The automobile industry

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Introduction

The automobile industry wants to conduct a market research to know more about the factors that affect the choice of customers and what motivates them to purchase Honda Siel India Pvt Ltd cars. It is very important for every marketer to know about the buying motives of the customer because it helps them to design proper policies and programs to attract customers. It helps them to determine their advertisement budget and also to plan their various sales promotions.

The studying of consumer buying behavior is very important in framing price policies, product policies and distribution policies and also in sales and marketing. It is important for the marketers to understand the buying motives because it is helpful in understanding the buying motives and preferences of different customers, this enables the marketer to design the appropriate marketing strategies. It is also helps to plan and modify products according to taste and preference of customers.

Objectives

The primary objective of the research is to find out various drives that motivate customers to choose Honda cars. The secondary objective is to know the satisfaction level of customers and to know about the overall experience of customers about their dealers and also to know which class of customers is using Honda cars.

Research Methodlogy

Research Design

A research design is a logical and systematic plan prepared for directing a research study. It is the program that guides the investigator in the process of collecting analyzing and interpreting observations.

Here descriptive research design is used for analyzing why customers choose Honda Siel cars. It is very simple and more specific than exploratory study. The descriptive study is a fact finding investigation with adequate interpretation.

Data Collection:

Data Sources: In this stage, there is a need to gather primary as well as secondary data.

Primary Data - The present study has used survey method for collecting the primary data by directly interviewing the customers with questionnaire.

Secondary Data - Secondary data for the study were collected from library reference, journal and magazines, websites and previous studies.

Tool For Data Collections:

A well structured postal questionnaire and focus group was used to collect the primary data from the customers. The customers were given multiple choices to select their particular answers. A copy of the questionnaire is attached.

Industry Profile

India has the ninth largest automobile industry in the world with an annual production of 2.3 million units in 2008. In Asia India has emerged as the fourth largest exporter of automobiles during the year 2009, behind Japan, South Korea and Thailand.

After the economic liberalization in India in 1991, the Indian automotive industry has shown sustained growth due to increase in competition and relaxation in restrictions. Many Indian automobile manufacturers such as Tata Motors, Maruti Suzuki and Mahindra and Mahindra, have expanded their domestic and international operations. India's fast economic growth has further led to expansion of its domestic automobile market which attracted significant India-specific investment by multinational automobile manufacturers. During February 2009, monthly sales of passenger cars in India have grown more by one 1, 00,000 units.

Indian Automobile Industry includes the manufacture of trucks, buses, passenger cars, defense vehicles, two-wheeler manufacturing and heavy vehicle manufacturing units.

The major Car manufactures are:

1. Tata Motors

2. Maruti Udyog

3. Mahindra & Mahindra Ltd

4. General Motors India Pvt Ltd

5. Hyundai Motors India Ltd

6. Honda Siel Cars India Ltd

7. Toyota Kirloskar Motor Ltd

Conceptual Framework

Introduction: Consumer Buying Behavior And Buying Motives:

Consumer or buyer is the centre figure of all marketing activities. It is the consumer who determines the growth, prosperity and existence of a business enterprise. Hence the marketer should always feel the pulse of customers. In order to understand the pulse of the customer, the marketer needs to fully the working of buyers mind. It helps him to plan his production and distribution to suit to the needs and convenience of customers. It also helps him to plan suitable marketing strategies.

Consumer Behavior:

Consider the purchase of an automobile. You generally will not consider other options until some event happens such as potential big expenses for repairing. Once this happens now you are in the market and you begin to ask your friends and relatives for recommendations regarding dealerships and car models. After going to several dealerships and test driving many cars you finally zero down on a particular model. After purchasing the new car you have doubts if you can afford the monthly installments and if instead you should have bought a more expensive but potentially reliable model. Over the next five years the car has several breakdowns that lead you to want to purchase a different brand, but you have been very happy with the services of the local dealership and decide to again purchase your next car there.

The following generic model of consumer decision making appears to hold.

  • Need recognition
  • Information search
  • Evaluation of alternatives
  • Purchase decision
  • Post purchase behavior

Influences on the generic model:

External:

Group - e.g. cultural, family, reference group influences

Environmental/ Situational - e.g. time of day, temperature and humidity, etc

Internal:

Lifestyle, personality, decision making process, motivation, etc.

Buying Motives:

Motive is a strong feeling, instinct, desire or emotion that makes a person to do something. When a motive makes a person to buy a product, then it becomes a buying motive. Thus buying motive means the influence and considerations which makes a customer to buy a particular product. According to D.J. Duncan, “buying motives are those influences or considerations which provide the impulse to buy, induce action or determine choice in the purchase of goods and services”.

Buying motives are mainly motives two types, manifest motives and latent motives. Manifest motives are those motives which are know to the customer and also ready to admit them. But on the other hand latent motives are either known to the customer.

Buying motives can also be calculated as follows:

a) Product and Patronage motives

b) Emotional and rational motives

c) Inherent and learned motives

Product and Patronage Motives

a) Product Motives: it refers to those influences and reasons which make the consumer to buy a certain product in preference to another. These explain why people buy a certain product. Product are of two types:

i) Primary Product Motives: These motives induce a consumer to purchase general class of the product. These motives to relate to the basic needs of people like hunger, thirst and sleep.

ii) Selective Product Motives: These motives determine which particular brand or item will be purchased from the general class.

b) Patronage Motives: These are the motives which determine where or from whom products are purchased. These are the considerations which induce a buyer to buy goods from specific stores. Following are the key patronage motives.

i. Price

ii. Location

iii. Quality

iv. Variety

v. Services

vi. Personality of the owner or salesman

Emotional or Rational Motives

a) Emotional Motives: These are the motives which are affected by the feeling of the heart. Thus emotional motives are physiological needs and physiological needs such as thirst, hunger, sex, attraction etc.

b) Rational Motives: These are the motives where a consumer takes the decision of purchasing the product by his head and means i.e. after careful considerations and logical thinking. In making rational purchases, the consumer considers price, durability, dependability, efficiency etc. Rational Motives are the following types:

i. Monetary Gain

ii. Efficiency in operation

iii. Dependability motive

Inherent and Learned Motives:

a) Inherent Motives: These are the motives for the satisfaction of which a consumer his best efforts and if these motives are not satisfied he feels mental tension.

b) Learned Motives: These are the motives which are acquired or learned by a consumer from the environment and education. These motives are social status, social acceptance, religious belief, fear, security etc.

Post- Purchase Consumer behavior:

Satisfaction:

After the sale, the buyer will likely feel either satisfied or dissatisfied. If the buyer believes that he received more in the exchange that what was paid, he might feel satisfied. If he believes he received less in exchange what was paid, then he might be dissatisfied. Dissatisfied buyers are not likely to return as customers and are not likely to send friends, relatives and acquaintances. They are most likely to be unhappy or even abusive when the product requires post sale servicing, as when an automobile needs warranty maintenance.

Cognitive dissonance:

It has to do with the doubt that a person has about the wisdom of a recent purchase. It is very common for people to experience some anxiety after the purchase of a product that is very expensive or that will require a long term commitment.

Focus Group

The focus group interview is an effective qualitative technique in marketing research. Three actual marketing applications illustrate the usefulness of this approach for marketing mix problems. In focus groups, a moderator uses a scripted series of questions or topics to lead a discussion among a group of people. A neutral location is normally selected for these sessions, usually at facilities with videotaping equipment and an observation room with one-way mirrors. A focus group usually lasts one to two hours, and it takes at least three groups to get balanced results.

Focus group is also called as group discussion or group interview we could say that interaction between the one or more respondent and one or more researchers for collecting the research data (Focus Groups)

Focus group is generally talks about the

  • How group of people talks about their interest.
  • motivate new ideas
  • exploratory research

Basic Steps For Conducting Focus Groups:

  • Enlarge questions and probes.
  • Make script.
  • Identify and engage moderators and observers.
  • Educate moderators and observers.
  • Protected sites for focus group interviews.
  • Secure all required materials.
  • Send participants a reminder letter, or give them a reminder phone call.
  • Enter before time.
  • Verify the audio or video system, set up the room, and put out refreshments.
  • Conduct focus groups according to plan.
  • Thank the participants, and issue any participation incentives.
  • Note down field notes.
  • Estimate data across groups.

How To Plan And Prepare Of Focus Groups:

Determine the location, time, length, topic and schedule of the focus group earlier to contacting prospective participants. Effective focus groups generally consist of six to twelve participants in order to get a variety of opinions but to keep the group from being too busy and unmanageable. Consult with your supervisor, the company's sales and marketing departments, and customer lists to situate the mainly helpful participants or consultants. Group potential participants for appropriateness, e.g.; knowledge of the product/service, willingness to provide input in a group and so on. Determine the exact questions you will need to ask the focus group. As in One-to-one interview, arrange these questions in front of time, avoiding vague, yes or no, or loaded questions. Plan to tape-record or videotape the focus group, and to bring in a co-leader or moderator to take notes. Unlike a one-on-one interview, you will not be able to take valuable notes while leading a focus group.

Steps For Running A Focus Group:

  • Arrangement the sessions. Determine the information necessary the categories of people and the timing, location, and other organizational details.
  • Choose a knowledgeable facilitator to supervise on the information provided by the participants.
  • Invite 8 to 10 consumers to participate in each focus group meeting.
  • Place maximum of two hours. Hold the meeting in a satisfying and comfortable location.
  • Start with introductions and summary of the principle of the meeting.

How To Report The Focus Group:

The report letter is a brief review of key findings that usually is one or two pages in length. This report is generally written by the sponsor, with help from the analyst, and sent to people who participated in the sequence of focus groups. The reason is to declare participants that they were heard by importance of the key result and the reaction by the sponsor. This report regularly goes outside the findings to identify recommendations or suggestions for action. In a number of cases, this report is used in performance with a longer description report that may reference this document. The information in the message is personalized to an exacting audience, and more than one memo may be arranged from the same report, every one emphasizing items of concern for a particular group.

Focus Groups For This Research:

We will invite group of 8 to 10 owners of Honda cars at the research agencies facilities.

We have chosen participants from different backgrounds e.g. gender, education, occupation, location.

The focus group will be conducted by an industry expert from the automobile industry and will be for 2hours.

The research will be conducted with the help of pictures, questionnaires and interviews.

Sample questionnaire for Focus Group:

1. Why you choose this car brand?

2. Why you selected particular car model?

3. Were you satisfied with the pre-sales information and services provided by the dealer?

4. Are you able to operate all additional features in the car easily?

5. How you feel about the overall performance of the car?

6. Are you satisfied with the after sales services provided by the company?

Postal Ouestionaire

Questionnaire is a list of written questions, there are two types of questionnaire, first were respondent could asked to complete the question with researcher not present these types of questionnaire is called as postal questionnaire. And secondly respondent could asked to complete question with research present is called as structured interview (Sociological Research Skills).

Questionnaires are restricted two types:

Close ended: in this type researcher provides a list of suitable response (Sociological Research Skills).

Open ended: in this type researcher not provide any suitable list of response to the respondents, respondent asked to write the answer in their own way (Sociological Skills Research)

For this project I am using postal questionnaire because I would be able to cover a wider area of the location and also time. One of the most reliable methods of research is postal questionnaire because it is very easy for researcher to standardize and analyze the questions. Each respondent answered exactly same question. I am using close ended questioner, in this type there is no misinterpretation of answer because respondent are restricted to give answer. It is very easy to analyze the intentions of respondent (Sociological Research Skills).

Sample of postal Questionnaire:

POSTAL QUESTIONAIRE

NAME : ________________________

LOCATION : ________________________

AGE : ________________________

OCCUPATION : ________________________

1. How long have you been using this car?

Below 3 Months o 3-6 Months o

6-9 Months o 9months & above o

2. Have you been using any cars of Honda before?

Yes o No o

If Yes, Specify _________________

3. From which resource did you find the information for making your purchase decision?

TV Advertisements o Newspapers & Magazines o

Online Sources o Sales Representatives o

Experienced Users o Product Trials o

4. Rank in the order of your Preference to buy a car (in order 1-5)

Style o Comfort o Mileage o Price o Color

5. Rate the factor that influences your decision to buy a car?

Highly Influenced

Influenced

Not Influenced

1)Style

2) Comfort

3) Mileage

4) Price

5)Color

6)Product Features

7) Technology

8) Safety

6. Did easy availability of service and spare parts influenced your choice?

Highly Influenced o Influenced o Neutral o Less Influenced o Not Influenced o

7. Does the brand image of Honda have any influence on your buying decision?

Yes o No

8. How far celebrity advertisement influences your buying decision?

Highly Influenced o Influenced o Neutral o Less Influenced o Not Influenced o

9. What is the utilization of this car?

Official o Personal o

10. Who influenced you to buy Honda Car?

Family o Friends& Relatives o Colleagues o

Others o

11. Who make the decision to buy Honda?

Self o Spouse o Children o Collective o

12. From which dealer you buy the car?

13. What factors make you to buy from above dealer?

Loyalty o Service quality o Accessibility o

Brand Image o

14. Would you recommend Honda car to others?

Yes o No o

If yes specify the details ________________

15. What is the overall satisfaction level of Honda car?

Very Satisfied o Somewhat Satisfied o Neutral o

Somewhat dissatisfied o Very dissatisfied o

Suggestions if any

Thank you for the cooperation.

Conclusion

The research entitled the study of why consumers choose Honda cars and their buying motives, undertaken by automobile industry, would help the dealer to know about the preferences and motivation for customers to buy Honda cars.

Working on this project was a great opportunity towards gaining valuable knowledge about Marketing Research techniques and preparing the sample postal questionnaire. Once again I am thankful to Mr. Ken Wee and all our friends for their valuable support and guidance for completing this project.

References

Consumer Behavior - Leon G.Schiffman and Leslazar Kanuk, Ninth Edition, Pearson Education

Marketing Management - Philip Kotler, Tenth Edition, Prentice Hall India

Consumer Behavior - Hawkins, Best and Coney, Eight Edition, Tata McGraw - Hill

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