IndianManagement

Studies Journal

Consumer Behaviour Regarding BrandedMilk vis-a-vis Unbranded Milk

Sandeep Singh Virdi* Dyal Bhatnagar** Hardeep Kaur** Punjab School of Management Studies, Punjabi University, Patiala, Punjab (India)

** University School of Business Studies. Punjabi University Guru Kashi Campus.

Talwandi Saba, Dist. Bathinda. Punjab (India)

Abstract

India's dairy market is multi-layered. It's shaped like a pyramid with the base

made up of a vast market for low-cost milk. Consumers while purchasing dairy products

look for freshness, quality, taste and texture, variety and convenience. How to make milk

and milk products affordable for the large majority with limited purchasing power is essence

of the challenge in the present scenario. In contrast, with a constant increase in disposable

incomes among the strong middle income class also, the scope of marketing of milk has

widened. Since the consumers are not homogeneous, the consumption pattern of milk like

quantum of purchase, mode of purchase, source of purchase, brand preference etc., is

continually varying. Dairy companies, particularly in Punjab, will have to spend lot of

effort on advertising and other promotional activities. Milk companies are also advised to

strengthen their supply chain and other logistics and use intermediaries to promote and

make their products available to the end consumer.

The socio-economic profile of the consumers, viz. income status, occupational

position, educational level, age and region are the major determinants of the consumption

patterns of milk. Hence, the concentrate of the present study will deliberate on the profile

of consumers, their consumption pattern in milk consumption and its correlates.

During the last three decades, our nation's milk producers have transformedIndian dairying from stagnation to world leadership. During this period and before,

science and technology (S&T) have played a critical role in supporting our farmers'efforts. During the next decade, that role will be further enhanced as we face anumber of new challenges.

The dairy cooperative movement has been central to the development ofdairying in India. The inspiration for this movement was the success of the KhairaDistrict Cooperative Milk Producers Union -- better known as AInu!. Founded in1946 in response to the exploitation of districts dairy farmers, AInul grew rapidlyfrom its initial base of two societies and two hundred litres of milk. That growth,however, posed a challenge that threatened its existence: flush season productionof milk exceeded the demand. Yet the cooperative's success depended on acceptingthe farmer's milk year round. At that time the advanced dairying nations conservedmilk by conversion into powder and butter. This could either be sold as products,or combined with fluid milk to extend the supply during the lean season whendemand outstripped production. Experts from the North, pronounced buffalo milkas unsuitable for conversion into powder. It could not be done, they said. Thisprovided the opportunity for the first major Indian scientific and technologicalbreakthrough. The AInul staffled by the then General Manager; solved the problemsby producing powder from buffalo milk. It would not be an exaggeration to say thatthis advance in the technology saved AInul and, with it, ensured the future of theas yet unborn Indian dairy cooperative movement. Since that time, S&T haveproduced a large number of breakthroughs that have been critically important tothe development of Indian dairying.

The Indian dairy industry acquired substantial growth during the 8th Plan,achieving an annual output of over 69 million tonnes of milk. India's milk outputduring the year 2000-01 was estimated to be 81 million tones. (Source: Governmentof India, Ministry of Agriculture, Department of Animal Husbandry, Dairying &Fisheries). This has not only placed the industry first in the world, but alsorepresents sustained growth in the availability of milk and milk products for theburgeoning population of the country. Most important, dairying has become animportant secondary source of income for millions of rural families and for millionsmore, has assumed the most important role in providing employment and income.The per capita availability of the milk has also increased to a level of about 221 g.per day, but this is still very low as compared to developed nations or the worldaverage of 285 g.per day. Government of India is making efforts to increase theproductivity of milch animals and thus increase the per capita availability of milk.

India's dairy market is multi-layered. It's shaped like a pyramid with thebase made up of a vast market for low-cost milk. The bulk of the demand for milkis among the poor in urban areas whose individual requirement is small, may be a

glassful for use as whitener for their tea and coffee. Nevertheless, it adds up to asizable volume - millions of litres per day. In the major cities lies an immense growthpotential for the modem sector. Presently, barely 778 out of 3,700 cities and,townsare served by its milk distribution network, dispensing hygienically packedwholesome, quality pasteurized milk. According to one estimate, the packed milksegment would double in the next five years, giving both strength and volume tothe modem sector. The narrow tip at the top is a small but affluent market forwestern type milk products

Of the three A's of marketing - Availability, Acceptability and Affordability,Indian dairying is already endowed with the first two. People in India love to drinkmilk. Hence, no efforts are needed to make it acceptable. Its availability is not alimitation either, because of the ample scope for increasing milk production, giventhe prevailing low yields from dairy cattle. It leaves the third vital marketing factoraffordability.

How to make milk affordable for the large majority with limited purchasingpower is essence of the challenge. One practical way is to pack milk in smallquantities of 250 ml or less in polythene sachets. Already, the glass bottle forretailing milk has given way to single-use sachets which are more economical.Another viable alternative is to sell small quantities of milk powder in mini-sachets,adequate for two cups of tea or coffee.

India, with her sizable dairy industry growing rapidly and on the path ofmodernization, would have a place in the sun of prosperity for many decades tocome. In 2002, India's milk production stood at 81 billion litres of which about 15per cent of the volume was packaged (Venkatraman, 2002). The one index to thestatement is the fact that the projected total milk output over the next 15 years(1995-2010) would exceed 1457.6million tonnes which is twice the total productionof the past 15 years!

The National Dairy Development Board has drawn up a Perspective Plan,2010 for Cooperative Milk Unions, with the objective to raise milk procurement andincrease cooperative share in marketing of milk and milk products. 80 Milk Unionshave submitted their Perspective Plans to NDDB with an outlay of about Rs. 900crore. NDDB has approved Plans of about 60 Milk Unions with an investmentoutlay of Rs. 750 crore. Formalities of entering into agreements / hypothecation ofassets are being completed (Source: Government of India, Ministry of Agriculture,Department of Animal Husbandry, Dairying & Fisheries.)

India with 204 million cows and 84 million buffaloes has the largestpopulation of cattle in the world. Milk production gives employment to 70 milliondairy farmers. In terms of total production, India ranks 1st with a production of 78

million tonnes annually. Although milk production has grown at a fast pace duringthe last three decades, milk yield per animal is very low in India at around 1.5 litresper day. The main reasons for the low yield are lack of use of scientific practicesin milching, inadequate availability of fodder in all seasons and unavailability ofveterinary health services.

Over 50% of the milk produced in India is buffalo milk, and 45% is cowmilk (Source: The World Dairy Situation 2006 Report - Statistical Data). Buffalo milkhas 3.6% protein (Hogberg and Lind), 7.4% fat, 5.5% milk sugar, 0.8% ash and 82.7%water, whereas cow milk has 3.5% protein, 3.7% fat, 4.9% milk sugar, 0.7% ash and87% water. Fresh pasteurized milk is available in packaged form. However, a largepart of milk consumed in India is not pasteurized, and is sold in loose form byvendors. UHT Sterilized milk is also available and is becoming popular.

Consumers while purchasing dairy products look for freshness, quality,taste and texture, variety and convenience. Products like Dahi and sweets likeKheer, Basundi, Rabri are perishable products with a shelf life of less than a day.These products are, therefore, manufactured and sold by local milk and sweetshops. There are several such small shops within the vicinity of residential areas.Consumer loyalty is built by consistent quality, taste and freshness. There areseveral milk-based sweetmeat shops, which have built a strong brand franchiseand have several branches located in various parts of a city.

Gujarat Co-operative Milk Marketing Federation (GCMMF) has also madea beginning in branding of other traditional milk products with the launch ofpackaged Paneer under the Amul brand. It has also created a new umbrella brand"Amul Mithaee" for a range of "ethnic Indian sweets that are proposed to belaunched. The first new product Amul Mithaee 'Gulabjamun' has already beenlaunched in major Indian markets.

Western table-spreads such as butter, margarine and jams are not verypopular in India. All India penetration of butter/ margarine is only4%. This is alsolargely represented by urban areas, where penetration is higher at 9%. In ruralareas, butter / margarine have penetrated in 2.1 % of households only. The useof these products in the large metros is higher, with penetration at 15%.

Penetration 'of cheese is almost nil in rural areas and negligible in theurban areas. Per capita consumption even among the cheese-consuminghouseholds is a poor 2.4 kg p.a. as compared to over 20 kg in USA. The lower

penetration is due to peculiar food habits, relatively expensive products and alsonon-availability in many parts of the country. Butter, margarine and cheese productsare mainly manufactured by organized sector.

Similarly, penetration of ghee (ghee is similar to butter oil with strongaroma) is highest in medium sized towns at 37.2% compared to 31.7% in all urbanareas and 21.3% in all rural areas. The all India penetration of ghee is 24.1%. Inrelative terms, penetration of ghee is significantly higher in North and West,which are milk surplus regions. North accounts for 57% of ghee consumption andWest for 23%, South & East together account for the balance 20%. A large partof ghee is made at home and by small/cottage industry from milk. The relativeshare of branded products in this category is very low at around 1-2%.

Milk powder and condensed milk have not been able to garner anysignificant consumer acceptance in India as indicated by a very low 4.7%penetration. The penetration is higher at 8.1% in urban areas and lower at 3.5%in rural areas. Within urban areas, it is relatively higher in medium sized townsat 8.5% compared to 7.7% in large metros.

The packaged milk segment is dominated by the dairy cooperatives.Gujarat Co-operative Milk Marketing Federation (GCMMF) is the largest player.All other local dairy cooperatives have their local brands (For e.g. Gokul, Waranain Maharashtra, Saras in Rajasthan, Verka in Punjab, Vijaya in Andhra Pradesh,Aavin in TamilNadu, etc).

Over the years, several developments in packaging media have takenplace. In the early 80s, plastic pouches replaced the bottles. Plastic pouchesmade transportation and storage very convenient, besides reducing costs. Milkpacked in plastic poucheslbottles have a shelf life of just 1-2 days, that too onlyif refrigerated. In 1996, Tetra Packs were introduced in India. Dairy co-operativesin Andhra Pradesh, Tamil Nadu, Punjab and Rajasthan sell milk in tetra packs.However, tetra packed milk is costlier by Rs.5-7 per litre as compared to milkpacked in plastic pouches.

According to Chapter XXII (Dairy Development in India) of Pursuit &Promotion of Science (2000), milk production is, of course, only half of the story.The other half is the sale' of milk and milk products that provides the highestreturns to our dairy farmers. Here too, S&T have played an important role indevelopment of products, processes, packaging, handling, transport and storage.Among the major breakthroughs have been: automation of khoa production,moving this process from the backyard to the modern dairy; design of the processtechnology and equipment for manufacture of peda, gulab jamun, long-life paneerand other Indian milk products; development of continuous lines, including

packaging, for fermented milk products like long life lassi, shrikhand,dahi (yoghurt)and misti doi; process technologies for production of Cheddar,Mozzarella and Emmental cheese as well as a variety of cheese spreads usingboth cow and buffalo milk; preservation of starter cultures for fermented milkproducts; process of manufacture of dry mixes for gulab jamun and frozen deserts;user-friendly milk testing kits.

As satisfying as the achievements have been, the real challenges lieahead. Among the most important are: Ensuring steady growth in productivitywhile ensuring that dairying remains concentrated in our landless, marginaland small farmer communities; Using advanced breeding technologies toaccelerate the development of our high potential Indian cattle and buffalobreeds; Developing quality control methods that are sensitive to the fact thatour milk comes from large number of small producers; Ensuring increasingreduction in losses from endemic and epidemic diseases at costs our farmerscan afford; Expanding the variety, improving the quality and maintaining therelative price of India's dairy products so that they can meet competition fromaround the world; Ensuring that the growth of the dairy industry contributesto enrichment of our environment while continuing to benefit low-incomeproducers without compromising our nation's need for milk. These and otherchallenges face the current and next generation of scientists and technologists.Their predecessors have built a solid foundation. The strength of thatfoundation is due in large part to the fact that India's dairy farmers have setthe research agenda. Beginning with Amul during the 1940s, it was their needthat inspired the work of our dairy scientists and technologists. It is theevolving needs of India's several million dairy farmers that will inspire thosewho follow.

According to Directorate General of Commercial Intelligence and Statistics(DGCIS), Kolkata, India exported dairy products worth US $ 35 million in 2003-04. Asian markets are the major destinations for Indian dairy products accountingfor nearly one-third of total exports. Major Asian markets for Indian dairy productsinclude UAE, Bangladesh, Nepal, Bhutan, Yemen and Kuwait. Major export itemsare milk and cream in concentrated form followed by butter and fat. India alsoexported dairy items like buttermilk / curd, whey, milk and cream not in concentratedform and cheese, albeit negligible volume.

Prasad (2006) found in his study that 91.33% of the consumers knewthe availability of more than one variety of milk available in the market. He also

established that a large majority of respondents 62.33% said that it is the qualitythat influences the choice of the brand, whereas a meagre 5.67% expressed theview that it is the factor of easy availability that is responsible for the preferenceof a brand. He found that a majority (about 82.67%) of the respondents weresatisfied with the present brand they were using and only 17.33% though otherwise.He further suggested that prompt and regulat supply, providing value by way ofservice rendered by agents and avoidance of adulteration are factors that willcount in the success or failure of the milk producers.

Parekh (2006) in his research established that, of the total milk producedin the country, nearly 46 per cent is consumed as liquid milk (Table 1) and thebalance converted into various dairy products, such as ghee, butter, milk powder,ice cream, cheese, condensed milk and for making various kinds of sweetmeatshaving distinct regional preferences.

Table 1

Milk Utilisation Pattern in India

Year 1943* 1956 2004

Milk Production (million tonne) 23.5 17.8 91

Milk Utilisation (percentage) 100 100 100

Liquid Milk 28.0% 39.2% 46.0%

Traditional Products 72.0% 60.8% 50.0%

Ghee/Makhan (Butter) 58.7% 46.0% 33.0%

Dahi Tyoguri (Ice) 5.2% 8.8% 7.0%

Khoya (parttolly desciccoted milk) 5.0% 4.4% 7.0%

Chhana and Paneer (unprocessed cottage cheese) 3.1% 1.6% 3.0%

Western Products : Milk Powder etc. 3.1% 1.6% 3.0%

* Includes P~stan and Bangladesh

Source: Milky Ways, by Dr. J. V. Parekh, http://www.etfoodprocessing.comJOct_Nov_06/cs01.htm

Dairy products an estimated 54 per cent of India's milk production isconverted into products, both Traditional and Western.

In this, the share of traditional products is about 50 per cent, accountingin 2001 for a little over 42 million tonne of milk, which yields over 10 million tonneof mithais and other related products per year. The growth projections for theirdemand in the organised sector are presented in Table 2.

Table 2Projected Demand for Major Milk Products in the Organised Sector (1988.2009)

(Metric Tonne)

Product Demand 1988 Projected Demand 2009

Ghee 100,000 200,000

Cheese 4,200 15,000

Paneer 1,000 16,000

Shrikhand 3,000 5,650

Rasgulla 1,600 6,000

Gulabjamun 3,000 5,850

Source: Milky Ways. by Dr. J. V. Parekh, http://www.etfoodprocessing.com/Oct_Nov_06/cs01.htm

Sachan (2005) discussed the dairy scenario in India and also highlightedthe export potential of this sector. According to him, higher professionalism couldbe imparted in rearing, milking as also handling during distribution of milk. Lessonscould be learnt by individuals and small dairy farms from the cooperative sector.which has managed to impart some amount of professionalism in its operations.Several areas in the dairy industry could be strengthened by induction of state-of-the-art technologies, transferred from other dairy majors of the world: Operationalefficiencies are required, not only to improve yields but also to reduce waste andminimization of losses in fat, protein during milk processing.

Bhar and Saxena (2005) developed ARIMA models for forecasting thesales of milk and milk products in the regions of Bokaro and Dhanbad. Based onthe data collected from the period from March 2003 to December 2004, they fittedthese models and forecasted for the period from January 2005 till June 2005, andconcluded that they were valid for forecasting the milk sales and retailer growth ofthe dairy (with a 95-percentile confidence level), which will help the dairy companiesto formulate appropriate marketing and distribution strategies.

aYt = 0.488 aYt-I + et - 0.881 &t-l

aYt = 0.220 aYt-l + Et - 0.860 &t-l

aYt = 0.667 aYt-I + &t - 0.489 &t-I

aYt = - 0.045 aYt-I + et + 0.845 &t-l

where Yt is Response (dependent) variable at time t, and &t are error termsthat represent the effects of variables not explained by the model.

Abreu (2000) has made out that thirty years after Operation Flood, whichsaw the country awash in milk, another revolution is in the making: the marketing

and distribution of packaged milk, both plain and in flavoured form, aimed at theburgeoning Indian middle class. There is a strong rationale behind this surge. Onthe supply side, milk production in the country has almost doubled from 38.8 milliontonnes in 1983-84 to 74 million tonnes in 1998-99. Juxtapose this with thedemand side development: A rising number of working couples, nuclear families,need for longer shelf life and changing lifestyles; plus the increased consciousnessof global trends.

Abreu, Robin (2000) in his article on dairy products has prominentlyincluded the following views of Jagdeep Kapoor, R.S. Sodhi, Navin Chopra, B.P.Acharya and Vasudeo Joshi, which have been considered quite relevant andimportant from this research work point of view.

Jagdeep Kapoor, Managing Director, Samsika Consulting said, "What wasonce an ordinary product has suddenly developed into a full-fledged brand war."Clearly, this is one big fat cow waiting to be milked. The dairy products market isestimated at over Rs. 36,000 crore. So, virtually every big player - from Amul andVijaya to Nestle and Britannia - is desperately seeking new strategies to break intothe market that was till now the comfortable stable of n:gional players. But it is notan easy war. Each player has to work within the four well-defmed parameters ofaffordability, hygiene, shelflife and packaging.

R.S. Sodhi, General Manager (Marketing), Gujarat Co-operative Milk andMarketing, summed it up succinctly, "the transition from the ordinary milkman topackaged milk is mainly because people do not want any adulteration. They arewilling to pay more for quality."

Navin Chopra, General Manager (Marketing), Britannia Industries, remarked:"Proving your product is safe and healthy is the biggest hurdle. Once that is done,half the battle is won."

B.P. Ac:harya, Managing Director, APDDCF, pointed out, "Variants are thekey to increase your marketshare. After the introduction of the low-fat Vijaya brandwe have managed to sell one lakh litres in 15 days."

Vasudeo Joshi, Director (Research), HSBC Securities, revealed that "in theFMCG sector, milk and milk products are the growth vehicle of the future". Joshisays that consumer habits are fast changing. "The simple packet of milk hasbecome a pot of gold for most companies," he says.

1. To study the effect of demographic features on the buying behaviour.2. To study the consumer behaviour towards different brands of milk products.3. To study the satisfaction levels of consumers' vis-a-vis various features of

a particular brand.4. Preferential attributes and influencing factors which affect consumer-buying

behaviour of different brands.For achieving the aforesaid objectives, the following Null Hypotheses

were framed:1. HOt: There is no association between income & use of branded milk (Ref.

Table 1).2. H01: There is no association between profession and use of branded milk

(Ref. Table 2).3. H03: There is no association between the age of a respondent and the

choice of a milk product he/she procures (Ref. Table 3).4. H••: There is no association between the purchase of a particular brand

and the factors affecting its choice (Ref. Table 4).5. Hus: There is no association between income level of the respondents and.

the factors affecting the consumer buying behaviour (Ref. Table 5).6. H06: There is no association between Professions of the respondents and

the factors affecting the choice of a particular brand (Ref. Table 6).7. H07: There is no difference in the perception regarding the factors affecting

the buying behaviour of consumers of Patiala versus Ludhiana cities(Ref.·Table 9).

8. Hoa: There is no association between age and effectiveness of media(Ref. Table 10).

For the purpose of study, a sample of 100 respondents was taken usingconvenience sampling technique. The sample was taken from 2 cities, Patiala andLudhiana (50 from each city) and the information was collected throughquestionnaires from the respondents.

The method of scaling was used for studying the buying behaviour ofconsumers. The data was arranged in Crossed Tables for better understanding ofthe relationship between different variables. Chi-Square was used comprehensivelyfor analyzing association among various parameters. Also Z-test (one-tailed) wasused for comparing consumers' perception in Patiala and Ludhiana cities. Thecalculated Z-values were compared accordingly. The formula applied was

z = (PI - pz)~P(1-P)XO.02

Various hypotheses were tested for their validity and legitimacy.cI> Accepted at 5 % Level of Significance;

<I><I> Accepted at 1 % Level of Significance but Rejected at 5%Level of Significance;

; Rejected at both Levels of Significance.Table 3 indicates the relationship between Income level of the respondents

& the use of branded milk. The hypothesis formulated for the purpose was : 'Thereis no association between income & use of branded milk.'

The null hypothesis originally formulated was rejected and hence it canbe held that there is association between Income & use of Branded Milk. Thisindicates that with the variation in the income level, the tendency to swing betweenunbranded and branded milk amplifies.

Table 3

Association Between Income & Use of Branded Milk

Use of Branded Milk

Yes No Both TOTAL

Below Rs.I 0,000 16 14 2 32~;.Q> Rs.10,00G-15.000 4 12 12 28.JQ>e Rs.15,00G-20,000 5 12 6 23=...c Above Rs.20,000 4 5 8 17-

TOTAL 29 43 28 100x2 = 18.58388 ~

(For u = 6, X2 = 12.6 at 95% confidence level and X2 = 16.8 at 99% confidence level.)

Table 4

Profession & Use of Branded Milk

Use of Branded Milk

Yes No Both TOTAL

Home Maker 3 35 22 60c= Student 15 2 0 17';j<II.:!

Service 7 4 2 13=•..=-Businessman 4 2 4 10

TOTAL 29 43 28 100xl = 52.11379 ~

(For u = 6. X2 = 12.6 at 95% confidence level and X2 = 16.8 at 99% confidence level.)

Table 4 reveals an association between profession and use of brandedmilk. The test results indicate that the hypothesis 'There is no association betweenProfession & use of branded milk' has been rejected. Thus, it can be inferred thatprofession does have a bearing on the choice of branded/unbranded milk.

The hypothesis that 'There is no association between the age of arespondent & the choice of a milk product he / she procures' was tested using thedata given in Table 5. The chi-square values in this case show a very attention-grabbing outcome that the hypothesis is accepted at I % level of significance butis rejected at 5% level of significance. The explanation to this result is that associationamong the variables is very susceptible to shift towards either possibility. Twomilk derivatives, i.e., Ice cream & Flavoured milk, in particular are a strongfavourite among the 20-30 age cluster, whilst the remaining milk products areequally distributed among various age clusters. This may be the reason for sucha susceptible swing.

Table 5

Association Between the Age & Choice of Milk Product

Milk ProductlDerivatives

~ .:ol

.;; i i~ 5= •• •• ~i: .. •• •• •• •• i:= .. .. 5 ..... .. •• ..

= = •• r..: •• ~ •• •• = ~...• > '; •• ~ .. •• •• -=•• •• •• -= .. -= .. 011

~ii: •• = •• =~ = - U ll. ... U U >-Below 20 1 1 0 4 0 0 I 0 0 1 8

20-30 I 17 5 21 1 1 5 2 1 2 56a. 30-40 I 2 5 4 3 1 I 1 2 2 22CllI<

Above 40 0 1 1 1 0 1 5 1 1 3 14

TOTAL 3 21 11 30 4 3 12 4 4 8 100

x.2 = 42.70631 <1><1>(For u = 27, X2= 40.1 at 95% confidence level & X2= 47.0 at 99% confidence level.)

Table 6 indicates the relationship between the purchase of a particularBrand & the factors affecting its choice. The hypothesis formulated for the purposewas 'There is no association between the purchase of a particular Brand & thefactors affecting its choice.'

Since the null hypothesis has been accepted, it can be said that thereis no association between the purchase of a particular Brand & the factors

affecting its choice. The results are confirmed by the graph shown below,which indicates that most of the respondents preferred quality aspect of the milkand further Verka heads the list of brailds, followed by Nestle, for this attribute.

Table 6

Association Between Brand & Facton Affecting its Choice

Brands

Verka Nestle Amul Gopika Vita Harman Total

~ Reliability of Quality 15 13 7 2 2 3 42~'S Fat ContentlNutrition 9 3 2 1 0 0 IS.c:~~ Better Packaging 2 5 6 0 1 0 14.c:•..~ Low Priced 2 2 3 1 0 1 9=;

Availability 7 3 3 1 1 0 15~~...

<II Better Taste 0 1 2 0 0 0 3<It..= Family Status 1 1 0 0 0 0 2•..~<II

"'- TOTAL 36 28 23 5 4 4 100

x2 = 22.8972 <1>

(For u= 3D, x2 = 43.8 at 95% confidence level & X2 = 50.9 at 99% confidence level.)

Table 7

Income Level & Factors Affecting the Choice of a Brand

Income Level

Below Rs.IO,OOD- Rs.IS,OOD- Above TotalRs.I0,000 15,000 20,000 Rs.20,000

Reliability of Quality 14 18 8 2 42

~ Fat ContentlNutrition 5 2 2 6 15..:!=.c:

2~ Better Packaging 3 6 3 14~.c:•.. Low Priced 2 3 1 3 9~.:Availability 7 2 4 2 15•...!...Better Taste 0 0 2 1 3<II

<It..= Family Status 1 1 0 0 2•..~<II

"'- TOTAL 32 28 23 17 100

x2 = 28.54748 <1>

(For u = 18, X2 = 28.9 at 95% confidence level & X2 = 34.8 at 99% confidence level.)

Sandeep Singh Virdi et al. "ndian Management Studies Journal II (2007) 105-125

Factors like taste and f.ily status were found to be least preferred while decidingupon a brand.

Table 7 indicates the relationship between Income level of the respondents& the factors affecting the Consumer buying behaviour. The hypothesis formulatedfor the purpose was : 'There is no association between Income level of therespondents & the factors affecting the Consumer buying behaviour'.

The null hypothesis originally formulated was accepted and hence it canbe held that there is no association between Income & the factors affecting theConsumer buyin! behaviour. Though the statistical analysis indicates that there isno association between the variables, but a cursory glance on the table reveals thatthe income groups falling below the range of Rs. 15,000 are more concerned withthe quality of the milk procured.

Ensuing Table 8 indicates the relationship between the profession ofthe respondents & the factors affecting the choice of a particular brand.The hypothesis formulated for the purpose was : 'There is no association betweenProfessions of the respondents & the factors affecting the choice of aparticular brand.'

Table 8

Association Between Profession & Factors Affecting Choice of Brand

Profession

HomeStudent Service Business Total

Maker

Reliability of Quality 24 9 7 2 42Q> Fat Content/Nutrition 11 1 1 2 15...

'C;-=... Better Packaging 10 r 1 2 14Q>.: Low Priced 4 3 1 1 9IlIl

~ Availability 9 2 2 2 15...~.•..

Better Taste 1 0 1 1 3•'"..= Family Status 1 1 0 0 2•.....•~ TOTAL 60 17 13 10 100

x.2 = 13.20124 <1>(For u = 18, Xl '= 28.9 at 95% confidence level & Xl = 34.8 at 99% confidence level.)

The chi-square values show that the hypothesis has been accepted whichindicates that professions of the respondents have no bearing on the factors

affecting the choice of a particular brand. Despite the acceptance of the nullhypothesis we can see that home makers are more disposed towards the qualityof mille This assertion also conftrms the already stated fact that home makersconsider non-branded milk as better quality milk. This belief might have the originfrom the fact that the non-branded milk takes far less time to reach them ascompared to the branded one.

Table 9Scale Analysis of Factors Affecting Buying Behaviour

Score Mean Score Rank

Reliability of Quality 395 3.95 3

Fat ContentlNutrition 450 4.5 I

Better Packaging 215 2.15 6

Low Priced 435 4.35 2

Availability 360 3.6 4

Better Taste 285 2.85 5

Brand Esteem 150 I.S 7

Scale analysis regarding factors affecting the buying behaviour has beendepicted in Table 9 and the corresponding ranks in Table 10. It can be observedthat Nutritional Content & Price factor playa major role in affecting the purchaseof milk/milk products. The respondents have shown the least preference for thefeatures such as Brand Esteem, Packaging and Taste. Tbisconclusion was reachedby the Mean Scores calculated using the Likert Scaling Technique.

Table 10

Rank

Fat ContentlNutrition 1

Low Priced 2

Reliability of Quality 3

Availability 4

Better Taste 5

Better Packaging 6

Brand Esteem 7

The following table, i.e., Table II attempts to verify the hypothesis that'There is no difference in the perception regarding the factors affecting the buyingbehaviour of consumers of Patiala versus Ludhiana cities'.

Table 11

Perception Regarding tbe Factors Affecting tbe Buying Bebaviour of Consumers of

Patiala versus Ludbiana Cities

Factors affecting Patiala Ludbiana P Z

tbe cboice Number PI Number Pz Value

Reliability of Quality 26 0.52 16 0.32 0.42 2.8653~

Fat ContentlNutrition 9 0.18 6 0.12 0.15 1.1881<1>

Better Packaging 3 0.06 11 0.22 0.14 -3.2605~

Low Priced 2 0.04 7 0.14 0.09 -2.4708<1><1>

Availability 7 0.14 8 0.16 0.15 -0.3960<1>

Better Taste 2 0.04 1 0.02 0.03 0.8290<1>

Family Status 1 0.02 1 0.02 0.02 0.0000<1>

Total 50 1 50 1 1 -The test results indicate that the hypothesis has been rejected in case of

quality and packaging factors while the hypothesis has been accepted in the casesof the remaining variables. This shows that consumers' perception differs in caseof quality and packaging in both the cities. For example, in Patiala consumersare more concerned with the quality as compared to Ludhiana city. Whereasconsumers' perception does not differ in case of remaining factors. Consumersthink in the similar manner in case of nutrition, price, availability, taste etc. in boththe cities.

The hypothesis that 'There is no association between Age & effectivenessof Media' was tested using the data in Table 12. The chi-square values show thatthe hypothesis has been accepted which indicates that effectiveness of media hasno bearing on age. Despite the acceptance of the null hypothesis we can see thatrespondents in the age group 20-30 are more influenced by media irrespective ofits type.

Ensuing table (Table 13) portrays the preference for the media among therespondents ofPatiala & Ludhiana. The electronic media, i.e., Television, heads thelist with 38% of the respondents favouring it, followed by the Print media, i.e.,Newspapers and Magazines. These media can be tapped for advertisement purposesby the dairy proprietors. Handouts, Mailers & Pamphlets were the least preferred

Table 12

Age and Effectiveness of Media

Media

» ~011 .S.. Q.~ ~ ••• .•• =.•• oWCl. = Q ~ •• oW ';011 N .. :c .. = ..J

Cl. •.. ~ Q Q., <••• 011 ~ •• Cl. = ~~ ~ :c Cl. e = ~011 Q = -;

~~~

~011 .= to 011 011 011

Z U ~ ::t Q., = :: :;Below 20 6 0 0 2 0 0 0 0 0 0 8

20-30 20 15 10 7 3 0 0 0 0 I 56~ 30-40 4 10 3 2 2 0 I 0 0 0 22~<

Above 40 2 9 2 0 I 0 0 0 0 0 14TOTAL 32 34 15 11 6 0 1 0 0 1 100

'OK = 25.67274<1>(For u = 27, X2 = 40.1 at 95% confidence level & X2 = 47.0 at 99% confidence leveL)

Table 13

Media Efficacy

Media Percentage of Respondents

TV 38

Newspaper 26

Magazine 13

Cable 2

Shop Display 9

Mailers 1

Pamphlets I

Banners 3

Handouts 0

Wall Painting 7

Total 100

and hence are not recommended.Ensuing table (Table 14) indicates the effect of educational qualifications

on the choice of media. The table shows that 66.7% of the Ph.D. respondents readnewspapers. In case of Newspapers & Magazines, as the education level increases,the inclination towards reading them also goes up. But reverse is the case in

Table 14Educational Qualifications and Media

Media>. tillos .5100 Q.•• •• -= '" ==Q, = '" •• '" - .;os 'N is '" := 100 =

~Q, •.. •• = g"

'" os •• •• Q, = "l:l~ till ::ci Q, •• S = =~ •• os os e os S 0z ~ .c: ::; os os = ~ ~u 00 g" ==

Matrie 4 2 - 2 - - - - - - 8(50%) (25%) (25%)

'"10+2 6 1 1 2 - - - - - - 10

= (10%) (20%).2 (60%) 10%)•• Graduate 13 11 13 I 38... - - - - - -5S (34.2 (29%) (34.2 (2.6=0' %) %) %)

S Post 6 18 11 3 I - - I - I 41=.2 Graduate (14.6 (44%) (26.8 (7.3 (2.4 (2.4 (2.4-os...%) %) %) %) %) %)="l:l

'iilPh.D. 2 1 3- - - - - - - -

(66.7 (33/3

%) %)

TOTAL 29 34 26 8 1 0 0 1 0 1 100

Television & Cable channels, where the interest decreases as education levelincreases. Only post-graduates showed interest in Banners & Wall Paintings, eventhough it was a measly 2.4%.

The analysis revealed that there is a strong association between Income& use of Branded Milk, which means that with the variation in income levels thechoice for branded / unbranded milk also varies. It was inferred that there is noassociation between the purchase of a particular Brand & the factors affecting itschoice, thereby meaning that while choosing a brand the consumer does notconsider factors like packaging, price, nutrition, taste etc. Effectiveness of mediahas no bearing on age, that is, age does not affect a consumer's preference for aparticular media. It was construed that profession does have a bearing on thechoice of branded / unbranded milk. There is no association between Income & the

factors affecting the Consumer buying beh~viour, thus, leading to the conclusionthat Income level does not affect consumers' choice regarding quality, packaging,price etc. Profession of a respondent has no bearing on the factors affecting thechoice of a particular brand. There is no statistically conclusive evidence that thereis any association between the age of a respondent and the choice of a milk producthe / she procures as the hypothesis is accepted at I% level of significance but isrejected at 5% level of significance. In this case also the statistical results were notstrong enough to conclude that there is any association between the Income levelof a respondent & the choice of a milk product he / she consumes as here alsothe hypothesis is accepted at I % level of significance but is rejected at 5% levelof significance. Therefore, meaning that association among· the variables is veryprone to shift towards either horizon. The test results indicate that the hypothesishas been rejected in case of quality and packaging factors while the hypothesis hasbeen accepted in the cases of the remaining variables which implies that consumers'opinion in Patiala differ from Ludhiana's consumers regarding the quality andpackaging aspect.

As it was found that income and profession does affect the choice ofbranded or unbranded milk, marketers can target particular income and professiongroups for promoting their brands. Awfully it was seen that factors like packaging,price, nutrition, taste etc. do not affect choice of a particular brand.

Though it is by and large the housewife who plays a role in branddecision, but sometimes the male members do playa role and hence the marketersare advised to focus on the entire family.

Also, due to progression in technology, several varieties of milk are availablein the market such as whole milk, skimmed milk, toned milk etc. Again, there is astrong felt need for the marketing managers to dwell on creating a high degree ofawareness among the customers regarding their product range.

So, marketers should search for factors that do affect the choice of a brandand focus their promotion strategies and investment on these newly revealedfactors. Customers are more apprehensive regarding the quality and packaging ofthe milk in Patiala district rather than in Ludhiana district and this fact should bekept in mind while framing strategies for retaining customers in Patiala. Whilechoosing a media, a marketer can rely on TV.and newspapers for reaching hiscustomers and further age of the target customer should not be a deciding factorin the choice of media.

Dairy companies, particularly in Punjab, will have to spend lot of effort on

advertising and other promotional activities. Milk companies are also advised tostrengthen their supply chain and other logistics and use intermediaries to promoteand make their products available to the end consumer.

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