Minor Project Synopsis

On

Factors Affecting Purchase Decision of Bikes in Youth

Submitted by

Nishkarsh Maurya Shraddha Joshi

Under the supervision of

Prof.Dr.Amar Tiwari Asst.Prof Miss Jagriti Mishra

Submitted to

Department of Master Of Fashion Technology(M.F.Tech) National Institute of Fashion Technology (NIFT)

(Ministry of Textiles, Govt. of India) GH-0 Road, Behind Infocity
Gandhinagar 382007. Gujarat http://www.nift.ac.in January , 2013

Factors Affecting Purchase Decision of Bikes in Youth Background The two-wheeler industry in India has grown rapidly in the country since the announcement of the process of liberalization in 1991 by the then finance minister Dr. Manmohan Singh, now Prime Minister of India. Previously, there were only a handful of two-wheeler models available in the country. Currently, India is the second largest producer of two-wheelers in the world. It stands next only to China and Japan in terms of the number of two-wheelers produced and the sales of two-wheelers respectively. In the year 2009-2011, the annual production of twowheelers in India stood at around 7600801 units. The trend of owning two-wheelers is due to a variety of facts peculiar to India. One of the chief factors is poor public transport in many parts of India. Additionally, two-wheelers offer a great deal of convenience and mobility for the Indian family. Bajaj auto began trading in imported Vespa Scooters in 1948. Meanwhile Automobile Products of India (API) commenced production of scooters in the country in the early 50s. Until 1958, API and Enfield were the only producers of two-wheelers in India. However, Bajaj signed a technical collaboration in 1960 with Piaggio of Italy to produce Bajaj Scooters. This research covers the factors that influence buying decisions of consumer in bikes. It includes Factors that make his/her to buy a particular bike. The factors describe pre-purchase and post Purchase behavior. Statement of the Problem Bikes market has a great potential and already has a huge market size when it comes to the indian vehicles market. The research is aimed to find out the main buying factor which influence towards the buying decision of motor cycle, choice of brand,color,style,look,budget limitation, mobility convince, parking problem, and maintenance at low cost.

Review of Literature The Customer Perception Report includes questions in four key areas, Expectations, Purchase Decisions, Customer Service, and Future Purchases. So the customer should be invited to participate in the survey. Setting realistic expectations during the sales process is a vital component of making happy customers. How a company sets and meets product and service expectations plays a pivotal role in fashioning customer opinions. How a company meets or

exceeds expectations is measured in three important areas: product/service, support, and price. These three areas will be used to factor a score for the Expectations category. The results of the three questions will be used to factor an overall expectations perception score. The Purchase Decision category gives us a better understanding of how the customer perceives the purchase process. Two key areas for questions include an open ended question on why they purchased and a ratings question on their experience. The rating Question data will be used for the analysis of Purchase Decision category. The open ended responses from the Why questions will be used for product strengths analysis. The results of the purchase experience question will be used for the overall Purchase perception analysis. Customer service is one of the most important differentiations a company can have. For this report, customers will rate a company in three key areas: customer service, timeliness for problem resolution, and expertise. These three areas will be used to factor a score for the Customer Service category.

Hero Honda: The leader of the industry for a long time now, continues its dominance with a huge gap. They reported an impressive 30.39 percent rise in sales compared to July 2011. Hero Honda sold 3,66,808 motorcycles compared to 2,81,317 sold in July 2011. The company reported a huge jump of 83.28 percent in its net profit at Rs. 500.11 crore for the previous quarter ended June 30. Net profit for the first quarter for the last fiscal was at Rs 272.87 crore. With a domestic market share of more than 59 percent, Hero Honda is in the strongest position in the history of Indian market claimed Pawan Munjal, CEO and MD of Hero Honda. With each passing month the strength of the brand gets even stronger and with the companys concentration on volume selling models, it is expected to just grow bigger. Forthcoming launches expected from the company are ultra low cost 75cc and 110cc fuel efficient bikes which would be priced at Rs. 20,000 along with the much touted upgrade for Karizma.

Bajaj Auto: After some dismal sales for the past few months, July was easily the best month for Bajaj. The company reported almost a negligible drop in sales. Bajaj sold a total of 1,92,835 vehicles this month as compared to 1,93,704 sold in July 11 with a positive change in the total vehicles exported which stood at 68,585 units in July 10 as compared to 67,253 units last July. Individually, Bajaj sold 1, 68,163 motorcycles compared to 1, 68,836 sold last July and a total of 1,68,731 two wheelers against 169,971 in July 08. With some good results coming their way,

Bajaj announced an increase in their Pulsars production capacity to 50,000 bikes per month last month. This month, owing to good sale figures and good future prospects along with some dashing recent bikes in the market, Bajaj has announced an increase of domestic motorcycle production by about 25 percent in the forthcoming months. Bajaj reported that they sold about 10,000 units of the latest 100cc Discover DTS-Si already which was launched on 17 July 2011 and the plans for August are close to 20,000 units. It also reported that with some fantastic launches recently Bajaj has been able to match their year on year sales for the first time after the downturn last year. The company is also expected to launch a new entry level commuter bike along with Avenger getting the 220cc DTSi engine from the Pulsar 220 DTSi, though there is still no word on the launch of the much awaited Kawasaki Ninja 250R.

TVS Motors: Standing third in terms of motorcycle sales in India is the Chennai based TVS Motor Company which posted a 2 percent increase in July 2011. TVS sold 1, 20,994 units as against 1,18,545 units sold during the same month last year. If we talk about the domestic sales, TVS sold 1, 07,883 units in July 09 as compared to 1, 02,530 units in July 2008 registering a 5 percent growth in sales. Due to a strong demand for the recently launched Apache RTR 180 and Flame SR 125, motorcycles contributed the majority of sales contributing 42,998 units in July 11 but were lower than July 08 wherein the company sold 54,042 units. With the recent launch of TVS Scotty Streak, which contributed a significant part to the overall scooter sales, the total scooter sales increased by a healthy 15 percent with 27,673 units in July 10 compared to 24,156 units sold during July 08. Contrary to the case of Bajaj (where exports have become stable), TVS reported a drop in sales selling 13,061 units of two wheelers in July 2011 against 16,015 units sold in July 08. Forthcoming launches from TVS are expected to be concentrated on the entry level commuter segment and scooters along with a powerful bike.

HMSI: Honda seems to be on a rampage with both of its arms registering impressive growth over the last few months. HMSI recorded its highest ever monthly sales of 1,12,855 units, compared to the 85,343 units sold during the same month last year which included domestic and exports marking an impressive hike of 32.24 percent in total sales. The newly revamped Activa

seems to be spreading the same magic as its earlier predecessor did which helped HMSI sell 67,107 units of scooters with Aviator and Dio also adding a bit to the overall pie. Last July, this figure stood at 57,620 units. Motorcycle sales rose to a new high of 45,748 units compared to the 27,723 units sold in July 11, which were a significant 65 percent higher than July 11. Combined sales of Hero Honda and HMSI were close to 4.8 lakh units which clearly indicate the sort of a premium and trust the biggest brand in the world commands in India. Future launches from HMSI are expected to be a premium 100cc bike which would help the company further in their sales.

Yamaha: It seems like Yamaha has stuck the right chord among the youth with its ultra-stylish series of bikes. For many months now, they have been registering a growth in sales, negating the effect of the fact that their bikes are priced at a premium and are targeted more towards the image conscious and performance seeking crowd. This month Yamaha Motor India (IYM) reported a 46.85 percent increase in sales at 17,316 units compared with the 11,792 sold during July 08. Yamaha launched the new variant of the FZ series, the Fazer, this month along with inaugurating a new manufacturing facility at Surajpur, Uttar Pradesh. Forthcoming launches are expected to be more concentrated towards the volume and premium 125cc segments.

Suzuki: Suzuki, the youngest player in India, also recorded an impressive increase in sales of 20.35 percent this July which stood at 12,585 units compared with 10,457 units sold during July 08 majorly lead by the perfectly positioned GS150R. Scooter sales also increased where Suzuki has the 125cc Access. Social Factors Reference Group A persons reference groups consists of all the groups that have a direct or indirect influence on the persons attitudes or behaviour. Family The family is the most important consumer buying organization in the society and it constitutes the most influential primary reference group. Roles and statuses A person participates in many groups, family, clubs, organizations etc. The persons

position in each group can be defined in terms of role and status. A role consists of the activities that a person is expected to perform. Each role carries a status. Personal Factors Age and stage in the life cycle People buy different goods and services over their lifetime. Taste in clothes, furniture and recreation is all age related. Consumption is shaped by the family life cycle. Marketers often choose life-cycle groups as their target market. Occupation and economic circumstances Occupation also influences a persons consumption pattern. Product choice is greatly affected by economic circumstances; spendable income, savings and assets, debts, borrowing power and attitude toward spending versus saving. Lifestyle People from the same subculture, social class, and occupation may lead quite different lifestyles. A lifestyle is the persons pattern of living in the world expressed in activities, interests and opinions. Lifestyle portrays the world person interacting with his or her environment. Personality and self concept Each person has a distinct personality that influences buying behaviour. It is that distinguishing psychological characteristics that lead to relatively consistent and enduring

Purpose of Literature Review Literature review is one of the prime parts of every project. The very basic purpose of the literature review is to gain insight on the theoretical background of the research problem. It helps the researcher to gain strong theoretical basis of the problem under study and also help to explore whether any one has done research on the related issue. Thats why literature review helps one to find out the path of problem solving. In this regards the very basic purpose of the literature review in this dissertation is same as mentioned

Need of the study We observed that in a last few decades, peoples are mostly liken to acquire the motorbikes for daily usage, and we also observed due to this buying trend so many new companies arrive in India to introduce new brands in India Market. There is no doubt that the old companies market share is falling down. So this study will help to understand and identify what the consumer feels or perceives about motor bikes. This will help the marketer to identify which all are the factors that a consumer looks in to when he selects a particular bike. And also explains how a consumer selects and interprets the qualities of bike.

Objectives of the Study The research has been undertaken with following hypothesis: 1. To analyze consumer perception towards various motor cycle brands 2. To study the various factors affecting purchase decisions of motorcycles.

Methodology The research will be done through survey method. The collection of data will be done through, focus group interview. The sample size taken for this research is 20 customers those who are having motor bikes. The collection of data will be done with the help of focus group interview. The designing of questionnaire needs precision and classification of the subject, so that the respondents can easily understand the question and can answer it sincerely and correctly.

Sources of Data Primary data:Primary data consists of original information for the specific purpose at hand. It is first hand information for the direct users of respondents. The tools used to collect the data may vary and can be collected through various methods like questionnaire, personal interview

Secondary data:Secondary data is the data which is already been collected and assembled. This data is available with the companies or firms and it can be collected from newspapers, periodicals, magazines, websites etc. Sample Design Sampling Technique Convenient Sampling technique is used for this assignment. Data Collection Tool Focus group discussion and survey will be used for collecting data. Statistical techniques 1. Bar Diagrams 2. Pie-Chart Scope of the study The study helps in generating awareness regarding customer satisfaction towards motorbike usage. As the vehicle is a convenient transportation mode in India, this study will help us to understand the characteristics of the motorcycle market . It will also be helpful to various motorcycle retailers in order to understand the factors preferred while a bike purchase. This inturn will also help in marketing and strategy formulation for the retailers Findings The old prophecy that once a customer is a customer has become a myth in the present days competitive world. Brand image is still a magic with the consumer. So to hold the customer to the brand and attract new consumers the companies must produce products those are efficient and competent along with its marketing activities that help in sales of the product. After analyzing the response of the consumers interviewing through focus group and observation the following were found in the study. Now a days the main customers are youngsters between 20-30 years of age. Customers using motorbikes have almost monthly income between 10,000 and 20,000. Bikers are influenced to make acquiring decision from friends and relatives. Also an advertisement plays a vital role in influencing the consumers. The greater part is that the customers have complete knowledge about motorbike before customer buys a motorbike.

 The majority of respondent are using bikes for personal purpose as well as professional purpose. Motorbikes performance is good revealed by their personal experience of using the bike. The motorbike customers will get satisfied about the availability of its spare parts post purchase. Most of the consumers those who participated in the survey ranked Quality. Look and Power as most attractive attribute of motorbikes. The performance of motorbikes is one of the influencing factors for the customers to buy a bike. The customers preferred acquiring selected brands. The customer wants that company should provide post sale service to the motorbikes. The customer prefers that expert mechanics should be easily available. The customers prefer local mechanics for maintenance and service of their bikes as compared to service centre of motorbikes.

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