which provides
high volume processing capability, and reliability.

• Enterprise marketing automation (EMA)

EMA provides information about the business environment, including competitors,
industry trends, and macro-environmental variables. It is the execution side of
campaign and lead management. The intent of EMA applications is to improve
marketing campaign efficiencies. Functions include demographic analysis, variable
segmentation, and predictive modeling occurs on the analytical (Business
Intelligence) side. Integrated CRM software is often also known as "front office
solutions." This is because they deal directly with the customer. Many call centers use
CRM software to store all of their customer's details. When a customer calls, the
system can be used to retrieve and store information relevant to the customer. By
serving the customer quickly and efficiently, and also keeping all information of a
customer in one place, a company aims to make cost savings, and also encourage new
customers.CRM solutions can also be used to allow customers to perform their own
service via a variety of communication channels. For example, you might be able to
check your bank balance via your Earphone without ever having to talk to a person,
saving money for the company, and saving your time.

• Analytical CRM
In analytical CRM, data gathered within operational CRMand/or other sources are
analyzed to segment customers or to identify potential to enhance client relationship.
Customer analysis typically can lead to targeted campaigns to increase share of
customer's wallet.Examples of Campaigns directed towards customers are:

• Acquisition: Cross-sell, up-sell

• Retention: Retaining customers who leave due to maturity orattrition.
• Information: Providing timely and regular information to customers.

34
• Modification: Altering details of the transactional nature of thecustomers'
relationship.
• Analysis typically covers but is not limited to:
• Decision support: Dashboards, reporting, metrics, performanceetc.
• Predictive modeling of customer attributes
• Strategy and Research Analysis of Customer data may relate toone or more of the
following analyses:
• Contact channel optimization
• Contact Optimization
• Customer Acquisition / Reactivation / Retention
• Customer Segmentation
• Customer Satisfaction Measurement / Increase
• Sales Coverage Optimization
• Fraud Detection and analysis
• Financial Forecasts
• Pricing Optimization
• Product Development
• Program Evaluation

Risk Assessment and ManagementData collection and analysis is viewed as a

continuing anditerative process. Ideally, business decisions are refined over time,
based on feedback from earlier analysis and decisions. Therefore,most successful
analytical CRM projects take advantage of a data warehouse to provide suitable data.
Business Intelligence is a relateddiscipline offering some more functionality as
separate applicationsoftware.

• Collaborative CRM
Collaborative CRM facilitates interactions with customersthrough all channels
(personal, letter, fax, phone, web, e-mail) andsupports co-ordination of employee
teams and channels. It is asolution that brings people, processes and data together so
companiescan better serve and retain their customers. The data/activities can
bestructured, unstructured, conversational and/or transactional innature.Collaborative
CRM provides the following benefits:
35
• Enable efficient productive customer interactions across allcommunications channels

• Enables web collaboration to reduce customer service costs

• Integrates call centers enabling multi-channel personalcustomer interaction

• Integrates view of the customer while interaction at thetransaction level

Analysis

The customers of the COMPANY are the wholesalers. It is because the number of
retailers is very large as compared to the wholesalers. So it is not possible for the
company to approach to the retailers. Therefore the company sells to the wholesalers
and then wholesalers sell to the retailers.

Customers are encouraged to give suggestions and complaints so that the company
can improve its working and services. If the customer’s complaints are not resolved
the customers will be dissatisfied and the company may lose its customers.

Different customers have different requirements. So the company customize its

product accordingly to satisfy the customers. It also gives more choice to the
customers.

To get the information about the customers and to measure the satisfaction the
company conducts surveys. Because of the expertise needed in the research the
company give this work to research agencies like AC NILSON.

The company gives credit facility to its customers to increase the sales volume. If the
company do not sell on credit the customers may switch over to other companies.

The company maintains frequent communication with the customers. As soon as the
product is ready or a new product is launched the information is provided to the
36
customers. Communication is also necessary to maintain the interest of the customers
in the company.

The company gives concession to its regular customers so as to retain its most
valuable and profitable customers.

The company regularly reviews the business process in order to eliminate non value-
adding activities, to reduce the cost and to make the whole work efficient and
effective. If the internal customers are not satisfied and there is lack of coordination
among the departments then it will affect the external customers also.

COMPANY PROFILE

37
Type : Private

Industry : Finance

Founded In : 1983

Headquarters : Hyderabad, Telangana, India

Area served : Worldwide

Website : www.karvi.com

Karvy is a financial services company headquartered in Hyderabad, India. Karvy

Group is one of the leading financial services conglomerate. Headquartered in
Hyderabad, it offers a range of financial services including stock broking, distribution
of financial products, depository participant, commodities broking, wealth
management, and more. It is ranked among the top five in the country across its
business segments. Other than India, it also has a presence in Bahrain, Dubai,
Malaysia, Philippines and the United States.

Karvy Group services over 70 million investors and offers various investor services to
more than 600 corporate houses, including the best of Corporate India. Being one of
the leading financial service providers, Karvy Group provides various financial
services including corporate finance, insurance broking, investment banking, NBFC
(loans to individuals, micro and small businesses), among others.
In its bid to tap the ever growing online buying segment, Karvy Group has recently
forayed into eCommerce enabler business. The initiative named as Karvyclick.com

38
will aid small and medium enterprises to go online for selling their products in various
eCommerce platforms.

After foraying into eCommerce enabler business in 2017, Karvy Group plans to
generate Rs 100 crore of revenue in next two years. It will also raise its headcount as
the company plans to expand its footprints in more cities in coming years.

Karvy Data Management Services, a subsidiary of Karvy Group, has acquired the call
centre business of Media Matrix Worldwide Ltd for Rs 30 crore last year.

39
Karvy Private Wealth, the wealth management arm of Karvy Group, comes out with a
report named ‘India Wealth Report’ every year. The report depicts the savings and
investment patterns of Indian investors and provides possible future patterns.
According to the recent wealth report of the company, financial assets are attracting
more household savings in India compared to physical assets.

Domestic demand will be the key growth driver for Indian economy, Chief Executive
Officer of Karvy Private Wealth, Abhijit Bhave said. Equity as an asset class will
outperform all other asset classes in the next 3 to 5 years and retail investors are better
off investing in equities through mutual fund route, he said. For tax savings purposes,
Equity Linked Savings Scheme (ELSS) should be looked with a medium to long-term
outlook, Bhave said.

Karvy Stock Broking Limited provides stock broking and research advisory services
in India. The company offers portfolio analysis, depository participant, and financial
planning and management services for individuals and institutional clients. It also
provides a monthly magazine, Finapolis, which provides up-dated market information
on market trends, investment options, and opinion. Karvy Stock Broking Limited
operates as a subsidiary of Karvy Consultants Limited.

HISTORY of KARVI STOCK BROKING LTD.

Karvy was established in the year 1983 and is now headed by Mr. C Parthasarathy as
Chairman.The group has more than 30,000 employees, spanning 900 offices in about
400 cities and towns. In the mid-1990s, Karvy forayed into stockbroking and advisory
businesses. Later, in the early 2000s, Karvy Corporate ventured into commodity
trading. With the introduction of currency trading, Karvy corporate is also in the
business of Forex trading. In September 2008, the group launched an online trading
and investment portal offering an extensive range of financial products and solutions
across different classes.

Karvy Consultants Limited was established in 1982 at Hydrabad. It was established

by a group of Hydrabad-based practicing Chartered Accountants. At initial stage it
was very small in size. It was started with a capital of Rs. 1,50,000.
40
In starting it was only offering auditing and taxation services. Later, it acts into the
Registrar and Share transfer activities and subsequently into financial services and
other services like Financial Product Distribution, Investment Advisory Services,
Demat Services, Corporate Finance, Insurance etc.

All along, Karvy’s strong work ethics and professional background leveraged with
Information Technology enabled it to deliver quality to the individual. A decade of
commitment, professional integrity and vision helped Karvy achieving a leadership
position in its field when it handled largest number of corporate and retail that proved
to be a sound business synergy.

Today, Karvy has access to millions of Indian shareholders, besides companies,

banks, financial institutions and regulatory agencies. Over the past one and half
decades, Karvy has evolved as a veritable link between industry, finance and people.

In January 1998, Karvy became first Depository Participant in Andhra Pradesh. An

ISO 9002 Company, Karvy’s commitment to quality and retail reach has made it an
Integrated Financial Services Company.

Today, company has 230 branch offices in 164 cities all over the India. The company
adds 5 new offices every month to the company’s ever growing national network in
every nook and corner of the country. The company service over 16 million individual
investors, 180 corporate and handle corporate disbursements that exceed Rs.2500
Crores.

WHERE KARVY STAND IN THE MARKET?

KARVY is a legendary name in financial services, Karvy’s credit is defined by its

mission to succeed, passion for professionalism, excellent work ethics and customer
centric values.

41
 Today KARVY is well known as a premier financial services enterprise, offering a
broad spectrum of customized services to its clients, both corporate and retail.
Services that KARVY constantly upgrade and improve are because of company’s
skill in leveraging technology. Being one of the most techno-savvy organizations
around helps company to deliver even more cost effective financial solutions in the
shortest possible time.

What bears ample testimony to Karvy’s success is the faith reposed in company by
valued investors and customers, all across the country. Indeed, with Karvy’s wide
network touching every corner of the country, even the most remote investor can
easily access Karvy’s services and benefit from company’s expert advice.

KARVY GROUP
• Karvy Consultants Limited
• Karvy Investor Services Limited
• Karvy Stock broking Limited
• Karvy Computer Shares Pvt. Ltd.
• Karvy realty (India) Pvt Ltd
• Karvy globle services Ltd
• Karvy data base management services
• Karvy comtrade Ltd
• Karvy Consultants Limited

As the flagship company of the KARVY Group, KARVY Consultants Limited has
always remained at the helm of organizational affairs, pioneering business policies,
work ethic and channels of progress. Having emerged as a leader in the registry
business, the first of the businesses that we ventured into, we have now transferred
this business into a joint venture with Computershare Limited of Australia, the
world’s largest registrar. With the advent of depositories in the Indian capital market
and the relationships that we have created in the registry business, we believe that we
were best positioned to venture into this activity as a Depository Participant. We were
one of the early entrants registered as Depository Participant with NSDL (National
Securities Depository Limited), the first Depository in the country and then with
CDSL (Central Depository Services Limited). Today, we service over seven lakh
42
 customer accounts in this business spread across over 540 cities/towns in India and
are ranked amongst the largest Depository Participants in the country. With a growing
secondary market presence, we have transferred this business to KARVY Stock
Broking Limited (KSBL), our associate and a member of NSE, BSE and HSE.

KARVY Stock Broking Limited

KARVY Stock Broking Limited, one of the cornerstones of the KARVY edifice,
flows freely towards attaining diverse goals of the customer through varied services.
It creates a plethora of opportunities for the customer by opening up investment vistas
backed by research-based advisory services. Here, growth knows no limits and
success recognizes no boundaries. Helping the customer create waves in his portfolio
and empowering the investor completely is the ultimate goal. KARVY Stock Broking
Limited is a member of:
• National Stock Exchange (NSE)
• Bombay Stock Exchange (BSE)
• Hyderabad Stock Exchange (HSE)

KARVY Investor Services Limited

Deepening of the Financial Markets and an ever-increasing sophistication in corporate
transactions, has made the role of Investment Bankers indispensable to organizations
seeking professional expertise and counselling, in raising financial resources through
capital market apart from Capital and Corporate Restructuring, Mergers &
Acquisitions, Project Advisory and the entire gamut of Financial Market activities.
Karvy Investor Services Limited (‘KISL’), a SEBI registered Merchant Banker has
emerged as a leading Investment Banking entity in the country with over a decade of
experience. KISL has built its reputation by capitalizing on its qualified professionals,
who have successfully executed a large number of complex and unique transactions.
Our quality professional team and our work-oriented dedication have propelled us to
offer value-added corporate financial services and act as a professional navigator for
long term growth of our clients, who include leading corporates, State Governments,
Foreign Institutional Investors, public and private sector companies and banks, in
Indian and global markets.

43
 We have also emerged as a trailblazer in the arena of relationships, both at the
customer and trade levels because of our unshakable integrity, seamless service and
innovative solutions that are tuned to meet varied needs. Our team of committed
industry specialists, having extensive experience in capital markets, further nurtures
this relationship.
Credentials
• Emerging as a leading Investment Banker with a strong support from its Group
entities in Research, Stock Broking, Institutional Sales and Retail Distribution.
• Strong team of more than 25 qualified professionals operating from six cities;
Hyderabad, Mumbai, Delhi, Kolkata, Chennai, and Bangalore apart from two
overseas offices at New York (USA) and Dubai.
• One of the largest retail distribution networks with over 584 branches in over 389
cities/towns.
• Excellent Institutional Sales D

KARVY Computer Shares Pvt. Ltd.

Karvy Computershare Private Limited is a joint venture between Computershare,
Australia and Karvy Consultants Limited, India in the registry management services
industry.
Computershare, Australia is the world’s largest and only global share registry
providing financial market services and technology to the global securities industry.

KARVY realty (india) pvt ltd

Karvy Realty (India) Limited (KRIL) is promoted by the Karvy Group, India’s largest
financial services group. The group carries forward its legacy of trust and excellence
in investor and customer services delivered with passion and the highest level of
quality that align with global standards.
Karvy Realty (India) Limited is engaged in the business of real estate and property
services offering:
• Buying/ selling/ renting of properties
• Identifying valuable investments opportunities in the real estate sector
• Facilitating financial support for real estate and investments in properties
• Real estate portfolio advisory services.

44
 KRIL is your personal real estate advisor guiding and hand holding you through real
estate transactions and offering valuable investment opportunities.
Building on the KARVY brand as a leading industry benchmark for world class
customer servicing and quality standards, KRIL brings to investors a reputation of
reliability, dependability and honesty. Our understanding of the needs and preferences
of our clients and our teams of qualified realty professionals help us to establish
fruitful relationships with buyers and sellers of properties alike.
A single stop shop for realty services offering:
• Transacting Options: Choose to buy, sell or rent properties (residential and
commercial)
• Investing Options: Give your investments a good opportunity with properties
marketed by KRIL.
• Financing Options: Get unmatched deals for financing your investment
• Research Options: We undertake valuation and feasibility studies, area analysis and
customized analysis on behalf of clients.

KRIL has ongoing relations with builders and developers across the country which
will help you place your investments in the most genuine properties for a good value
appreciation at the right place and at the right price.
KRIL is committed to the guiding principles of quality, timely service delivery, fair
pricing, transparency and integrity.

KARVY globle servieses Ltd

Karvy Global is pioneering the creative business solutions approach to transform
information into insight aimed to address the business, marketing and operational
intelligence needs of global companies.

KARVY data base management services

KDMSL is emerging as a leading service provider in the areas of E-governance
processing, insurance back office processing, record keeping, back office for BFSI
clientele and is in pursuit to establish credentials in the areas of Telecom processing,
Data management requirements of large corporates. KDMSL is striving to achieve
leadership position by tapping the Indian retail sector boom, through a combination of
45
our extensive branch network and proprietary IT backbone. Needless to say, KDMSL
is run as an independent outfit with seasoned professionals on board, who have
decades of expertise in the industry.KDMSL is a fully owned subsidiary of Karvy
Stock Broking Limited (KSBL), incorporated in April 2008 and is head quartered at
Hyderabad.

KARVY comtrade Ltd

Commodities market, contrary to the beliefs of many people, has been in existence in
India through the ages. However the recent attempt by the Government to permit
Multi-commodity National levels exchanges has indeed given it, a shot in the arm. As
a result two exchanges Multi Commodity Exchange (MCX) and National Commodity
and derivatives Exchange (NCDEX) have come into being. These exchanges, by
virtue of their high profile promoters and stakeholders, bundle in themselves, online
trading facilities, robust surveillance measures and a hassle-free settlement system.
The futures contracts available on a wide spectrum of commodities like Gold, Silver,
Cotton, Steel, Soya oil, Soya beans, Wheat, Sugar, Chana etc., provide excellent
opportunities for hedging the risks of the farmers, importers, exporters, traders and
large scale consumers. They also make open an avenue for quality investments in
precious metals. The commodities market, as it is not affected by the movements of
the stock market or debt market provides tremendous opportunities for better
diversification of risk. Realizing this fact, even mutual funds are contemplating of
entering into this market.
Karvy Comtrade Limited is another venture of the prestigious Karvy group. With our
well established presence in the multifarious facets of the modern Financial services
industry from stock broking to registry services, it is indeed a pleasure for us to make
foray into the commodities derivatives market which opens yet another door for us to
deliver our service to our beloved customers and the investor public at large.
With the high quality infrastructure already in place and a committed Government
providing continuous impetus, it is the responsibility of us, the intermediaries to
deliver these benefits at the door-steps of our esteemed customers. With our expertise
in financial services, existence across the lengths and breadths of the country and an
enviable technological edge, we are all set to bring to you, the pleasure of investing in
this burgeoning market, which can touch upon the lives of a vast majority of the

46
 population from the farmer to the corporate alike. We are confident that the
commodity futures can be a good value addition to your portfolio.
The company provides investment, advisory and brokerage services in Indian
Commodities Markets. And most importantly, we offer a wide reach through our
branch network of over 225 branches located across 180 cities.

Board of Directors
• Parthasarathy C
• Yugandhar M
• Ramakrishna M S
• Prasad V Potluri
• Robert Gibson
• Sanjay Kumar Dhir
• R Shyamsunder

KARVY Investor Services Limited

• Parthasarathy C
• Yugandhar M
• Ramakrishna M S

KARVY Securities Limited

• Parthasarathy C
• Yugandhar M
• Ramakrishna M S
• Ajay Kumar K
• William Samuel
• Nicholas Tully

KARVY Stock Broking Limited

• Parthasarathy C
• Yugandhar M
47
• Ramakrishna M S
• Ajay Kumar K
• Kutumba Rao V
• William Samuel
• Nicholas Tully

MISSION
An organization exists to accomplish something or achieve something. The mission
statement indicates what an organization wants to achieve. The mission statement
may be changed periodically to take advantage of new opportunities or respond to
new market conditions.
Karvy’s mission statement is “To Bring Industry, Finance and People together”.
Karvy is work as intermediary between industry and people. Karvy work as
investment advisor and helps people to invest their money same way Karvy helps
industry in achieving finance from people by issuing shares, debentures, bonds,
mutual funds, fixed deposits etc.

Company’s mission statement is clear and thoughtful which guide geographically

dispersed employees to work independently yet collectively towards achieving the
organization’s goals.

VISION OF KARVY STOCK BROKING LTD.

Company’s vision is crystal clear and mind frame very directed. “To be pioneering
financial services company. And continue to grow at a healthy pace, year after
year, decade after decade”. Company’s foray into IT-enabled services and internet
business has provided an opportunity to explore new frontiers and business solutions.
To build a corporate that sets benchmarks for others to follow.

AWARDS

Chairman of the diversified financial services group- Karvy, C Parthasarathy has

bagged the ‘Entrepreneur of the Year’[10] award from the Telangana government

48
 for 2017. The award was given for his contribution to IT sector in the state apart from
employment generation.

2016
Karvy Comtrade Limited received “Market Excellence Award, Commodities -
Metal” at the Zee Market Excellence Awards 2016.
The SKOCH – BSE Order of Merit award and the SKOCH – BSE Aspiring Nation
award for KSBL’s efforts to educate, empower and help create an enlightened corps
of financial market investors.
2014
KSBL won the "NSDL Star Performer Award 2014 for Highest Asset Value" the
third time consecutively.

Karvy Comtrade Limited won the prestigious ZEE Business Award for the "Best
Agricultural Analyst" in the fifth edition of India’s Best Market Analyst.
2011
Karvy Comtrade also bagged the ‘Broker with Best Corporate Desk for
Commodity Broking’ award at the Bloomberg UTV Financial Leadership Awards
2011.
2010
KSBL won an award for being the ‘Largest E-Broking House in India’ by Karvy
Stock Broking Limited at the prestigious Dun & Bradstreet – BSE Equity Broking
Awards 2010.

BUSINESS SEGMENT

• Stock broking
• Demat services
• Investment product distribution
• Investment advisory services
• Corporate finance & Merchant banking
• Insurance
• Mutual fund services
• IT enabled services
49
• Registrars & Transfer agents
• Loans
1. Stock Broking:
KARVY is working as Capital Market Intermediaries. Stockbrokers are regulated by
SEBI [Stock-brokers and Sub-brokers] Regulations, 1992. The stockbroker is a
member of the stock exchange. Stockbrokers are the intermediaries who are allowed
to trade in securities on the exchange of which they are members. They buy and sell
on their own behalf as well as on behalf of their clients.
Stockbrokers expand their business by engaging sub-broker. Sub-brokers mean “any
person not being a member of a stock exchange who acts on behalf of a stock broker
as an agent or otherwise for assisting the investors in buying, selling or dealing in
securities through such stock-brokers.”

2. Demat Services:
Karvy is a depository participant with the National Securities Depository Limited
(NSDL) for trading and settlement of dematerialized shares.
Depository Participants (DPs) are described as an agent of the depository. They are
intermediaries between the depository and the investors. The relationship between the
DPs and the depository is governed by an agreement made between the two under
Depositories Act.
A DP can offer depository-related services only after obtaining a certificate of
registration from SEBI.
Since Karvy is also in the broking business, investors who use Karvy’s depository
services get a dual benefit. They can use Karvy’s brokerage
services to execute transactions and Karvy’s depository services to settle them.

3. Investment Products Distribution:

Company is also concern with the distribution of investment products like
(a). Fixed Deposit
(b). Bonds
(c). IPO

50
• Fixed Deposit:
KARVY is dealer of 34 fixed deposits of various types which includes fixed deposits
of Public Sector, Non Banking Finance Companies, Housing Finance Companies and
Manufacturing Companies.

Company is dealer of following Fixed Deposits

PUBLIC SECTOR
Sl. No. Company Name
1. HUDCO
2. Sardar Sarovar Narmada Nigam Ltd.
3. Tamilnadu Power Finance Corporation Ltd.
4. NTPC
[Table5: Public Sector FD with which Karvy deals]
NON BANKING FINANCE COMPANIES
Sl. No. Company Name
1. Ashok Leyland Finance Ltd.
2. Bajaj Auto Finance Ltd.
3. Birla Home Finance Ltd.
4. Cholamandalam Investment & Finance Co. Ltd.
5. Escorts Finance Ltd.
6. First Leasing Company of India Ltd.
7. IDBI Suvidha
8. Nicco Uco Alliance Credit Ltd.
[Table6: FD of Non Banking Finance Companies with which Karvy deals]

HOUSING FINANCE COMPANIES

Sl. No. Company Name
1 Can Fin Homes Ltd.
2 Dewan Housing Finance Corporation Ltd.
51
 3 Gruh Finance Ltd.
4 HDFC Ltd.
5 PNB Housing Finance Ltd.
6 Sundaram Home Finance Ltd.
[Table7: FD of Housing Finance Companies with which Karvy deals]

MANUFACTURING COMPANIES
Sl. No. Company Name
1. A P Paper Mills Ltd.
2. Amtek India Ltd.
3. Atul Ltd.
4. Ballarpur Industries Ltd.
5. Chambal Fertilizers & Chemicals Ltd.
6. Escort Ltd.
7. Greaves Ltd.
8. Gujarat Alkalies & Chemicals Ltd.
9. Indian Express
10. Ind-Swift Ltd.
11. JK Industries Ltd.
12. Jindal Steel & Power Ltd.
13. Sound Craft Industries Ltd.
14. Supreme Industries Ltd.
15. Zuari Industries Ltd.
[Table8: FD of Manufacturing Companies with which Karvy deals]

• Bonds:
Karvy is dealer of following bonds
RBI Saving Bonds
NHB
REC

• IPO:

52
Company is also provides services related to Initial Public Offer of company.
Company provides stationary at the time of IPO as well as provides information to
investors regarding IPO and solves their queries.

4. Investment Advisory Services:

This division provides portfolio management services to high net-worth individuals
and corporate. The expertise of Karvy in research and stock broking gives it the right
perspective to provide investment advisory services. Company provides advisory
services to its clients.

Financial goal of each individual investor varies according to his dream, ambition and
family size and future financial planning for the children & old age pension for self
and wife so does the pathway to achieve it. Karvy apply the principles of Financial
Planning as both science & art, it understands the time horizon, risk bearing capacity
and investment goals of investors keeping in mind their psyche and financial needs.
Based upon this Karvy helps individual investors to plan their entire life up to
retirement, Taxes, Insurance needs and other important personal financial goals. It
designs portfolio for investor to invest their saving in various financial products like
shares, bonds, debentures, mutual funds, fixed deposits, insurance etc., Company
design portfolio by considering following factors.

Investor’s requirement of getting money back,

Investor’s willingness to take risk,
Investor’s tax planning etc.

5. Corporate finance & Merchant banking:

Corporate finance is the financial activity of corporation. It deals with the firm's
operations with regard to investing and financing. It concerned with how firms raise
capital and the consequences of alternative methods of raising capital. Firm’s capital
can be raised by raising loans, issuing shares, and acquiring or merging with other
businesses by public or private companies.
Merchant banking is a financial intermediation that matches entities that need capital
and those that have capital. Hence they facilitate the flow of capital in the market.
53
 Karvy enjoys SEBI category (I) authorization for Merchant Banking. Karvy offers the
full spectrum of Merchant Banking Services, beginning from identifying the best time
for an issue to final stage of marketing it, to harvest unparalleled success.
As a merchant banker Karvy offer following services:
• Issue management
• Instrument designing
• Pricing of the issue
• Registration process for the issue of shares
• Marketing efforts
• Final allotment to investors
• Listing details on stock exchanges
• Loan syndication
• Lease financing
• Corporate advisory services
• Underwriting
• Portfolio management

6. Insurance:

Karvy is also dealer of many private life insurance companies. At Jamnagar branch,
company is associated with dealing of following companies.
ICICI Prudential Life Insurance
HDFC Life Insurance
TATA AIG Life Insurance

7. Mutual Fund Services:

Since its inception in 1982, Karvy has demonstrated a dedication coupled with
dynamism that has inspired trust from various segments – corporate, government
bodies and individuals. Karvy has since been performing a pivotal role as the
intermediary – the interface – between these players.
With Mutual Funds emerging as a distinct asset class, Karvy has made a strategic
choice to leverage the power of latest technology to provide a cutting edge to its
services. Karvy, today, service nearly 80% of the asset management companies

54
 (AMCs) across an extensive network of service centers with assets under service in
excess of Rs.10,000 crores.
Karvy's ability to mass customize and offer a diverse range of products for a diverse
range of customers has helped mutual fund companies to uniquely position
themselves in the market place. These diverse range of services cut across multiple
delivery channels – service centers, web, mobile phones, call center – has brought
home the benefits of technology to investors, distributors, and the mutual funds.
Going forward, Karvy shall strive to create new products and services, which would
address the needs of the end customer. Company’s single minded focus in delivering
products for customers has given it the distinguished position of being the preferred
provider of financial services in the country.

List of Mutual Fund Clients of KARVY:

• Axis Mutual Fund
• Baroda Pioneer Mutual Fund
• BOI AXA Mutual Fund
• Canara Robeco Mutual Fund
• DHFL Pramerica Mutual Fund
• Edelweiss Mutual Fund
• Essel Mutual Fund
• IDBI Mutual Fund
• India Bulls Mutual Fund
• INVESCO Mutual Fund
• JM Financial Mutual Fund
• LIC Mutual Fund
• Mirae Asset Mutual Fund
• Motilal Oswal Mutual Fund
• Principal Mutual Fund
• Quantum Mutual Fund
• Reliance Mutual Fund
• Taurus Mutual Fund
• UTI Mutual Fund

8. Income Tax enabled services:

55
 Karvy has been started this service since March, 2004. Karvy is work as TIN
Facilitation Centre it provides following IT enabled services.
a. Distribution of PAN Card.
b. Distribution of TAN Card.
c. Services related to e-TDS.
Karvy work as an intermediary between NSDL and IT payers. Karvy provides various
form for different IT enabled services and guide people to fill that forms. It also
solves queries of the tax payers. It also distributes PAN and TAN card to the tax
payers.

9. Registrars & Transfer agents:

In 1985, Karvy entered the Registrar and Share Transfer Business to create a market
niche in the competitive field of financial services. In 1994-95, it reached a milestone
when it processed 104 Public Issues constituting 46 per cent market share. Now in its
second decade of existence, Karvy is the leader in the industry: In an opinion poll
conducted by an independent market research agency - MARG, Karvy has been rated
as India’s Most Admired Registrar on various parameters: -
Overall Excellence.
Handling of Volumes
Timely Dispatch
Quality Management and Technological Up gradation.
A SEBI Category 1 Registrar, So far, Karvy has handled over 675 ISSUES as
Registrars to public issues processed over 52 million applications and is servicing
over 16 million investors from various locations spread over 205 clients.

10. Loan:
Karvy has recently started this service at selected branches of metro cities. This
service has not been started in Saurashtra-Kucch region. Karvy provides loans for
following.

• Vehicle Loan
• Home Loan
• Personal Loan

56
 PRODUCT
OF
KARVI STOCK
BROKING
LTD

PRODUCT OF KARVY STOCK BROKING LTD

Karvy Stock Broking Ltd is group company of Karvy Group which was incorporated
in 1982, is providing financial services like equity broking, depository participant,
distribution of mutual funds, FD, Bonds, wealth management service, currency
derivatives, portfolio management services. Their online real-time platform provides
custom to trade in NSE and BSE, Investment option in equity cash, derivatives,
currency, Mutual Funds, NCD’s, Bonds, Corporate FDs.

Karvy Comtrade Ltd is also part of karvy Group and providing commodities trading
facility.

Karvy Capital Ltd is providing services like NBFC and Portfolio management.

So in other words Karvy Group is majorly divided in two business segments –

Financial Services and Non Financial Services.

Karvy Financial services

Karvy Equity Broking
Karvy Stock Broking Ltd offer online trading on key exchanges — NSE (National
Stock Exchange) and BSE (Bombay Stock Exchange). Key important points trading
with Karvy are they make trading safe to the maximum possible extent by accounting
for several risk factors and planning accordingly. They have created a very robust

57
trading platform that facilitates customers to trade online not only in equities, but also
buy fixed deposits, mutual funds, commodities, currencies and also participate in a
public issue. Karvy's online platform enables customers to view their portfolio online
and also access various research reports and views on stocks. It also provides them
with a facility to communicate with Karvy’s research/advisory teams online. So in
summary strong trading platform and strong research reports are key benefit of
Karvy's Stock Broking Ltd.

Karvy Depository Participant

Karvy is providing Demat facility, KSBL [Karvy Stocking Broking Ltd] is member
of NSDL and CSDL for Demat service. Karvy started membership with NSDL and
CSDL in 1998 and emerged as one of the top-3 depository participants in India, in
terms of customers serviced.

Karvy Wealth Management

Karvy is offering comprehensive wealth management solutions for its customers
through Karvy Private Wealth (KPW) or karvywealth.com.

Karvy wealth managers provide direction to a client’s financial decisions, enabling

him achieve his financial and life goals. As a wealth manager, we collate the relevant
financial information and life goals of the client, assess his risk tolerance level,
examine his current financial status, and identify a strategy to fulfill his goals.

KWM is a research based advisory service to fulfill client’s desired goals. In KPW
clients are offers to invest in product basket, ranging from debt, equity, mutual funds,
insurance, derivatives, commodities, structured products, international funds, art
funds and real estate.

KPW was set up to cater to HNIs, keeping in mind that they require a different kind of
financial planning and management. Karvy Private Wealth services include planning
of business and retirement needs, planning and protection of finances, and a host of
other services, which will help augment clients existing as well as future finances and
lifestyle.

58
 KWM also provide online portfolio management, constant updates on client’s
portfolios as well as value-added advice on portfolio churning, sector switches, etc.

Karvy Commodities Broking

Karvy Comtrade Limited (KCTL) or karvycommodities.com is India’s leading
commodities trading house. Karvy started providing commodity trading in the early
phase when Indian market was adopting commodities trading, so strong business
presence as well as award winning research service. KCTL have presence in
wholesale markets where the commodities are auctioned purely to get a complete
sense on the demand supply for most of the agricultural products. Karvy Comtrade
Limited is having membership with below given commodity exchanges:
• Multi Commodity Exchange of India (MCX)
• National Commodity and Derivatives Exchange (NCDEX)
• National Multi-Commodity Exchange of India (NMCE)
• National Spot Exchange (NSEL)
• NCDEX Spot Exchange (NSPOT)
• Ace Commodity Exchange (ACE)
• Indian Commodity Exchange (ICEX)

Karvy Currency Derivatives Trading

Currency derivative are part of Karvy Stock Broking Limited, where Kary specilized
research team provide customized hedging strategies for importers, exporters and
companies with foreign exchange exposure. Karvy Currency Derivatives Segment is
active member of:
• National Stock Exchange (NSE)
• Metropolitan Stock Exchange of India (MSEI)
• Bombay Stock Exchange (BSE)

Karvy Non- Financial Services

Incorporated in 2009, Karvy Finance is part of Karvy groups, providing Non-banking

Financial Services (NBFC) like personal loans, business loans, loans against security
and so on. Primary focus of Karvy Finance is on micro & small enterprise secured

59
business loans with loan against property, loan against gold and loan for small
commercial vehicles.

Karvy Distribution of Financial Products- Mutual Funds Investment

Karvy Stock Broking Ltd, provide investment options in Mutual Funds, National
Pension System (NPS), Corporate Fixed Deposits, Capital Gain Bonds and many
more. Advance research and customized solution for investment is also provided by
Karvy.

Karvy Registry services for Corporate and Mutual funds

Karvy Computershare is joint venture between Karvy and Australia-based
Computershare. The Company core business include Issue registrar, Corporate
Shareholder Services and Mutual Fund Services.

Karvy Research report

Karvy as stock broker is having strong hold in market. Daily market summary in
morning and evening, weekly, monthly and long term investment research reports are
available for register users. Research reports are also available for commodity trading,
Mutual Funds.

Karvy Margin Funding

Karvy as stock broker provide margin funding to his investors. Margin against shares
option is lso available to get margin on your long term holdings.

Karvy NRI Trading Services

Invest in Equities, Initial Public Offerings, ETFs, Mutual Funds and Futures &
Options with Karvy NRI trading account. Karvy providing end to end solution for
NRI by opening NRI Trading account, NRI Demat account, NRI Bank account,
Assisted Trading, PAN Card Service and many more.

Karvy Priority Account

Karvy Priority Account is specially planned account for High Net worth Individuals
(HNIs) and Corporate. This service include stock recommendations to exclusive trade
reports, from various trading options available to personalized portfolio management,
60
 Knowledgeable Support by research experts, personalized guidance by dedicated
relationship managers and equity advisors, live chat, investor awareness programs,
skype sessions and many more. Minimum requirement for Karvy Priority account is
maintain initial margin amount of Rs. 5 Lac and above.

Karvy IPO Investment

Investment in IPO is applicable via ASBA process via giving karvy demat account
details.

• Insurance Repository
• The Finapolis
• Forex & Currencies

Key Services of Karvy Non-Financial entities are:

• Data Management Services
• International BPO
• Alternate Energy
• Data Analytics
• Market Research
Karvy commonly misspelled as "Karvi", "carvi".

Karvy Branches
www.karvyonline.com is an online investment website of Karvy. Karvy offers most
of its customer services through its website only.

They also offer customer service though branches which are located around the
country in almost all major cities in India.

Customer could visit any local Karvy branch and ask for help related to Karvy
Trading & Demat account, Karvy Commodity account, Karvy Mutual Fund account.
If the branch doesn’t exist in your city, still you can open account with Karvy and
start your investment via online trading platform and call n trade service.

Karvy Branch Locator / Sub Broker

61
 Karvy website provide the branch locator under customer service section. This locator
can be used to locate the branch nearby you.

• karvy ahmedabad
• karvy bhubaneswar
• karvy branches
• karvy chandigarh
• karvy chennai
• karvy coimbatore
• karvy company hyderabad
• karvy gachibowli
• karvy gurgaon
• karvy in hyderabad
• karvy jaipur
• karvy kolkata
• karvy madhapur
• karvy mumbai
• karvy office in bangalore
• karvy office in delhi
• karvy office in hyderabad
• karvy office in mumbai
• karvy office in pune
• karvy pune
• karvy vadodara

Objectives, Methodology and Scope of the Study

Statement of the Problem

Sales Promotion as a Marketing tool is gaining prominence over other elements in
Promotion Mix viz., Advertisement, Publicity or Public Relations, Personal Selling

62
and Direct Marketing in recent years. This is evidenced by the proliferation of sales
promotional offers in the market during Festival and Off Seasons to induce trial and
sometimes to shift in time the purchase decisions of consumers. Consumers are found
to advance or postpone their purchase based on Sales Promotion offers. The broad
agenda of this research is to study the influence of specific forms of sales promotion
on the perceived brand equity of certain selected products. Traditional marketing
theories suggest that sales promotion results in the dilution of Brand Equity. However,
the specific impact of Sales Promotion on Brand Equity of competing brands on
various dimensions is notable by insufficient research attention. This study attempts to
bridge this gap.

Brand Equity in layman’s terms is synonymous with credibility of the

brand in the minds of consumers. More technically it is defined as the ‘added value’
with which a given brand endows a product (Farquhar, 1989). In 1993, Kevin Keller
coined a term called Consumer Based Brand Equity (CBBE) to define Brand Equity
from the consumer’s perspective. The construct of Consumer Based Brand Equity
(Keller, 1993) posited a multidimensional approach and this view were used further
by Yoo and Donthu (2001) to develop a scale to measure CBBE. Brand Awareness
and Associations, Perceived Quality, Brand Loyalty and Overall Brand Equity of the
brands given by the consumers were the sub dimensions of Brand Equity according to
the measurement paradigm.

The present study envisages to find out the effect of two types of Sales Promotion on
Consumer Based Brand Equity of selected popular brands that belong to particular
product classes in three identified product categories, viz., Convenience, Shopping
and Specialty Products. The product class taken for the study under Convenience
Product is Toothpaste and the brands chosen are: Anchor, Closeup, Colgate, and
Dabur. The product classes taken for study under Shopping Product is Colour
Televisions and the brands chosen: are LG, Onida, Samsung and Sony. The product
class taken for study under Specialty Product is Athletic Shoes and the brands chosen
are: Action, Adidas, Nike and Reebok. The product class and brands were chosen
after conducting a pilot study.

63
 Studies have shown that there are differences in consumer behaviour towards the two
different types of Sales Promotions, namely, Price Promotion and Premium
Promotion. Hence this enquiry seeks to find out whether there exist any differential
and significant effects of Sales Promotion on Consumer Based Brand Equity. The
following are the specific questions attempted to be answered through this research.

Research Problem and Research Questions

a) Are there any differential effects of different types of Sales Promotions, namely, Price
Promotion and Premium Promotion on Consumer Based Brand Equity?

b) Which are the sources of Consumer Based Brand Equity affected by Sales Promotion,
Premium and Price Promotion?

c) What is the effect of these promotions in different categories of products, viz.,

Convenience, Shopping and Specialty Products?

These are the major problems addressed in the study. The research problem can be
summarised as a study of the differential effect of price and premium promotion on
dimensions of Consumer Based Brand Equity in selected brands of three product
classes belonging to Convenience, Shopping and Specialty product categories.

Significance of the Study

The study is significant from both application perspective of management as well as

from an academic point view.

The market is flooded with offers of different kinds. The consumers advance or delay
their purchase based on available Sales Promotions or on their expectations of such
promotional offers in the near future. Literature points out that Sales Promotion can

64
have a damaging effect on Brand Equity in the long run. This study will help the
marketers identify the dimensions of Consumer Based Brand Equity which are
affected by Sales Promotions and specifically what type of Sales Promotions, whether
Price Promotion or Premium Promotion is suitable for a given market. This
knowledge might be useful for marketers in judiciously implementing marketing
plans, especially Sales Promotions, both in the long as well as short term perspective.

For academicians, the study will give more insight into the dimensions of Consumer
Based Brand Equity and its chemistry with Sales Promotions, Price and Premium
Promotions. It will help to refine the scaling techniques employed to find out
Consumer Based Brand Equity in different categories and class of products.

Objectives of the Study

The study was an attempt to find out the effect of Sales Promotion, Price and
Premium Promotion, on Consumer Based Brand Equity. The dimensions of Consumer
Based Brand Equity under study were Brand Awareness and Associations, Perceived
Quality and Brand Loyalty. The product categories under study were Convenience
Products, Shopping Products and Specialty Products and the product classes taken
were Toothpastes, Colour Television and Athletic Shoes. The brands under study
were Convenience Products − Anchor, Closeup, Colgate and Dabur; Shopping
Products − LG, Onida, Samsung and Sony and Specialty Products − Action, Adidas,
Nike and Reebok.

The Primary objective of the study was to examine the effect of Sales Promotion,
Price and Premium Promotion, on Consumer Based Brand Equity (CBBE)

The study had the following specific objectives:

a) To find out the differential effects of Sales Promotions, viz., Price Promotion and
Premium Promotion on Consumer Based Brand Equity.

65
b) To explore the differential effects of Sales Promotion on the dimension of
Consumer Based Brand Equity, viz., Brand Awareness and Associations, Perceived
Quality and Brand Loyalty and Overall Brand Equity among Convenience, Shopping
and Specialty product categories.

c) To find out the effects of Sales Promotions, Price and Premium Promotions, on
different categories of products, viz., Convenience, Shopping and Specialty Products
on Consumer Based Brand Equity.

Research Hypotheses

Based on the review of literature and past studies, the following hypotheses were
formulated for verification for different product categories − Convenience, Shopping
and Specialty Products − through empirical investigation. The study had the following
hypotheses relating to Convenience, Shopping and Specialty product categories:

Convenience Products
Hypothesis 1.1 There is a significant effect of Sales Promotion on Consumer
Based Brand Equity. This hypothesis has four sub hypotheses pertaining to the four
dimensions of Consumer Based Brand Equity.

(a) Brand Awareness and Brand Associations,

(b) Perceived Quality
(c) Brand Loyalty
(d) Overall Brand Equity in Convenience Products.

Hypothesis 1.2 There is a significant differential effect on Consumer Based Brand

Equity due to Sales Promotions, Price Promotion and Premium Promotions, in
Convenience products.

66
Price Promotion affects Consumer Based Brand Equity more than Premium
Promotion in :

(a) Brand Awareness and Associations,

(b) Perceived Quality
(c) Brand Loyalty
(d) Overall Brand Equity in Convenience Products.

Hypothesis 1.3
There is a significant differential effect in the sources of Consumer Based Brand
Equity among brands due to Sales Promotions in Convenience Products.

Shopping Products

Hypothesis 2.1 There is a significant effect of Sales Promotion on Consumer

Based Brand Equity in terms of its dimensions

(a) Brand Awareness and Brand Associations,

(b) Perceived Quality
(c) Brand Loyalty
(d) Overall Brand Equity in Shopping Products.

Hypothesis 2.2 There is a significant differential effect on Consumer Based Brand

Equity due to Sales Promotions, Price Promotion and Premium Promotions, in
Shopping Products. Price Promotion affects Consumer Based Brand Equity more than
Premium Promotion in:

(a) Brand Awareness and Associations,

(b) Perceived Quality,
(c) Brand Loyalty
(d) Overall Brand Equity in Shopping Products

67
Hypothesis 2.3 There is a significant differential effect in the sources of Consumer
Based Brand Equity among brands due to Sales Promotions in Shopping Products.

Specialty Products

Hypothesis 3.1 There is a significant effect of Sales Promotion on Consumer

Based Brand Equity in terms of:

(a) Brand Awareness and Brand Associations,

(b) Perceived Quality
(c) Brand Loyalty
(d) Overall Brand Equity in Specialty Products.

Hypothesis 3.2 There is a significant differential effect on Consumer Based Brand

Equity due to Sales Promotions, Price Promotion and Premium Promotions, in
Specialty Products.
Price Promotion affects Consumer Based Brand Equity more than Premium
Promotion in:

(a) Brand Awareness and Associations,

(b) Perceived Quality,
(c) Brand Loyalty
(d) Overall Brand Equity in Specialty Products.

Hypothesis 3.3 There is a significant differential effect in the sources of Consumer

Based Brand Equity among brands due to Sales Promotions in Specialty Products.

68
Research Methodology

To meet the above objectives, hypotheses were formulated about the effect of sales
promotion on Brand Equity and were tested using a quasi experimental design by
manipulating the Sales Promotion offered and exposing selected subjects to such
experimental stimuli representing Sales Promotion offer profiles.

The dependent variable in the study was the Consumer Based Brand Equity and its
components measured by using the scale originally developed by Yoo and Donthu
(2001) suitably modified to assure the reliability and other scale properties in the local
context. The specific sub components were:

a) Brand Awareness and Associations,

b) Perceived Quality,
c) Brand Loyalty
d) Overall Brand Equity

Sales Promotion was divided into price promotion and premium promotion based on
available evidence of similar studies from literature. Price promotion was
operationalised as ‘15% off’ in market price and accordingly an offer stimulus was
designed to which the respondents were exposed (See Appendix IIA.1, IIB.1 &
IIC.1). Premium promotion was operationalized as an equivalent free gift in value to
price promotion and accordingly an offer stimulus was designed and respondents
were exposed to the stimulus (See Appendix IIA.2, IIB.2 & IIC.2). The promotional
offers were designed as visual experimental stimulus. The specific free gifts to
represent the premium promotion were identified based on the pilot study.

The study was replicated for three product categories, viz., Convenience Products,
Shopping Products and Specialty Products and in each of the product categories, a
certain product class was identified and used for the study based on the pilot research.

Respondents of this study consisted of teachers and students belonging to the

Mahatma Gandhi University and coming within the four districts of Kerala, viz.,

69
Ernakulam, Idukki, Kottayam and Pathanamthitta. For the product class, Colour
Television and Toothpaste, the teachers of the said university were taken while for the
product class, Athletic shoes, the college students of the same university were used as
respondents. The researcher used a sample size of 300 in each product class, viz.,
Convenience Products, Shopping Products and Specialty Products and thus giving a
total of 900 respondents.

The subjects for the study were chosen from the students and teachers of various
colleges of central Kerala. This decision was taken to restrict the study to the
academic community of students and teachers for ease of using probability sampling
procedures, access to the sampling frame and also considering the experimental nature
of the study which needed sustained subject cooperation.

Other extraneous variables particularly measured in the study were age, income,
education, gender, etc. and wherever differences were not observed on the dependent
variable, the subjects were clubbed into the same group for further analysis.

The subjects were randomly selected and randomly assigned to each Sales Promotion
stimulus condition in the experiment consistent with experimental research best
practices. The questionnaire to measure the dependent variable had broadly two parts.
The first part was administered prior to providing the experimental stimulus and then
after the exposure of subjects to the experimental stimulus, the second part was
administered.

Variables in the Study and Measurement

The study is on the effect of various Sales Promotional measures on Brand Equity
which is operationally measured as the construct ‘Consumer Based Brand Equity’ as
per the conceptualisation of Yoo and Donthu (2001). The dependant variable is
Consumer Based Brand Equity which is defined as the differential effect of Brand
Knowledge on consumer response to marketing of the Brand (Keller, 1993). Aaker
(1991) defined Brand Equity as a set of assets or liabilities, namely, Brand

70
 Awareness, Brand Associations, Perceived Quality, Brand Loyalty and other
proprietary assets.

Operationally, Consumer Based Brand Equity is defined as a set of assets or

liabilities, namely, Brand Awareness, Brand Associations, Perceived Quality and
Brand Loyalty. These are often referred to in literature as the sources or components
or constructs of Brand Equity. Along with items to measure Overall Brand Equity,
Yoo and Donthu (2001) developed a scale to measure the Consumer Based Brand
Equity which is used to operationally measure the dependent variable in this study.

Sources of Consumer Based Brand Equity

a) Brand Awareness: Brand Awareness refers to the strength of presence in the minds
of the consumers. It is defined as the consumer’s ability to identify or recognise the
brand (Rossiter and Percy, 1987). Keller (1993) conceptualised Brand Awareness as
consisting of both brand recall and brand recognition. Aaker (1991) mentioned several
levels of brand awareness, consisting of recognition, recall, top of the mind, brand
knowledge, brand opinion and brand dominance. In this spectrum, brand awareness
ranges from mere recognition of the brand to dominance, which refers to the condition
where the brand involved is the only brand recalled by a consumer.

Operationally, Brand Awareness is the ability of a buyer to recognise or recall that a

brand is a member of a certain product category.

b) Brand Associations: Brand Association is an important dimension of

Consumer Based Brand Equity. Brand Associations are believed to contain the
meaning of the brand for consumers (Keller, 1993). Aaker (1991) argued that
Brand Association has a level of strength, and that the link to a brand from the
association, will be stronger when it is based on many experiences or exposures
to communications, and when a network of other links support it. Aaker (1991)
was of the view that Brand Association could provide value to the consumer by
providing a reason for consumers to buy the brand, and by creating a positive
attitude/feeling among consumers. Keller (1993) classified Brand Associations as

71
 attributes, benefits and attitudes. Attributes are product or nonproduct related
while benefits are functional, experimental or symbolic. The non-product related
attributes are price, packaging, user imagery and usage imagery.

Krishnan (1996) empirically demonstrated that Brand Association characteristics

such as number of associations, valence and uniqueness underlie Consumer
Based Brand Equity. According to Krishnan, brands with high Brand Equity are
characterised by having a greater number of associations, and more net positive
and unique associations.

Operationally, Brand Associations are the informational modes linked to the

brand mode in the memory and contain the meaning of the brand for the
consumer. The favourability, strength and uniqueness of Brand Associations are
the dimensions of Brand Knowledge which are the core of Consumer Based
Brand Equity.

c) Perceived Quality: Perceived Quality is another important dimension of

Consumer Based Brand Equity. Aaker (1991) associated Perceived Quality with
price-premium, price elasticities, brand usage and stock return. Farquhar (1989) and
Keller (1993) considered Perceived Quality as the ‘core or primary’ facts of
Consumer Based Brand Equity as it has been associated with the willingness to pay a
price premium, brand purchase intent, and brand choice. Perceived Quality provides a
buyer with a realm to buy, differentiating the brand from competing brands.
Motameni and Shahroki (1998) considered Perceived Quality as a central frame of
reference because it involves a competitor’s frame of reference.

Operationally, Perceived Quality can be defined as the consumer’s judgment about a

product’s overall excellence, esteem or superiority of a brand relative to alternative
brand (Zeithmal, 1988). Perceived Quality is solely based on consumer’s or user’s
evaluation of the product and not manager’s or experts subjective evaluation of the
product and need not be based on the actual quality of the product.

72
d) Brand Loyalty: Brand Loyalty is a major component of Consumer Based Brand
Equity. Brand Loyalty has two dimensions, behavioural and attitudinal. The
proponents of the behavioural school of thought are Aaker (1991) and Oliver (1997).
Aaker (1991) defined Brand Loyalty as the attachment that a customer has to a brand.
Oliver (1997) defined Brand Loyalty as a deeply held commitment to rebuy or
repatronise a preferred product or service consistently in the future, despite situational
influences and marketing efforts having potential to cause switching behaviours.
Rossiter and Percy (1987) argued that brand loyalty has to be conceptualised on
attitudinal point of view as it is often characterized by a favourable attitude towards a
brand and repeated purchases of the same brand over time. Chaudhuri and Holbrook
(2001) were of the view that attitudinal brand loyalty includes a degree of
dispositional commitment in terms of some unique value associated with the brand.

Operationally, Brand Loyalty is defined as the tendency to be loyal to a focal brand,

which is demonstrated by the intention to buy the Brand as a primary choice (Yoo
and Donthu, 2001; Oliver, 1997).

e) The primary independent variable was Sales Promotion: Sales Promotion is

defined as a diverse collection of incentive tools, mostly short-term, designed to
stimulate quicker and/or greater purchase of particular product/services by consumers
(Kotler, 1988). The main purpose of a consumer promotion is to have direct impact on
the purchase behaviour of the firm’s customers (Kotler, 1988, Blattberg and Neslin,
1990). Consumer promotions are aimed at creating a ‘pull’ for end consumers while
promotions offered to trade and retailers are aimed at creating a ‘push’ through
channel members (Jha, Koshy and Sharma, 2005).

Sales Promotions can be classified as Price based and Non-Price based (Campbell
and Diamond, 1992; Blattberg and Neslin, 1990). Price based promotions are defined
as promotions such as coupons, cents off, refunds and rebates that temporarily reduce
the cost of the goods or service (Cooke, 1983).

Non-price based promotions, according to Cooke (1983), refer to promotions such as

give aways or contests in which value is added to the product at full price.

73
Operationally, Price Promotions are promotions which offer a discount on the regular
price of the product, and Premium Promotions are promotions that offer a free gift –
in addition to the main purchase, or offer an increased quantity of the product/service
without an increase in normal price.

This relationship was explored in the case of three different product categories, viz.,
Convenience, Shopping and Specialty and also separately for the two types of
promotions, viz., price and premium.

Other variables

The other variables in the study included demographic variables like gender, age,
education, income, etc.

Classification of Products

Any product is perceived by the buyer to be a contribution or bundle of utilities –

qualities, processes and/or capabilities (goods, services, and ideas) that is expected to
provide satisfaction (Levitt, 1975; 1980; Enis and Roering, 1980; Kotler, 1984).
Murphy and Enis (1986) assess consumer satisfaction in terms of benefit expected
minus cost incurred. The cost could be conceptualised on two independent dimensions
– effort and risk. Effort is the amount of money, time, and energy the buyer is willing
to expend to acquire a given product and is the objective measure of the value the
consumer places on the product. Risk is perceived when the product cannot deliver
the benefits sought and is essentially financial, psychological, physical, functional and
social.

Based on the above, Murphy and Enis (1986) classified products into four, namely
convenience, preference, shopping and specialty.

74
Convenience Products

Convenience Products are defined as the lowest in terms of effort and risk. In this
category of products, the consumer will not spend much money or time to purchase
the product, nor does he/she perceive significant level of risk in making the selection.
Convenience goods are those customarily purchased at easily accessible stores. The
unit price for most articles in this class is too small to justify the consumer’s going far
out of his way or incurring the expense to procure a special brand (Copeland, 1923;
Holton, 1958; Luck, 1959; Bucklin, 1963; 1976; Kaish, 1967; Holbrook and Howard,
1977; Ennis and Roering, 1980). Examples of goods that fall into the Convenience
Products category include soaps and detergents, toothpastes and brushes, shoe polish
and umbrellas.

Preference Products

Holbrook and Howard (1977) and Enis and Roering (1980) called products which are
slightly higher on the effort dimension and much higher on risk as Preference
Products. Through branding and advertising the marketer is able to generate
differentiation among the products and thus perceive risk on consumers. Examples of
Preference Products include soft drinks, alcoholic beverages, coffee, tea etc.

Shopping products

Copeland (1923), Luck (1959) and Bucklin (1963; 1976) have defined Shopping
Products are those for which the consumer desires to compare prices, quality, and
style at the time of purchase. Buyers are willing to spend a significant amount of time
and money in searching for and evaluating these products as the level of the risk
perceived by the consumers are high and hence have high involvement in purchase.
Example of Shopping Products include utility goods like refrigerator, washing
machine, colour TV; dresses, furniture etc.

75
Specialty Products

Copeland (1923), Bucklin (1963; 1976), Kaish (1967) and Enis and Roering (1980)
define Specialty Products as those which have some particular attraction for the
consumer other than price which induces him to put forth special effort to visit the
store in which they are sold to make purchase without shopping. The Specialty
Products are defined to be highest on both the risk and effort dimensions. Examples of
Specialty Products include men/women’s clothing, men/women’s shoes especially
athletic shoes, high end furniture etc.

However, most of the researchers on the product taxonomy agree that products can
best be classified into three categories, viz., Convenience, Shopping and Specialty
(Copeland, 1923; Bucklin, 1963; 1976; Kleimenhagen, 1967; Kaish, 1967; Kotler and
Armstrong, 2004). The notable exceptions are Holbrook and Howard (1977) and Enis
and Roering (1980) who advocated four categories of products adding Preference
Products into the above category. Following the common practice, in this study the
researcher has classified the products categories into three, namely, Convenience,
Shopping and Specialty.

The following table depicts the classification of consumer products based on market
considerations

76
 Consumer Product Classification and Market Consideration

Marketing Convenience Shopping Specialty

Considerations
Customer Buying Frequent purchase, Less frequent Strong brand
Behaviour little planning, little purchase, much preference and
comparison or planning and loyalty, special
shopping effort, shopping effort, purchase effort,
low customer comparison of little comparison of
involvement brands on price, brands, low price
quality, style sensitivity.
Price and Low Price, Higher price, High price,
Distribution Widespread Selective Exclusive
distribution, distribution in distribution in only
convenient fewer outlets. one or a few outlets
locations per market area
Promotion Mass promotion by Advertising and More carefully
the producer personal selling by targeted promotion
both producer and by both producer
resellers and resellers
Examples Toothpaste, Major appliances, Lifestyle goods,
magazines, laundry televisions, Expensive watches,
detergent furniture, clothing men’s wear,
athletic shoes.
Source: Kotler P., and Garry Armstrong (2004), Principles of Marketing, Pearson
Education, New Delhi, p. 280.

77
Universe and Sampling

The study involved exposing the respondents to experimental stimulus and getting
them to answer a very elaborate questionnaire including items to measure the overall
as well as the various sub components of Consumer Based Brand Equity. The
respondents typically had to spend around 60 minutes for the study. The researcher
therefore recruited the participants from college students and teachers primarily to
ensure the extended involvement of the respondents. This practice of using college
students and teachers is very common in consumer research (e.g. Yoo and Donthu,
2001; Washburn and Plank, 2002). Respondents of this study consisted of teachers
and college students selected from the four districts of Kerala, viz., Ernakulam,
Idukki, Kottayam and Pathanamthitta, coming under Mahatma Gandhi University,
Kerala. For the product class, Colour Television and Toothpaste, the teachers of the
said four districts were taken while for the Product class, Athletic Shoes, the college
students of the same districts were used as respondents. The teachers of the districts
included Arts and Science and Professional Colleges. The college students of the
districts who participated in the study included students of Arts, Commerce, Science,
Law, Management, Medicine and Engineering Colleges.

In the selected four districts of Kerala, there were 245 affiliated colleges consisting of
127 Arts and Science Colleges, 27 Engineering Colleges, 1 Law College, 4 Medical
Colleges, 7 Dental Colleges, 3 Ayuerveda Colleges, 2 Homeo Colleges, 22 Nursing
Colleges, and 43 Education Training and other Colleges constituting the higher
education spectrum of these districts. The respondents for this study, both teachers
and students, were selected at random from these colleges. The researcher followed a
two stage random sampling procedure where in the first stage, the colleges were
chosen at random from a master list of colleges and from each such college, and
students were randomly chosen from the roster available. In case a student was not
available or refused to participate on the day of the study, another student was chosen
to substitute the element (from the same college and on the same day).

The same sampling method was adopted for selecting teacher respondents also. The
teachers were chosen as respondents to get homogeneity in population in education,

78
socio-economic and other factors. Moreover, studies have shown that in a family the
purchase decisions are made by the main income earners, especially in complex
(shopping) and habitual (convenience) buying behaviour situations (Assael, 1984).

College students were chosen as respondents as it is widely accepted that students of

the age group (18-22) and such educational profile are the best judges for Specialty
products and life style goods as they are the users and are prone to affluent life styles
(Shimp and Bearden, 1982; Lichtenstein and Burton, 1989)

Moreover, the filling up of the questionnaire requires serious reading and takes
around an hour. Hence, the researcher decided that teachers and college students were
the best available respondents for the study considering the experimental nature of the
study and the long duration involved in collecting data using a questionnaire.

For studying the effect of Sales Promotion on Product classes, viz., Convenience
Products, Shopping Products and Specialty Products, there were four brands in each
class. Since there were two situations, namely, the effect of Price and Premium
Promotions, on the dimensions of Consumer Based Brand Equity, the researcher
wanted to ensure at least thirty respondents for each brand experimental stimulus
combination. Taking all these considerations into account, it was decided to have a
sample size of 300 in each Product Class. Therefore the researcher used a sample size
of 300 in each product class i.e., Convenience Products, Shopping Products and
Specialty Products thus giving a total of 900 respondents.

The sample design of the study is shown below:

79
 Sample Design of the Study
Sl. No. Uniformity Convenience Shopping Specialty
Criteria (Tooth Paste) (Television) (Sports Shoes)
1 Profession Teachers Teachers Students
2 Education PG PG Graduate and
Post-Graduate
Students
3 Geographical Ernakulam, Ernakulam, Ernakulam,
Area Idukki, Idukki, Idukki,
Kottayam and Kottayam and Kottayam and
Pathanamthitta Pathanamthitta Pathanamthitta
districts of districts of districts of
Kerala Kerala Kerala
4 Sample Size 300 300 300

Tools used for Data Collection The principal instrument used in the study is the
Consumer Based Brand Equity Scale developed by Yoo and Donthu (2001). The
construct of this scale is based on the theoretical framework provided by Aaker
(1991) and Keller (1993) who conceptualised the concept of Consumer Based Brand
Equity. The scale developed by Yoo and Donthu (2001) is etic in nature, i.e, the scale
is valid for universal measurement cutting across all cultures. The dimensions of
Consumer Based Brand Equity as envisaged by Aaker (1991) and Keller (1996) were:
Brand Associations, Brand Awareness, Perceived Quality and Brand Loyalty.

The study conducted by Yoo and Donthu (2001) among 460 under graduate students,
230 each from South Korea and U.S, included product classes Athletic Shoes, Camera
films and Colour T.Vs. They proposed and tested a model composed of the three
dimensions of Brand Awareness and Associations, Perceived Quality and Brand
Loyalty for measuring Consumer Based Brand Equity. The Consumer Based Brand
Equity Scale consisted of two constructs: Multidimensional Brand Equity (MBE) and
Overall Brand Equity (OBE). In MBE, there were ten items which measured five

80
Brand Awareness and Associations, two Perceived Quality and three Brand Loyalty
items respectively. They also developed OBE, a four-item uni-dimensional measure
of Brand Equity in order to check the convergent validity of MBE.

In this study, the researcher attempted to measure the impact of two different types of
promotion, namely, Price and Premium Promotions, on Consumer Based Brand
Equity and this was done for selected products from three product classes.

The researcher employed experimental stimulus and a questionnaire was used to study
the effect of Sales Promotion on Consumer Based Brand Equity. The questionnaire
consisted of three sections I, II and III. Section I consisted of questions pertaining to
the general awareness of the Brand. Section II consisted of the constructs developed
by Yoo and Donthu (2001) having MBE nine items and OBE four items to measure
Consumer Based Brand Equity on a seven point Likert scale. Section II has three parts
A, B and C. The respondents were asked to mention their favourite brand and
compare with other brands on the constructs of MBE and OBE in Part A.

In part ‘B’, the respondents were offered price promotion, i.e. cash discount to the
brands which were not their favourite brand mentioned in part A. Here the
respondents were required to compare other brands, which were offered price
promotion with their favourite brand on the same constructs of MBE and OBE. The
following table gives the details of the price/cash discounts offered to various product
categories under the study:

81
 Price Promotions of Different Product Class
Serial No Product Product class Brands Price
category promotion
1 Convenience Tooth paste Anchor, Close 15percent off
Products up, Colgate, market price or
Dabur Rs 5/- off
2 Shopping Color T V LG, Onida, 15percent off
Products Samsung, market price or
Sony Rs 1500/- off
3 Specialty Athletic shoes Action, 15percent off
Products Adidas, Nike, market price or
Reebok Rs 500/- off

Part ‘C’ dealt with Premium Promotion. Here respondents were offered free gifts for
other brands while their favourite brand was complacent or offered no gifts. The
respondents were required to compare other brands with their favourite brand on the
constructs of MBE and OBE. It should be noted that the same respondent is filling the
questionnaire pertaining to Price and Premium Promotions (i.e., B and C). The
Premium Promotion or free gift or extra products offered for various categories are
given below:

82
 Premium Promotions of different Product Class

Product Product class Brands Premium

Serial No category promotion
1 Convenience Tooth Paste Anchor, Close 15percent
Products up, Colgate, Extra
Dabur
2 Shopping Color T V LG, Onida, set worth Rs
Products Samsung, 1500/-
Sony Dinner
3 Specialty Athletic Shoes Action, T shirt worth
Products Adidas, Nike, Rs 500/-
Reebok

The section III pertained to information about marital status and other demographic
profile of the respondents.

While administering the questionnaire the respondents were shown pictures of

Brands with or without promotions in print or electronic media as the experimental
stimulus.

As explained earlier, the participants of the study were randomly chosen from the first
stage of selected colleges and randomly assigned to various experimental conditions.
The subjects were randomly selected and randomly assigned to each sales promotion
stimulus condition in the experiment consistent with experimental research best
practices. The questionnaire to measure the dependent variable had broadly two parts.
The first part was administered prior to providing the experimental stimulus and then
after the exposure of subjects to the experimental stimulus relating to Price Promotion
and Premium Promotion, the second part was administered.

83
Justification for the tools used

The researcher used Yoo and Donthu (2001) Consumer Based Brand Equity Scale to
study the effect of Sales Promotions on Brand Equity. The scale developed by these
researchers, as already mentioned, are etic in nature, i.e. can be employed across all
cultures. Moreover, the studies conducted by Washburn and Plank (2002) and Pappu,
Quester and Cooksey (2005) have validated the usefulness of the scale developed by
Yoo and Donthu (2001) to measure Consumer Based Brand Equity.

The study conducted by Washburn and Plank (2002) in the context of co-branded
products confirmed the constructs developed by Yoo and Donthu, namely MBE
having Brand Awareness/Brand Associations, Perceived Quality and Brand Loyalty
and Overall Brand Equity (OBE).

Pappu, Quester and Cooksey (2005) who conducted their study in Australia on
consumers of two different product categories, cars and television Chapter -3 90
School of Management Studies, CUSAT with six brands each, provided empirical
evidence of the multi dimensions of Consumer Based Brand Equity conceptualised by
Aaker (1991) and Keller (1993) and the scale developed by Yoo and Donthu (2001).

Similarly, Yoo, Lee and Donthu (2000) established the validity of MBE constructs on
Consumer Based Brand Equity: Brand Awareness and Associations, Perceived
Quality and Brand Loyalty while studying the examination of selected marketing
elements and Brand Equity.

Pilot Study

A pilot study was conducted to find out the most popular product class in
Convenience, Shopping and Specialty Products among 60 respondents each. The
study concluded that the popular Product class, i.e. the top rated in Convenience,
Shopping and Specialty, the products were Toothpaste, Colour Television and
Athletic Shoes respectively.

84
A second pilot study was conducted among another set of 60 respondents to find out
the popular brands in each Product categories: Convenience, Shopping and Specialty
Products. The study revealed that the popular brands (meaning the top rated four
brands) in Toothpaste Products are Colgate, Closeup, Anchor and Dabur; in Colour
Television: Sony, Samsung, LG and Onida, and in Athletic Shoes: Nike, Reebok,
Adidas and Action.

A pilot study was also conducted to check the feasibility of the study among 60
respondents in each product categories, namely, Convenience Products, Shopping
Products and Specialty Products before starting the data collection. This was done
with the objective of checking the suitability and reliability of the instruments used in
the study. On the basis of the study, the researcher made modification to some of
questions based on the comments from the respondents. Some words used for the
construction of certain questions were changed to make it easy to understand. The
responses collected for pilot study have not been used for the final data analysis.

Reliability Analysis of Pilot Study

The reliability estimates were provided by the pilot study using Chronbach Alpha,
which is a measure of inter-item correlation. The reliability indicated the extent to
which individual differences in test score are attributable to “true” differences in the
characteristics under considerations and the extent to which they are attributable to
chance errors (Anastasi, A and Urbina, S, 2003). The reliability analysis of product
categories, Convenience, Specialty, and Shopping Products are given below:

85
 Reliability Analysis of Convenience Products

Factors No of items Chronbach Alpha Sample size

N
A B C
Brand Awareness 5 0.303* 0.371*
and Associations 0.3088*
Perceived Quality 2 0.6138 0.6651 0.676 60
Brand Loyalty 3 0.6478 0.6841 0.651
Overall Brand 4 0.6110 0.637 0.682
Equity

A denotes the respondents’ views on the dimensions of CBBE without Sales

Promotion
B denotes the respondents’ views on the dimensions of CBBE with Price Promotion
C denotes the respondents’ view on the dimensions of CBBE with Premium
Promotion

The reliability scale revealed that items in Perceived Quality, Brand Loyalty and
Overall Brand Equity showed acceptable reliability while the items under Brand
Awareness and Associations showed low value in the reliability test. However, when
the last item in the questionnaire designed by Yoo and Donthu relating to Brand
Awareness was removed it showed acceptable reliability Alpha values 0.673, 0.654,
0.623 for A (without Sales Promotion), B (with price promotion) and C (with
premium promotion) respectively. The question removed was “I have difficulty in
imaging my favourite Brand in my mind”.

86
 Reliability Analysis of Shopping Products
Factors No of Chronbach Alpha Sample
size N
items A B C
Brand Awareness and 5 0.331* 0.342* 0.363*
Associations
Perceived Quality 2 0.653 0.640 0.606
60
Brand Loyalty 3 0.642 0.676 0.611
Overall Brand Equity 4 0.663 0.677 0.655

The reliability scale revealed that items in Perceived Quality, Brand Loyalty and
Overall Brand Equity showed acceptable reliability while the items under Brand
Awareness and Associations showed low value in the reliability test. However, as
done in the earlier case when the last item was removed, the Brand Awareness and
Associations showed acceptable reliability values Alpha values 0.683, 0.691, 0.666
for A (without Sales Promotion), B (with Price Promotion) and C (with Premium
Promotion) respectively.

Reliability Analysis of Specialty Products

Factors No of Chronbach Alpha Sample

size N
items A B C
Brand Awareness and 5 0.3321* 0.302* 0.331*
Associations
Perceived Quality 2 0.6235 0.6551 0.596 60
Brand Loyalty 3 0.6678 0.671 0.611
Overall Brand Equity 4 0.6543 0.657 0.662

The reliability scale revealed that items in Perceived Quality, Brand Loyalty and
Overall Brand Equity showed acceptable reliability while the items under Brand
Awareness and Associations showed low value in the reliability test. Here also, when

87
the last item was removed, the Brand Awareness and Associations showed acceptable
reliability values Alpha values 0.633, 0.621, 0.646 for A (without Sales Promotion), B
(with Price Promotion) and C (with Premium Promotion).

After making the necessary changes in the items pertaining to Brand Awareness and
Associations construct, the reliability figures from the pilot study are reported below:

Reliability Analysis of Product Categories for Brand Awareness and

Associations

Product Categories Chronbach Alpha Sample size N

A B C
Convenience Products 0.673 0.654 0.623
Shopping Products 0.683 0.691 0.666
300
Specialty Products 0.633 0.621 0.646

Reliability Analysis of Main Study

Based on the Reliability analysis done above, the questionnaires were designed and
administered. The result of the Reliability analysis of the main study is given below:

88
 Reliability Analysis of Convenience Products
Factors Chronbach Alpha Sample Size N
A B C
Brand 0.8541 0.861 0.848
Awareness and
Associations
300
Perceived 0.825 0.847 0.809
Quality
Brand Loyalty 0.818 0.838 0.847
Overall Brand 0.843 0.891 0.853
Equity

The reliability scale revealed that all the four items, viz., in Brand Awareness and
Associations, Perceived Quality, Brand Loyalty and Overall Brand Equity showed
acceptable reliability with high Chronbach Alpha values.

Reliability Analysis of Shopping Products

Factors Chronbach Alpha Sample
Size N
A B C
Brand Awareness 0.822 0.862 0.871
and Associations
Perceived Quality 0.847 0.864 0.838 300
Brand Loyalty 0.836 0.873 0.857
Overall Brand 0.872 0.866 0.881
Equity

89
The reliability scale for Shopping Products also showed acceptable reliability with
high Chronbach Alpha values for all the items in Brand Awareness and Associations,
Perceived Quality, Brand Loyalty and Overall Brand Equity.

Reliability Analysis of Specialty products

Factors Chronbach Alpha Sample
Size N
A B C
Brand Awareness 0.8021 0.834 0.828
and Associations
300
Perceived Quality 0.8735 0.821 0.861
Brand Loyalty 0.8478 0.851 0.826
Overall Brand 0.8143 0.837 0.842
Equity

The reliability scale for Specialty Products also showed similar high Chronbach
Alpha values in all four items in Brand Awareness and Associations, Perceived
Quality, Brand Loyalty and Overall Brand Equity.

Demographic Variables
The researcher had collected information regarding the gender, age, educational
profile, and income of the respondents. For studying effect of Sales Promotion on
Brand Equity the total income of the family was considered in all respondents
whether in the case of college teachers or students.

Limitations of the study

a) The study was restricted to the post-graduate students and teachers of Mahatma
Gandhi University coming under four districts of Kerala. Therefore, the results need
not be generalised to all sections or age or categories of people.

90
b) The study was on the effect of Sales Promotion on Consumer Based Brand Equity
of only three categories of products, viz., Convenience Products, Shopping Products
and Specialty Products and the researcher did not undertake an in-depth analysis of
specific brands.

c) The study examined the effect of Sales Promotion on Consumer Based Brand
Equity among goods only and hence did not cover services. Hence the results cannot
be generalised.

d) The study was only on a homogeneous population, viz., students and teachers and
therefore cannot be generalised across heterogeneous groups.

e) The demographic variable’s influence on the effect of Sales Promotion on

Consumer Based Brand Equity was not included in the study.

f) The study was conducted on a simulated environment and not on a real life
situation. Therefore results need not reflect the real life situation.

Statistical methods and Analyses The responses from the respondents were edited
and some of the responses were omitted as they were either not filled or filled
incompletely or not done properly. The valid responses were then coded and entered
into a spreadsheet of SPSS (Statistical Package for Social Services) software. Most of
the data analysis was done using SPSS 15. Statistical software, AMOS was also used
for checking the construct validity and reliability of the Consumer Based Brand
Equity scale.

The questionnaire consisted of three sections I, II and III. The I section consisted of
questions pertaining to the general awareness of the Brand. There 97 were 13 items in
each of the parts A, B and C section II of the questionnaire and the total number of
questions in that section came to 39. Section III of the questionnaire dealt with the
demographic profiles of the respondents. The study used a seven point Likert scale
varying from strongly disagree (1) to strongly agree (7). One question each from A,
B, C parts of section II corresponding to Brand Awareness and Associations was
91
removed as respondents viewed it differently, making it inconsistent with the logic of
the construct.

The statistical tool ‘t’ test was used to measure the effect of Sales Promotions on
Consumer Based Brand Equity and the differential effect between before the Sales
Promotion and after the Sales Promotion and between Sales Promotion, viz., Price
Promotion and Premium Promotion. ANOVA tests were done to find out the most
favourite brand (in the order of preference) among the brands by the population on
the sources of Consumer Based Brand Equity. Correlations, Reliability analysis and
Factor analysis were also performed. Since the Factor analysis results were not
statistically significant, the results were not reported in the study. Summary statistics
were computed and reported in the study.

Chapter Scheme

This thesis is presented in six chapters. The first chapter gives an introduction to the
topic and it deals with the relevance of the study in the light of prevailing market
situations.
The second chapter deals with the theoretical framework of the study. It is divided
into four parts. Part I attempts to define what is Sales Promotion, how it has been
classified by different authors and what are the different streams of Sales Promotion
from the perspective of market demand, consumers perception and how consumers
respond to different promotions. Part II tries to explain the origin of Brands, define
the term brand as given by American Marketing Association and various authors, and
evolution of brand concepts and images. Part III discusses the different definitions
and approaches to Brand Equity and Consumer Based Brand Equity as envisaged by
various authors. It also deals with the different approaches to measure Brand Equity
and Consumer Based Brand Equity. Part IV explains the sources of Consumer Based
Brand Equity, namely, Brand Awareness, Brand Associations, Perceived Quality and
Brand Loyalty.

Chapter 3 presents the significance, objectives and hypotheses of the study. It also
discusses the dependent variable, Consumer Based Brand Equity and sources of

92
Consumer Based Brand equity, the methodology adopted for conducting the study,
the reliability of the scale used, scope and limitations of the study, tools used for the
study and also give the chapterisation scheme of the study.

Chapter 4 presents the results of the analysis of the data to find out the effect of Sales
Promotion on Brand Equity.

Chapter 5 gives the results and discussion of the analysis of data to examine the
objectives and hypotheses of the study. Finally, Chapter 6 presents the conclusion,
scope for future research and implication of the research to management theory and
practice.

CONCLUSION

From this study it can be concluded that the customer relationship management in
Company is satisfactory. The company is using various CRM practices like
customization of the product, maintaining interaction with the customers regularly
and providing good quality product etc. Customer relationship management has a
certain impact on the profitability of the company. Average sale per customer has
increased 15% over the last two years. Customer response rate towards marketing
activities is also improving. There are various factors affecting the customer
relationship management like working environment of the company, support from top
management and coordination among the departments of the company. Information
technology is not used as much as it should be. The company is using traditional tools
of CRM like quantitative research, personal interviews. The company should modern
tools like data mining, contact center, e-CRM and web based survey tools.

Limitations of Customer Relationship Management

1. Time constraint is unavoidable limitation of my study.

93
2. Financial problem is also there in completing this project in a proper way.

3. As no work has been done earlier in this regard so scarcity of secondary data is
also there.

4. Inadequate disclosure of information is also the problem.

Suggestions
There should be more and more emphasis given by the company for satisfying the
customer up to a apex limit and by providing the utility of every penny of his money.

There should be more use of information technology.

The company should be flexible to bend its rules and procedures in the clients favour.

The company can communicate and develop stronger customer bonding by providing
social and financial benefits.

QUESTIONNARE

1. Who are your customers?

a) Wholesaler

b) Retailers

c) Both

94
2. Are your customer’s needs clearly defined ?

a) Yes

b) No

3. Do you conduct customer satisfaction surveys?

a) Yes

b) No

4. Do you communicate results of your customer satisfaction surveys regularly

throughout the company?

a) Yes

b) No

5. Do you actively seek out customer comments and complaints?

a) Yes

b) No

6. How do you get customer comments and complaints?

a) Face to face interview.

b) Toll free numbers, formal surveys.

c) Others means

7. How do you get information about the customers?

95
a) Face to face interviews

b) Surveys.

c) Any other means.

8. Do you analyze channel effectiveness? ie which channel is most effective in

serving the customer?

a) Yes

b) No

9. Do you provide credit facility to your customers?

a) Yes

b) No

10. Do you give concessions to your regular customer?

a) Yes

b) No

11. Do you take feedback from your customers?

a) Yes

b) No

12. Do you customize your product or services according to the customer?

96
a) Yes

b) No

13. Do you have a concept of “internal service”?

a) Yes.

b) No.

14. Do you communicate with your customers frequently?

a) Yes.

b) No.

15. Do you regularly review the business process to eliminate non value- adding
activities and improve customer satisfaction?

a) Yes

b) No.

16. Is the working environment is conducive to the well-being and morale of all
employees?

a) Yes

b) No.

17. How much is the role of computers in serving the customers?

a) Plays a big role

97
b) Not much role to play

c) No role to play.

18. Do you have centralized database for customer information?

a) Yes

b) No such database.

19. Does the staff have access to the customer database?

a) Yes

b) No

20. Is there commitment from top management to support the customer-focused

service concept?

a) Yes

b) No

21. Is there any improvement in average sale per customer?

a) Yes

b) No

22. Is there any improvement in customer response rate to the marketing activities?

a) Yes

b) No
98
23. Is there any improvement in customer retention and loyalty?

a) Yes

b) No

99