Various Watch Brands And Their Marketing Marketing Essay

This study is established on the basis of previous exploratory study on the various watch brands and their marketing and positioning strategy, the objective of the exploratory study was to study distinctive international and national men’s watch brands available in India and also to study of the men’s buying behavior towards the existing brands. The primary and secondary data analysis of the study lead to findings which noted that consumer prefers to buy national (Indian) watches brand and the most important attributes which motivated his buying decision was style & design of the watch and the other of the most important attribute was the price of the watches. On the basis of these findings the in-depth study on this project is carried, from the findings of exploratory study the hypothesis is formulated i.e. sales promotion excels the sales of men’s fashion accessories. From the hypothesis research objectives and research design is prepared. The objective of the study is to study effect of sales promotion on the men’s buying behavior towards the watches, to attain the objectives primary and secondary method of data analysis is used. Secondary data involved thorough study of the literature required for the study; literature review covered the theories regarding sales promotion, what are the benefits of sales promotion, what are its objectives, various tools and techniques of sales promotion, it also covers the theory on sales promotion and consumer behavior. To collect primary data questionnaire is prepared which is surveyed among the 100 men’s from the various regions of Delhi and in-depth interviews are also conducted, the surveyed questionnaires are analyzed through percentage method. The conclusion of the research is that sales promotion effects consumer buying decision towards watches; but the consumer are not aware of the sales promotions carried by the various premium watches brand.

Chapter1

1.1 INTRODUCTION

In exploratory study on men’s buying behavior towards the watches it was studied what parameters like durability, strength, price, brand identity and style & design effect the men’s buying behavior, do men prefer buying national or international watch brands. Through primary research and secondary research it was found that men’s prefer to buy or they owe the national brand of watches, the most important attribute which persuade their purchase of the watch is the style and design of the watches and second most preferred attribute is the price of the watches. The main purpose of this dissertation project is to study the effect of sales promotion on men’s and what is the perception of the men’s towards the sales promotion of the fashion accessories and whether it effect the Indian men’s buying decision towards the fashion accessory brands, study is focused on the sales promotion strategies and how it persuades an individual buying decision.

Sales promotion is enjoying a dominant role in the promotional mixes of most of the consumer goods companies. Sales promotion is the most important component of marketing budgets, in terms of magnitude and growth rates. The increased importance of sales promotion as strategic tools in the consumer markets has generated strong interest among the various brands to understand the mechanisms, effectiveness, and efficiencies of different sales promotion approaches; the primary role of sales promotion within a comprehensive brand management strategy is to stimulate immediate sales and consumer interest toward the promotion brand.

1.2 HYPOTHESIS

To conclude this following hypothesis are made to be studied further.

H1. Sales promotion excels the sales of men’s fashion accessories.

H1.1 Price discounts are the most effective sales promotion in influencing consumer buying decision.

H2. Price sensitivity may influence consumer buying decision for international watch brands.

1.3 RESEARCH OBJECTIVES

To identify which promotion strategy encourages the consumers to purchase the most?

To study the benefits of sales promotion.

To study the consumer perception towards the sales promotion.

To study various strategies adopted by the retailers.

1.4 RESEARCH METHODOLOGY

Market research is systematic design, collection, analysis and reporting of data and findings relevant to a specific marketing situation.

The research designs used is the descriptive to know the effect of sales promotion on consumer buying decision and to understand the consumer perception towards the sales promotion. The both primary and secondary method of data collection is used. For primary quantitative method is used to collect data, a questionnaire is prepared to measure the consumer response/attitude towards the various sales promotion activities, independent variables age and income were included in the study aiming to answer whether the effectiveness of the sales promotion varies between different age and income group. Survey research approach is used using questionnaires and it will be analyzed using percentage which is descriptive method of data collection. For the secondary data method will include periodicals, journals and other articles.

The sample size of a statistical sampling is the numbers of observations that constitute it, the sample size surveyed are 100 male respondents, by using convenience sampling method in the sample frame of Delhi regions.

1.5 SCOPE OF THE PROJECT

The project is to study the various sales promotion tools and techniques use to influence consumer buying decision towards the watches. The project also leads to what is the effect of sales promotion consumer behavior. The scope of the project is to understand the price sensitivity influence consumer buying decision of premium wrist watches brands.

LIMITATION OF PROJECT

The survey done in this project is confined to the regions of Delhi hence cannot be representative of India as whole.

Some of the respondents being rarely interested gave some rough ideas just for the sake of answering.

Lack of sufficient information from the retailers.

The survey is conducted on the single product category

Chapter 2

2.1 LITERATURE REVIEW:-

A fashion accessory business is one of the most profitable businesses, which demands marketing strategies and marketing promotions. Marketing promotions can help to generate higher profit and gain the trust of the consumers by engaging the consumers by providing right incentives. Consumer attitude towards the marketing activities are important knowledge for successful marketing operations. The marketer’s task is to devise marketing activities and to create an integrated marketing strategy to communicate and deliver values to the consumers, McCarthy classified these activities as marketing mix tools known as four P’s of marketing product, price, place and promotion.

Promotion is an umbrella term that describes all of the activities considered necessary for marketing communication. Promotional plan covers all phases of communication between the seller and the potential consumer. It addresses advertising and sales promotion and other forms of promotion. A good promotion strategy encompasses advertising, sales promotion, public relations and personal selling in order to communicate the services and product available to their customers (Kotler, 1994). Promotion is responsible for moving the demand curve upward and to the right by utilizing some or all of the elements of promotion mix-advertising, personal selling, publicity along with sales promotion (Ward and Hill, 1991). Promotion has become a vital function due to the advent of high diversification in the companies of fashion business, the main purpose of an organization is to sell to the customer and continue to sell the product or services offered and generate profit for the business this makes the promotion as the most essential concern of the management. The objectives of the promotion are firstly to inform about the offerings of the business to appropriate customer group, secondly to stimulate interest of these customer group towards the offerings, thirdly to persuade them in behalf of a political or theoretical idea, a person, an institution, fourthly to pave the way for selling the product, idea or services at the profit and fifth is to gain the loyalty of the customers. In today’s marketing require more than developing a good product, pricing it attractively and making it accessible for the target customer, it calls for companies to communicate effectively with the present and the potential consumer. The marketing communication mix consists of following major nodes advertising, sales promotion, public relations and publicity, events and experience, direct marketing, interactive marketing, word of mouth marketing and personal selling. Sales promotion has grown in importance for all the retailers worldwide. There is a rapid growth of sales promotion which is due to rise in advertisements and pricing; because of the clutter of various commercial messages has made the sales promotional substantial, thus it helps to make the difference among these commercials in the market and focuses on the promotions to reach the target audience.

Sales promotion is a composite of activities that round out the advertising and personal selling components of business. Sales promotion is an initiative undertaken by organizations to promote increase in sales, usage or trial of a product or services (Kotler and Kelvin, 2006). Sales promotion is an important component of an organizations overall marketing strategy along with advertising, public relations and personal selling. It is a direct inducement that offers an extra value or incentive for the product to the ultimate consumer with primary objective of creating an immediate sale (George, 1988). Sales promotion act as a competitive tool by providing an extra incentive for the target audience to purchase or to switch one brand over the other. The sales promotion is a key ingredient of marketing campaigns, which consists of collection of incentives for short term but to generate quicker sales of a particular product or the service offered, some of which could be trials on certain product in advance and with rapidity (Philip Kotler, 2003). Sales promotion is defined as the tool of attraction that persuade consumer to make an immediate purchases by offering extra values or incentives (Haugh, 1983). Sales promotion are those marketing activities other than personal selling, advertising and publicity that stimulates consumer purchasing and dealer effectiveness, such as displays shows and expositions, demonstrations etc (Achumba, 2002). It is noted that sales promotions are those communication activities other than advertising and personal selling that induce interest or trial or the final purchase by the customer (Bagavathi Pillai, 2007). The numerous definitions of sales promotions available have in common idea that sales promotions are temporary and tangible modification of supply, the goal of which is to directly impact consumers, retailer and sales force behavior.

Sales promotion accomplishes various objectives of marketing like to stimulate sales force enthusiasm, to stimulate sales for new brands, to introduce or facilitate sales of new products, to encourage repeated purchases of products (Shimp, 2000). The objectives of sales promotion are to draw a strong and faster consumer’s response to brand. The objective or the purpose of the sales promotion tools vary from in their specific objectives. A free sample stimulates consumer trial, where as a free management advisory services aim to strengthen the relationships with the retailers, thus collectively the objectives of the sales promotion is to attract new consumers, to reward the loyal consumers, to increase the purchase of the occasional users, to increase the market share through attracting brand switchers by providing the price-off or the premiums, to stimulate consumer desire to immediate purchasing, to generate short term increase in the sales and to promote retailers, brand’s image.

There exist multiple types of consumer benefits with the sales promotion. The different types of consumer benefits associated with sales promotions are primarily distinction of extrinsic and intrinsic benefits. Extrinsic benefits are instrumental, functional and cognitive they lead to the customer satisfaction of values. Intrinsic benefits are non-instrumental, experience and affectivenss regardless to any practical usage (Hirshman and Holbrook, 2000). The one of the benefits sales promotion provides is money savings, it is also avails quality benefits as customer can upgrade to higher quality of products by paying less for the un-affordable high quality products, sales promotion increases shopping the convenience benefits by providing information about the brand making the consumer search easier and cost effective. It enhances the consumer perception of being smart shopper and hence reaffirms their personal values benefits. Sales promotion in this ever changing environment of shopping stimulates the consumers purchasing by providing information and exploration of products and finally sales promotion is fun to use and explore.

There are numerous reasons for the growth of the sales promotion. Increase in competition and introduction of economic liberalization has lead to growth of the sales promotion. The consumer price sensitivity also excelled the growth of the sales promotion; the consumer has become more price sensitive due to inflation as consumer look for value for money or the low price or discounted product. Sales promotion have a instant and positive impact on sales, advertising, personal selling has been a slow sales response process while sales promotion is for short duration which leads to the sense of urgency among the consumer leading to higher sales. Product standardization has also created a buzz for sales promotion, availability of more of similar product in the market has made the advertisement less influential, thus a price sensitive consumer moves towards the product offered at lower price. Consumers are now getting aware of using various promotions and what benefits or rewards he can earn for being a smart shopper. Advertisement has become more expensive while sales promotion is cost effective method to generate sales. Sales promotion increases the impulse buying and maximizes the profit by allowing the brand to compete in many market segments through price discrimination.

Sales promotion methods fall into two groups consumer sales promotion process that includes samples, coupons, cash refund offers, price offs, premium, prizes, patronage rewards, free trials, warranties, tie into promotion, cross promotions, pop displays and demonstration (Pride and Ferrel, 1989). Trade sales promotion methods focus on wholesalers, retailers and salesperson which includes price-offs, advertising, display allowances and free goods. Some researchers have attempted to classify sales promotion into several categories. Two types of sales promotion categories are suggested based on the incentive types. One was from economic incentive, including discounts, coupons and rebates, while another is from psychological incentives which include premium and sweepstakes (Dommermuth, 1989). Sales promotion tools are categorized on the basis of timing given by sale incentives, instant and postponed sales promotion tools. Discount, premium and bonus pack were grouped as instant sales promotion tools while coupon, sweepstakes and rebates were grouped as postponed sales promotion tools (Shimp, 1990). Campbell and Diamond grouped in two varities of sales promotions tools one is monetary sales promotion and other is the non monetary sales promotion. Philip Kotler outlined thirteen sales promotion tools, in the recent years there are new sales promotion tools such as patronage awards from credit cards and e-coupons via email, point of sales (POS) devices. Currently the popular sales promotion tools which are offered by different retail sectors are:

Direct price-off / discount: A price discount is a temporary reduction of the listed price of the product. It is a reduction in a brand’s regular price. The major reason for marketers to use the price-off reductions is that this type of deal usually presents a readily apparent value to shoppers, especially when they have a reference price point for the brand, therefore they can recognize the value of the discount.

Coupon: A coupon is a promotional device that provides cent-offs savings to consumers upon redeeming the coupon. Coupons can be disseminated to consumers through newspapers and magazines, direct mail or through mobiles and packages.

Bonus pack/discount for a package: Provide additional quantity of product at the regular price in an enhanced package or offer a separate package of product at a discounted price. Bonus packs result in a lower cost per unit for consumers and provide extra value, as well as more products for the amount of money paid.

Buy-one-get-one-free offer: One more item is offered for free if the customer buys one item of a product at regular price. “Buy-two-get-one-free” and “buy-three-get-one free” are similar tools under the same deployment rationale.

Free premium/gift/ advertising specialties: A premium is an offer of merchandise or services either free or at a low price that is used as an extra incentive for buyers. Several forms of premium offers, serving different purposes exist. The three types of offers are free-in-the-mail premiums, in-and on pack premiums, and self-liquidating premiums. Premium is gift item offered free in return for the purchase of one or more products.

Joint / tie-in promotion: Another product is offered for free or at a discount upon purchasing of a particular product.

Stamp redemption: Stamp accumulations from repeat purchasing for discount, collectible premium or gift.

Contest, game and sweepstake: Games, activities, competitions and lucky draws are offered upon purchase of a certain product or arriving at a certain amount of values. They offer consumers the chance to win cash, merchandise or travel prizes. However, there are some differences between the two practices. A contest is a promotion where consumers compete for prizes or money on the basis of skills or ability. In a sweepstakes, winners are determined purely by chance.

Membership program: Discount or free product rewards are offered upon joining the membership program; members are later on entitled to certain privileges such as additional discounts or priority services, etc.

Patronage rewards from credit card: Points accumulations on credit card for discount, gift redemption, or cash refunds.

Free sample: Provides consumers a free small portion of a product, usually new to the market, for trial delivered door to door or sent through mail or picked up randomly at stores or by attaching it another product.

Refunds & Rebates: Refunds and rebates refer to the practice in which manufacturers give cash discounts or reimbursements to consumers who submit proofs of purchase. A refund refers to cash reimbursement for packaged goods, whereas a rebate more often refers to reimbursements for durable goods. These two sales promotion techniques provide users a delayed rather than an immediate value since the consumer has to wait to receive the reimbursement.

Event Sponsorship: In general, a company develops sponsorship relations with a particular event. In general, sports receive two-thirds of the event sponsorship budget.

According to many studies it is found that most of the consumer evaluates products on the basis of benefits the product delivers and weight age of these benefits varies from product, purchase decision. Usage of sales promotion activities has a direct impact on behavior of consumers as it motivates a consumer to buy now rather than in future or enhances value of an offer temporarily till the promotion period. The consumer response towards the various sales promotion technique or tools is influenced by the demographics and psychographics of the consumer and the response also depends on the positive experience and values provided by sales promotion. All individuals have their own experiences, knowledge and values that create beliefs about the use of a product or the service. Based on these beliefs they evaluate the positive and the negative aspects and arrive at a personal attitude toward the behavior, also customers behavior does not come without consequences from others. Thus, they are under a social pressure to act in a certain way. Internal and external limitations also influence customer behavior. Personal attitudes, social pressure and perceived control issues influence one’s intentions to make the purchase. In evaluation of consumer purchase decision in low involvement or repeated purchase the importance of some sales promotion are nil and some of them are the most important ones.

Most of the research on promotions is made on the basis of price promotion. Price promotions are applied as stimuli prior to and post behavior, but also as mechanisms that lead to improved category-wide product sales. Price promotions not only shift the demand for the promoted product, but also the demand for substitute, complementary and products within similar categories. The price promotions attracts new consumers, retaining the loyal customers, it stimulates multiple product sales and attract the brand switchers. Price promotion can also have an in store effect where by consumers may be induced to make unplanned purchase of the promoted products; it serves as the dual role of attracting shoppers and increase their shopping expenditure. Price promotion strategies have been linked directly to customer brand loyalty. If all the brands in a product market have high brand loyalty, price promotions will not be useful to any of the brands. In more competitive markets, where both stronger and weaker brands compete, the picture is more complicated. Brand loyalty was found to have the potential to explain the use of price promotion as well as the frequency and depth of discounts in various markets. There is a positive correlation between the number of competitors and a brand’s likelihood, of using price promotions in a product market.

To describe attribution theory it has been explains that the cause of events, different types of attribution can be distinguished based on the object about which the attribution is being made (Mizerski, Golden and Kernan, 1979). Attributions made about self come under self perception theory while attributions made about an object/ brand come under object perception theory. Each is analyzed in the context of promotions. According to self perception theory a purchase in the presence of a strong promotion is expected to lead the consumer to attribute purchase to an external cause at times of promotion rather than an internal cause i.e. to have liking for the product. This will lead to discontinuing of a favorable brand and repeat purchase probability will diminish. Object perception theory states that continuous promotion leads to the development of negative consumer attribute towards the brand considering at as an inferior quality brand. Attitude model depict that the consumer’s decision to perform a specific behavior is due to the consequence of beliefs, attitudes and intentions with regard to the behavior. As per this model, a consumer’s intention to buy a brand may be based on positive/negative attitudes towards a promotion (Fishbein and Ajzen, 1975). Consumer attitude towards any sales promotion technique is formed by their beliefs in the rewards and cost incurred in using the scheme. The adaptation-level theory explains that individuals compare prices, or any other attribute, to a personal reference level instead of valuing their absolute amount (Helson, 1964).

Chapter 3

DATA PRESENTATION

The research is conducted as a quantitative study and it investigates the relationship between sales promotion and consumer behavior in one product category for men. Survey research approach will be using questionnaires, and the questionnaires are analyzed using percentages which is a descriptive. All the questions used to measure the men’s opinion were closed ended. The research administered questionnaires on 100 men from the different regions of Delhi, who are between age group of 18-40yrs and above and by profession they are students, employed or doing business, the monthly income or pocket money of this sample surveyed is between Rs. 10, 000 to Rs. 60, 000 and above. The consumer surveyed are the market expertise, they tend to have information of all the products and the places to shop. These are the men from the nuclear family; they embrace the concept of style and sustainability. They prefer the superior products in terms of quality, uniqueness and range and services comprising availability, ambience, and convenience at the best possible price lower cost and seek superior value for money. Tables and charts illustrate these findings and significant results related to groups are identified where differences exist.

Chapter 4

ANALYSIS & FINDINGS

The survey was conducted to analyze the effect of sales promotion on the buying decision of the men. From the survey it is found that 58 percent of men who are surveyed are between age group 18-25 years, 21 percent of them are between the age group of 26- 30 years, 13 percent are from 31-35 years of age, 7 percent and 5 percent are from age group 36-40 years and 40 years and above respectively. The Graph1 below shows the survey findings.

Graph 1

Graph 2

From the Graph 2 it is analyzed that the survey conducted among the men in various regions of Delhi it is found that men between age group 18-25 years consists of 29 per cent of students, 4 percent of them their own business and 23 per cent of private firm employees and 2 percent of government employees; 26-30years of age group have 3 percent of students, 7 percent of business man and 11 per cent of them are private firm employee. In 31-35 years of age has 4 percent of business man, 9 per cent of private firm employees; age group 36-40 years of age have 3 percent of business man and 4 percent government employees and in the age group 40 years and above only 1 percent of them are the government employee.

Graph 3

The graph above shows that men surveyed between the age group of 18-25 years 48 percent of them have monthly income between Rs. 10, 000 to 30, 000, 7 percent of them have income Rs. 30, 001 to 50, 000, 3 percent of them have income from Rs. 50,001 to 60, 000. Men in the age group 26-30 years 4 percent of them have income between Rs. 10, 000 to 30, 000, 10 percent of them Rs. 30, 001 to 50, 000, 7 percent of them are have their income Rs. 60, 000 and above; in age group 31-35 years 4 percent have per month income Rs. 30, 001 to 50, 000 and 9 percent have income Rs. 60, 000 and above and in the age group 36-40 years 1 percent have income Rs 10, 000 to 30, 000, 3 percent have income Rs. 30, 001 to 50,000 and 1 percent of men in 40 years and above age have monthly income Rs 60, 000 and above.

Graph 4

The Graph 4 represents the whether the men prefers to buy or will buy wrist watches of various premium watches brand at their original price. The graph shows that 62 percent of men prefers to buy premium brand wrist watches at their original price and 38 percent refuses to buy various the premium brand wrist watches at their original price.

Graph 5

The survey is to determine the effect of sales promotion on men’s buying behavior towards watches. And the Graph 5 shows those men in different age group and their preference to buy wrist watches at time of sales promotion. The 44 percent men in age group 18-25 years prefers to buy watches at time of sales promotion and 14 percent of them will not buy and in age group 26-30 years 9 percent of men agrees to buy wrist watches at time of sales promotion and 12 percent of men do not prefer to buy at time of sales promotion, 7 percent says yes and 6 percent says no in between the age group 31-35 years, in age group 36-40 years 7 percent says yes that the will prefer to buy watches in sales promotion and 1 percent of men agree to buy at time of sales promotion in age group 40 years and above.

Graph 6.1

Graph 6.2

Graph 6.3

Graph 6.4

The graphs above represents men’s of different age group and occupation whether they are encouraged through sales promotion to makepurchase of their wrist watches. The graph 6.1 shows the men in age group 18-25 years 25 percent students, 4 percent business man, 3 percent government employees and 23 percent private firm employees are encouraged buy sales promotion to buy for their watches. In Graph 6.2 in age group 26-30 years 2 percent student, 3 percent businessman and 3 percent private employees are encouraged by sales promotions to make purchase of wrist watches and also 4 percent of business and 8 percent private employees says no that they are not encouraged by sales promotion. In Graph 6.3 9 percent private firm employees and 4 percent business man of age group 31-35 years are encouraged to buy wrist watches attime of sales promotion and in Graph 6.4 the age group 36-40 years 3 percent business man, 1 percent governmet employee agrees that they are encouraged to make purchase at time of sales promotion and in age 40 & above years 1 percent government employee also agrees but in age group 36-40 years 3 percent government employee are not encouraged to buy wrist watches at time of sale promotion.

Findings 1:

The one of the objective of this project was to identify which promotional startegy encourages consumers to buy more. To achieve successful conclusion of the objective, from the secondary data literarture it was found that advertisement and personal selling are quite expensive and they generate slower sales, due to the clutter of communication and products it is difficult to differentiate through advertisements due to this sales promotion come in to distinct the brand from other. and also consumer has become more price sensitive. From the graph 5 and graph 6.1 to 6.4 shows that most of the men of different age groups and profession are encouraged by sales promotions to make the purchase of men’s wrist watches. Thus from the primary and secondary data it is concluded that sales promotion is the most effective promotion which encourages consumer perception to purchase more.

Graph 7

The Graph 7 represent men of different age group and what drives them to make purchase of the watches. In the age group 18-25 years 24 percent make purchase for watches when at time of price discounts, 3 percent for each at time of free gifts, free coupons and exchnage offers and 35 percent of men in same age group shop for the watches whenever they feel it is required to make the purchase. 5 percent prefers to buy watches at time of price discounts in age group 26-30 years, in the same age group 16 percent men shop for watches whenever the require it. In age 31-35 years 4 percent men shop at time of price discounts and 9 percent whenever they require, 7 percent men buy for watches when they require in age group of 36-40 years and in 40 years and above age 1 percent for each men buy watches at time of free coupons and free gift offers.

Graph 8

The Graph 8 represents various attribute which men seek at time of sales promotion. 46 percent of total sample population wants quality at time of sales promotion, 38 percent requires price discounts and 16 percent need convenience at time of sales promotion.

Finding 2:

The another objective of the project was to study the various benefits attached to the sales promotion. To attain this objective it is found from the literatu