MARKETING CONSUMTION PATTERN

Definition:

The combination of qualities, quantities, acts and tendencies characterizing a community or human group's use of resources for survival, comfort and enjoyment.

1. Introduction The household consumption surveys carried out by the National Sample Survey (NSS) are now in the public domain. In particular, the large consumer expenditure samples are available over 4 time points covering almost 2 decades, 1983 to 1999-00. Prior to the availability of this data, much of the research was confined to aggregate variables and it was difficult to study the consumption patterns (and hence, the well-being) of micro households. The study of household behaviour is essential for social welfare policies and, this data should therefore serve a useful purpose. The objective of this study is to identify some important estimates of how households behave. It is a purely statistical exercise, suggesting what can be done, rather than what should be done. In particular, it is not an econometric exercise. It is more of an exploratory trip, trying to identify issues that are worth examining in a more rigorous fashion. In particular, we do three types of exercises. First, we derive the empirical distributions of consumption over the four time points, 1983, 1987-88, 1993-94 and 1999-00. Second, we construct the proportions of expenditure on various commodity groups, by sector and state for the different years. And finally, we calculate the NSS estimates of total expenditure for each of the commodity groups and compare them to what is reported in the National Account Statistics (NAS).

Consumtion Pattern of Coffe and Tea.

Production and distribution of coffee and tea
The Worlds total production of coffee is around 6 million tons and is leaded by Brazil which has more than 30 per cent share in the Worlds total production; Vietnam and Columbia follow Brazil, respectively. The major consuming and importing countries of coffee are United States, Canada, Japan and European countries like Germany, Italy, United Kingdom, Poland and Spain. Other than the above mentioned countries it is also imported by the African countries. The net imports of coffee figures around 4.5 million tons. The major share of exports in the World is also held by Brazil followed by the other leading production countries like Columbia, Indonesia, Uganda, etc. There are around 25 varieties of coffee under Coffea known to the World. But only two of these varieties, coffea arabica and coffea canephora (or coffea robusta) are very much

popular and are widely used throughout the World. About 70 per cent of the coffee production is constituted by coffea arabica and 25 per cent by coffea robusta. Coffea arabica is largely produced by Brazil and Columbia and is known for its best quality. India stands 6th in the list of coffee producing countries, but contributes only 4 per cent of the Worlds coffee production. The production of coffee in India fell drastically in 200203 like in the other countries of the World but started recovering slightly in 2003-04. Coffee production during 2005-06 was about 2.74 lakh tons and was estimated at 3.0 lakh tons for the year 2006-07. A total quantity of 2.02 lakh tons of coffee was exported from India during the year 2005-06, valued at 349 million US dollars, earning a foreign exchange of Rs.1510 crore. At present India produces about 5 Million Bags of coffee. Local consumption of coffee is about one million bags; and rest is exported. The areas having a good altitude are covered by coffea arabica and the low-lying areas having a hot climate cultivate coffea robusta. Robusta coffee production contributes about 65 per cent of the total coffee production, whereas Arabica contributes about 35 per cent. Karnataka has the maximum cultivated area (53 per cent) under coffee. Karnataka is the largest producer of coffee in the country and accounts for 56.5 per cent of total coffee production in India. According to the FAO report, tea production in 2004 has reached a record 3.2 million tonnes, a 2 per cent increase compared to 2003. China, the second largest tea producing country, produced 800,000 tonnes of tea and exported 280,000 tonnes to other countries, of which over 75 per cent is green tea. In the next decade, FAO expects the World green tea production to grow at a faster rate than black tea at 2.3 per cent a year, but volumes are much smaller at a projected total of 975,000 tonnes by 2014. The growth is mainly driven by the health benefits of green tea consumption. Tea industry in India is about 170 years old. It plays a crucial role in the national economy. Robert Bruce in 1823 discovered tea plants growing wild in upper Brahmaputra Valley. In 1838, the first Indian tea from Assam was sent to United Kingdom for public sale. Thereafter, it was extended to other parts of the country. However, owing to certain specific soil and climatic requirements its cultivation was confined to only certain parts of the country. Tea plantations in India are mainly located in rural hills and backward areas of Northeastern and Southern states. Major tea growing areas of the country are concentrated in Assam, West Bengal, Tamil Nadu and Kerala. The other areas where tea is grown to a small extent are Karnataka, Tripura, Himachal Pradesh, Uttaranchal, Arunachal Pradesh, Manipur, Sikkim, Nagaland, Meghalaya, Mizoram, Bihar and Orissa. Unlike most other tea producing and exporting countries, India has dual manufacturing base. India produces both CTC and Orthodox teas in addition to green tea. The weightage lies with the former due to the domestic consumers preference. Orthodox tea production is basically dependent on the export demand. Production of green tea in India is small. The competitors to India in tea export are Sri Lanka, Kenya, China, Indonesia and Vietnam.

Consumption trend of coffee and tea

Coffee consumption in urban markets in India is estimated at around 55,000 tonnes annually, excluding those under the age of 15 years and captive consumption by the armed forces, according to the first comprehensive survey on coffee consumption in India. The "Coffee Consumption in Urban India 2001" report was commissioned by the Indian Coffee Board to better understand coffee drinking habits and practices, coffee demand by location

and preparation method, the daily share of coffee within the overall beverage sector, attitudes towards coffee and opportunities for and barriers to coffee consumption. The Indian survey shows that penetration of coffee as a beverage is high at 82 per cent compared with the 93 per cent rating for tea, which is the dominant beverage even in the traditional coffee areas of Southern India. Three out of four adults across India had consumed instant coffee at least once in a year, while roast and ground coffee has a penetration of 19 per cent. Per capita consumption of coffee in India is estimated at 0.5 cups as opposed to 2 cups for tea, with coffee drinking being practically non-existent in the north and east. Annual tea consumption varies from country to country, with the highest consumption of 2.3 kg per capita in UK. World consumption is approximately 0.56 kg per capita. Green tea is the primary form consumed in China, Japan and some Middle Eastern countries. Tea is an essential item of domestic consumption and is the major beverage in India. Tea is also considered as the cheapest beverage amongst the beverages available in India. Tea Industry provides gainful direct employment to more than a million workers mainly drawn from the backward and socially weaker sections of the society. It is also a substantial foreign exchange earner and provides sizeable amount of revenue to the State and Central Exchequer. The total turnover of the Indian tea industry is in the vicinity of Rs.8000 crores. India consumes the largest quantity of tea in the World, accounting for nearly 14 per cent of global retail volume sales. Geographically, tea is widely consumed in the North, East and West of India. It is popular with a wide variety of social classes and consumer age groups. Tea is the most traditional and affordable beverage in India and it is perceived as being old fashioned and less functional than some substitute products. As per the Tea Board of India estimates, tea was consumed domestically to the tune of 511 mn kgs during 1991, and during 2005, it was estimated to be consumed to the tune of 757 mn kgs. However, it ranks 7th in value terms, due to relatively low unit prices. Black standard tea constitutes nearly 80 per cent of value sales, although green tea has seen its popularity rise. Malt-based beverages such as Horlicks (GlaxoSmithKline) and Bournvita (Cadbury Schweppes), are the favourite type of hot drink in the South, and are also the fastest growing. This drink is consumed as a substitute for milk in this milk-deficient region, and is favoured for its functional benefits. Furthermore, in the south, coffee is bigger as a proportion of total hot drinks than in the rest of the country. Local preferences are different in the south, India's main coffee-producing region. Soft drinks such as carbonates also represent a significant threat to the ongoing dominance of tea in the longer-term, with aggressive marketing campaigns from leading multinationals successfully persuading many young consumers to migrate from tea to soft drinks for various drink occasions. The development of tea bars and coffee shops will encourage out-of-home consumption. Tea bars offer a wide selection of teas at premium prices and are considered fashionable among a certain Indian demographic. Hoping to emulate the success of coffee shops witnessed in many major cities, including in emerging markets, they mainly target expatriates, the corporate entertainment market, or high income locals keen to show individual tastes.

Health benefits of coffee and tea

In recent decades, some 19,000 studies have been done examining coffee's impact on health. And for the most part, their results are as pleasing as a gulp of freshly brewed Breakfast Blend for the 108 million Americans who routinely enjoy this traditionally morning -and increasingly daylong -- ritual. In practical terms, regular coffee drinkers include the majority of U.S. adults and a growing number of children. Drinking a cup of coffee is helpful in counteracting sleepiness during the day and also mental sluggishness, brought about by prolonged concentration and mental effort, such as in a repetitive job. More importantly, caffeine has been shown to induce a positive effect and it is this ability to lift an individuals mood that makes coffee an important source of pleasurable activity and individual happiness. Like the much publicized green tea, which has garnered considerable attention due to its high antioxidant content, researchers have found that coffee is quite high in antioxidants. Coffee may help to manage asthma and control attacks when medication is not available and stops headache, boosts mood and even prevent cavities according to a recent study. Recent research shows that any tea derived from camellia sinensis has cancerfighting properties. The leaves of this plant contain chemicals called polyphenols which gives antioxidant properties. Tea also has fluoride for strong teeth, virtually no calories, and half the amount of caffeine found in an equally-sized cup of coffee. Drinking black tea may lower the risk of heart disease because it prevents blood from clumping and forming clots. In a recent study, researchers found that while drinking black tea, the participants had lower levels of the blood protein associated with coagulation. Green tea, rich in antioxidant treasures that protect against heart disease and cancer, now shows promise as an allergy fighter. To sum it up - by drinking 2-4 cups a day of tea, you can reap in the numerous curative and preventive tea benefits. In the present context, consumerism is gaining more importance and the market researchers are concentrating more on the tastes and views of the consumers. Not many studies have been conduced to understand the preferences of the consumers, hence this study would be able to guide the researchers towards understanding the consumers regarding their preferences for coffee and tea. Keeping all these points in view, a modest research attempt has been made to study the consumption behaviour of coffee and tea in Karnataka, with the following specific objectives.

Objectives of the study

1. To study the consumption pattern of coffee and tea in Karnataka. 2. To examine the socio-economic factors influencing the consumption of coffee and tea in Karnataka. 3. To analyze the consumer preferences for different brands of coffee and tea and their quality traits. 4. To study the health related issues associated with consumption of coffee and tea.

Factors influencing consumption

Gluckman (1986) studied the quality preferences for wine in Europe. The attributes were classified into two, namely, explicit factors and implicit factors. Explicit factors included brand name, price, quality and taste. Implicit factors identified through extensive questioning were colour and appearance. The results of the study revealed that most consumers preferred white wine to red. Packaging, appearance, colour and graphics were the attributes considered very important by the consumers. Haripuram et al. (1986) conducted a consumer preference analysis of biscuits using a sample of 470 consumers. From the study it was found that consumers gave the first preference to taste. Freshness, crispness, brand price and availability, in that order, were the other attributes which were given importance to by the biscuit consumers. Kumar et al. (1987) analyzed the factors influencing the consumption of various food products, using a sample of two hundred respondents. Country of origin and brand were cross-tabulated against age, gender and income. Results of the study revealed that brand image was the most important factor that influenced their consumption. The consumers considered country of origin less important. Inamke et al. (1995) conducted a study to identify the factors influencing the milk consumption behaviour of urban and rural consumers in western Maharashtra. The results indicated that, for both, urban and rural consumers, family income was the factor that most significantly influenced milk consumption. Family size and occupation were the other significant factors. Singh et al., (1995) studied the factors influencing consumer preference for milk. He found that milk quality, convenient availability, supply in desired quantity, flavour, colour, freshness and mode of payment showed higher levels of consumer satisfaction. Hugar and Vijay Kumar (1996) in their study on the factors influencing the consumption of vegetables in Dharwad district of Karnataka, revealed that education level and gender had significant influence on the quality and frequency of consumption as females purchased more when compared to males. Income and price also had a significant influence on the quantity purchased. Poonam Sharma (1997) in her study found that the demand for cut flowers was significantly influenced by education of the respondents, expenditure on entertainment by consumers, frequency of cut flowers purchased by consumers for own use and monthly income of the consumers family. Sharma (1997) conducted a study to determine the factors influencing food consumption in general. The results indicated that price was an important factor which influenced the consumers choice of food items. Other factors like sensory attributes, regional preferences, age, gender, interest, motivation, discrimination and income also influenced food consumption. Amitha (1998) studied the factors influencing the consumption of selected dairy products in Bangalore city. The results of the study indicated that income and price were the factors that significantly influenced the consumption of table butter. Price had a negative impact and income a positive impact, on consumption. The consumption of ghee was positively influenced by income, price and family size. Cheese, just as in case of table butter, was influenced by its price.

Hanumantha Rao (2000) identified the factors influencing the higher per capita consumption of cereals in rural areas. They were; higher prices of non-foodgrain and nonfood items, higher energy requirement due to heavy manual labour, payment of wages in kind by the large farmers in the form of cooked food, and the poor state of healthy and environmental resulting in low efficiency of conversion of food into energy.

Consumption pattern
Puri and Sangera (1989) conducted a survey to know the consumption pattern of processed products in Chandigarh. Jam was found to be the most popular among the respondents irrespective of their income. The consumption of orange squash was highest in high and middle income families. The consumption of pineapple juice increased with rise in income of the respondents. Gursharn (1995) in his study on consumption of walnut found that family size, family education and disposable income of the family were the factors affecting its consumption. Furthermore, per family consumption of walnut increased with the increase in income group. It was 3.11 kgs in the poor class and 13.08 kgs in the rich class. Daisy et al. (1999) conducted a study on consumption pattern and consumer preference for milk products in Madras city. The results of the study revealed that family size, monthly income and education levels had a significant and positive influence on consumption of milk and milk products. Furthermore, the preference of the households was found more for toned milk in all income groups. The preference for other milk products like standardized milk, skim milk and skim milk powder, table butter, cooking butter, khoa and yoghurt increased as income increased which was due to the higher educational level of the head of the household. Apoorva Palkar (2004) studied the consumer preferences in purchase of ready to eat snacks-branded potato chips. Random sampling technique was employed covering 150 consumers and 50 retailers. The results revealed that nearly 60 per cent of the consumers prefer Lays to Peppy, Cheetos and Kurkure. The spicy and the salty flavors were found to be most preferred in chips consumers and they said that taste or time pass was the most important reason for purchasing chips. Nearly 66 per cent of the consumers purchase the products at least once in a week. Consumers prefer to purchase once or twice a week. The habitual purchasers buy Lays brand indicating the loyalty of the consumers. Radhakrishnan (2004) conducted a study on perspectives and prospects of coffee consumption in India. The result indicated that coffee consumption had shown an annual average growth of 2.14 per cent between 1951 to 2003. In absolute terms the off take in domestic market had grown from about 18, 400 tonnes to about 70, 000 tonnes during 2003. For various reasons the decade between 1991 to 2000 did not show any noticeable growth in consumption. Most of the earlier growth had come from Robusta than Arabica. Though, during the pool marketing, the period between 1981-90 showed higher volume of consumption (well above 50, 000 MT and peaked about 63, 000 MT) and the highest growth rates were achieved only during the period 1951-1960 and 1971-1980 at a CGR of 7.23 and 3.28 per cent, respectively. Market development in non- traditional areas, consolidating traditional markets, retail space: outlets and distribution, product forms, consumer education and focus on the youth were some of the policies implied by him. Randhwa and Chahal (2005) conducted a study on consumption pattern of milk and milk products in rural Punjab. The study was conducted to examine the consumption pattern of milk and milk products and to investigate the factors affecting their consumption in rural Punjab. The requisite data was collected through personal interview method by adopting

multistage sampling technique. The results showed that the expenditure elasticities were 0.89 and 0.65 for liquid milk and for milk products, respectively. Sarker et al., (2005) in their study on the consumption pattern, marketing channel and prices of spices in the panchayat samities of West Bengal, indicated that, of the total consumption, turmeric stood the highest in dust, i.e., from 65.63 per cent to 67.63 per cent among the spices, turmeric solid was also consumed significantly, i.e., 13.53 per cent to 15.40 per cent, followed by cumin (8.44 to 8.86 per cent) and chili (8.44 to 8.86 per cent). It was reported that the consumption of spices was highest in winter season compared to other seasons of the year. Amy and Alka (2006) studied the household food consumption pattern in north eastern states of India. The results of the study revealed that the per capita consumption of cereals was 13.17 kgs in rural areas and 13.28 kgs in urban areas of north eastern states as compared to all India consumption of 10.72 kgs and 10.42 kgs in rural and urban areas, respectively. Rice contributed to more than 90 per cent of total cereal consumption in the region. The share of rice in total cereal consumption was found nearly two times higher than that of all India average, whereas the share of wheat and coarse cereals was found to be very low. The per capita consumption of pulses, milk and milk products, fruits, edible oils and sugar were relatively lower in north eastern states as compared to the all India average, but the consumption of vegetables were relatively higher. Jabir Ali (2006) conducted a study on structural changes in consumption and nutrition of livestock products in India. The study revealed that the consumption pattern in India had undergone significant changes towards high value commodities like fruits and vegetables, milk, meat and egg due to increase in per capita income, urbanization, changes in lifestyle, preference, relative prices and increased awareness about food nutrients among consumers. During 1983 to 1999, consumption of cereals declined from 192 to 152 kg per year in rural areas and 147 to 125 kgs in urban areas. But, on the other hand, consumption of fruits increased by 553 per cent, vegetables by 167 per cent, milk and milk products by 105 per cent and of meat, eggs and fish by 85 per cent in rural areas over the same period. These changes in diet were even more dramatic in urban areas. Mahajana Shetty et al. (2006) conducted a study on consumption pattern and consumer preference of milk and milk products in Hubli-Dharwar urban conglomeration. A multi-stage sampling procedure was followed for the selection of the respondents. Households preferences for the attributes of liquid milk were studied using conjoint analysis. The important attributes of liquid milk that influenced the consumers decision to purchase liquid milk were identified in consultation with a sample of decision makers of liquid milk consumption across different households in the twin cities. While liquid milk was used by all the households; curds, butter, ghee and paneer were used by 87 per cent, 53 per cent, 44 per cent and 29 per cent families respectively. The results of the study revealed that the percapita expenditure incurred on liquid milk and the use of liquid milk for drinking purpose increased with increasing family incomes. The results of conjoint analysis indicated that price was of maximum relative importance and brand was of minimum relative importance in the overall decisions regarding the purchase of liquid milk. They concluded that milk of any brand needs to be price competitive with good fat content in that urban conglomeration. Soe and Singh (2006) conducted a survey on households food consumption pattern in north eastern states of India. The study examined the level and pattern of household food consumption pattern. They estimated the expenditure elasticities and projected the household food consumption. The analysis indicated clearly that north eastern states consumed much lower quantities of food items like pulses, milk and milk products, edible oils and fruits as compared to all India averages and recommended levels. Projected household demand for

the year 2016 based on 7 per cent growth in net state domestic product (NSDP) suggested the substantial increase in food demand, which necessitates more capital investment in agriculture including greater financial support to research and extension. Sangeeta et al., (2007) studied the consumption pattern and consumer satisfaction for milk and milk products in urban Punjab. The results indicated that the family size was the major variable for determining the demand for food items both at family level and at aggregate level. Whole milk was consumed by 99 per cent while only 17 per cent preferred skimmed milk. Income of a family affected the consumption levels of milk and milk products as it enhanced their purchasing power of a family. Per capita consumption of whole milk was highest for the business category (954 ml), which included those who were self employed; followed by that for the service category (635 ml) and the house wives (559 ml). The study concluded that per capita consumption of milk and milk products showed a positive relationship with income level, occupational structure and the literacy levels, while it was negative with the food habits. Variation in the consumption levels of milk and milk products across different socio-economic groups implied that the designing of a uniform policy and treating the entire population as one homogeneous group could mislead the marketers. Yesodha Devi and Kanchana (2007) conducted a study on consumption pattern and consumer preference for processed chicken in Coimbature city. Simple random sampling was adopted in selecting the respondents from Coimbature city in Tamil Nadu. The results indicated that, of the 200 respondents selected for the study, 65 per cent consumed chicken once in a week and 62 per cent of the respondents preferred broiler chicken. It was also evident that 60 per cent of the respondents preferred to consume non-vegetarian items from hotels. The study found that the personal factors of the respondents have no significant influence on the quantity of the chicken purchased per week. It was concluded that age, occupation, religion, income level and number of members in the family have significant influence on the quantity of chicken purchased.

METHODOLOGY
This deals with the description of the study area, the sampling techniques adopted, method of survey, the nature and source of data and the various tools and techniques employed in analyzing the data in evaluating the objectives. They are discussed under the following heads. Description of the study area Sampling design Analytical tools and techniques employed

Sampling design
Sampling is the procedure of drawing representative samples from the population for the study. Whatever inference is obtained can be used for inductive reasoning of the population. Samples should always represent the population and the size of the sample must be adequate to draw meaningful inference about the population. 3.2.1 Sample selection To study the consumer behaviour towards consumption of coffee and tea, a multi stage sampling technique was adopted. In the initial stage, north and south districts of Karnataka were chosen for the study. Bangalore and Kodagu were selected from the south and Dharwad as well as Belguam districts were selected from the north, to study the difference in Karnataka, with respect to coffee and tea consumption. In the next stage, the

district headquarters and two villages was selected from each district. Following this, thirty sample households were selected randomly from the district headquarters and was considered as samples from the urban region; and from the two villages fifteen sample households were selected at random and were considered as samples from the rural areas. From Bangalore district, Nelmangalla and Kengari were selected as their rural counterpart. Kalur and Murnad village from Kodagu; Yethinagudda and Narendra from Dharwad; Wadagao and Sulebhavi village from Belgaum district were selected for the study. Totally, from each district sixty samples were gathered, accounting to 240 sample households from where information regarding their consumption behaviour towards beverages* was studied using a well structured and pre-tested schedule. From these 240 sample households, information on 932 respondents was obtained. To study the health aspects associated with the consumption of coffee and tea, 20 doctors were interviewed. Five doctors from each of the four districts were selected for the study. A well structured schedule was formulated and used to interview the doctors to obtain the required information.
Features of the study area Sl. No. Particulars unit Karnataka Bangalore Kodagu Dharwad Belguam General features 1 Total area Sq. kms 191791 8005 4102 4260 13415 2 Number of districts no's 27 - - - 3 Number of sub districts no's 176 12 3 5 10 4 Number of villages no's 29406 2572 296 379 1270 Demographic features 1 Population Mn 52.85 8.40 0.54 1.60 4.21 a. Males Mn 26.89 4.38 0.27 0.82 2.15 b. Females Mn 25.95 4.02 0.27 0.78 2.06 2 Decadal growth rate Per cent 17.51 23.5 12.00 17.00 17.00 3 Sex ratio no's 965 931 996 949 960 4 Literacy rate (total) Per cent 66.60 73.85 78.00 71.60 64.20 a. Males Per cent 76.10 80.95 83.70 80.80 75.70 b. Females Per cent 56.90 66.25 72.30 61.90 52.3

Nature and source of data

The detailed information required for the study was collected from the primary sources in order to accomplish the various objectives of the study. The primary data relating to the consumption behaviour of coffee and tea were collected from the respondents by personnel interview method to ensure that the data made available by them was adequate, comprehensive and reliable. Information on the following aspects was collected from 240 households is as follows; 1. General information from the individual respondents regarding their social, economical and demographic characteristics like age, education status, occupation, monthly income, family size and family type. 2. Monthly family expenditure on food and non-food items in general and coffee and tea in particular were collected. 3. Information regarding the consumption pattern of coffee and tea was obtained. 4. Attributes influencing the preference of a particular coffee and tea brand was obtained from the sample respondents. 3.2.3 Variables of the study and their measurement For evaluating the socio-economic factors influence on consumption of coffee and tea, few variables were selected for the study. a) Age Age was measured as the number of calendar years reported to have been completed by the respondents at the time of interview. The respondents were categorized in to three groups based on their age, using the formula: mean +/- (0.425 X Std dev) Category Range (Years) Younger age group Up to 35 Middle age group 35 50 Older age group Above 50 b) Education It refers to the number of years of formal schooling, successfully completed by the respondents. The respondents were grouped into the following categories: illiterate, primary

schooling, high schooling, SSLC, PUC, graduation and post graduation. c) Family type It refers to the classification of family as nuclear and joint family. Nuclear family represents the families with single couple and unmarried children. Joint family is the family consisting of more than one couple and married children living together. The respondents were categorized accordingly and expressed in frequency and percentage. d) Religion Religion refers to the particular system of faith and worship. The respondents were categorized under Hindu, Muslim, Christian and Jain religions. e) Total family income The total family income of the respondents was worked out by taking into account the income generated by all the members of the family from income generating activities and occupations in a month. Categorization of the respondents based on the total family income was done using the formula: mean +/- (0.425 X Std dev). The categories were, Category Income range (Rs) Low income group Up to 11,375 Middle income group 11,375 to 23,125 High income group Moe than 23,125

Analytical tools and techniques employed

The collected data was tabulated and analyzed. The tools used for the analysis are as follows. Tabular analysis Chi-square distribution The chi-square distribution has many uses in the field of testing of hypotheses. They are used to test whether a population has given variance; to test goodness of fit of a theoretical distribution to a observed distribution; and to test independence of attributes in a contingency table. Chi-square tests are also used for testing some non-parametric hypotheses. Let Z1, Z2,.Zn be n independently distributed standard normal variables. Then, the distribution of chi-square is equal to Z1 2+ Z2 2+,.+Zn 2 is called chi-square distribution with n degrees of freedom. Here chi-square has n independent variable components. Therefore, its degrees of freedom is n. the degrees of freedom of chi-square is the number of independent components that it has. In a population, suppose we consider two attributes, we may find dependence (association) between them. For example, suppose workers of a factory are classified as smokers and non-smokers and they are also classified as men and women. Here, we may find the number of smokers is more among men than among women. And so, we say that the attributes smoking and sex is dependent (associated). The statistical hypothesis under test is that the two attributes are independent of one another. To test the hypothesis, we use the test statistics: _2 = _ (O - E)2

E Where, O = Observed frequency E = Expected frequency 3.3.2.2 Students t-distribution When mean and variance are independent variables, the statistics t is distributed in the form defined by Student and Fisher. This condition holds good only for samples drawn from normal population. Therefore, t distribution is applicable only to samples which are drawn from normal population. The t distribution is similar to the normal curve since it is single peaked at, and symmetrical about, a zero mean, for the case in which area under the distribution is unity. The t distribution is a whole family of distribution, one for each value of degree of freedom. The variance of t distribution is more than the variance of standard normal distribution but it approaches the variance of the standard normal distribution as the degrees of freedom increases. The statistic t ranges from negative infinity to positive infinity. The graph of t distribution is lower at the centre and high at tails than standard normal curve. X1m X2m t = -----------------------------_ Sp 2[(1/n1) + (1/n2)] With (n1 + n2 2) degrees of freedom Where, X1m = Mean of the first group X2m = Mean of the second group n1 = Number of observations of the first group n2 = Number of observations of the second group Sp 2 = Pooled variance and is given by, S2 = (SS1 + SS2 )/ n1 +n2 - 2 Here, SS1 and SS2 are the sum of squares for first and second samples, respectively. 3.3.2.3 Functional/Regression analysis To study the factors influencing on the quantity of beverage purchased by the sample respondents, multiple linear regression analysis was used. In the analysis, monthly quantity of beverage consumed was used as a dependent variable and the independent variable used were price of the beverage, monthly family income, number of family members, age and education. The function form of regression equation used was D = f (X1, X2, X3, X4, X5) Where, D = Demand for coffee and tea (kgs per month) X1 = Age (number of years) X2 = Education (number of years of professional schooling completed) X3 = Family size (number) X4 = Total family income (Rs. per month) X5 = Price per unit of the beverage (Rs. per kilogram) 3.3.2.4 Conjoint analysis Conjoint analysis is a market research tool for developing effective product design. Using conjoint analysis, the researcher can answer questions such as: what product attributes is important or unimportant to the consumer? What level of product attributes are the most or least desirable ones in the consumers mind? What is the market share of preference for

leading competitors products versus the existing or proposed product? Answers to these questions are of crucial importance in the design and launch of a successful product. The virtue of conjoint analysis is that it asks the respondent to make choices in the same fashion as the consumer presumably does by trading off features one against another. There are two general approaches to collect data for conjoint analysis the twofactorat-a-time trade off method and the multiple factor full-concept method. With the trade off method, respondents are asked to rank the cells of a series of matrices, each matrix crossing the levels of one factor with the levels of another. The two-factor-at-a-time is hardly used today. The full-concept method is considered more realistic because all factors are considered at the same time. In the full concept method, the respondent is asked to rank, order or score a set of profiles or cards according to preference. On each of these profiles, all factors of interest are represented and a different combination of factor levels (features) appears. The respondents task is to rank each profile from the most to the least preferred. From these rankings or scores, conjoint analysis derives utility scores for each factor level. These utility scores, analogous to regression co-efficients are called part-worths and can be used to find the relative importance of each factor. Such information is very useful while deciding which combination of factor levels is best for a new product or service and when predicting various outcomes, such as sales, given certain combinations of factor levels.

Socio-economic factors influencing consumption of coffee and tea

To identify the factors influencing the demand for the coffee and tea, a multiple linear regression method was used. This functional form was selected as it gave a better fit to the data. The dependent variable selected for the model was quantity of beverage consumed, measured in kgs. The independent variables were age, education, family size, family income (Rs. Per month) and price per unit (Rs. ). The results of the regression are presented

Monthly expenditure pattern of urban and rural households The expenditure pattern of the sample households in the urban and rural areas are given in the Table 4.5. The results show that the urban households spent higher (Rs. 2620.93) compared to the rural household (Rs. 2129.88) in case of total food items. The total food expenditure of all the sample households stood at Rs. 2375.40. Looking into the percentage of income spent on food items, the rural households had to spend more percentage of their income (23.88%) while the urban counterparts spent about 23.88 per cent. On an average, about 20 per cent of the total income of the sample respondents was spent on the food items. The urban households purchased a total of 1.25 kgs of coffee and/or tea powder every month, while the rural ones purchased 1.16 kgs. The average total quantity of coffee and/or tea powder purchased by all the sample respondents was 1.20 kgs per month. Its tvalue was non-significant at 1.01. Comparing the expenditure, urban households spent relatively more at Rs. 235.13 and the rural households spent Rs. 160.39. On an average, Rs. 197.76 was spent on coffee and/or tea powder every month. Looking into the percentage of income spent on the coffee and/or tea powder, it was 1.17 per cent of the income for urban, 1.33 per cent of the income for rural respondents. Milk was consumed by almost all the households, in both rural as well as urban areas. In the urban region, on an average 29.13 litres of milk was consumed by spending about 2.87 per cent of the total income at an average of Rs. 475.42 per month. The rural households spent about Rs. 402.49 and purchased 24.76 litres per month. Their income per cent spent on milk stood at 5.07. Totally, about 26.94 litres of milk was consumed by the sample households spending around Rs. 438.95, taking away 3.97 per cent of their income on an average. Classification of sample respondents based on age and income The distribution of sample respondents based on age and income is furnished in Table 4.2. The respondents were classified into three age groups, namely, young age group (25.40%), which comprised of respondents below 35 years of age; middle age group with 49.20 per cent of the total respondents, with a age ranging from 35 to 50 years and the old age group which comprised of respondents above 50 years of age and had a share of 25.40 per cent. In the urban area, 33 respondents (27.50%) belonged to the young age group and 23.30 per cent of the rural respondents were below 35 years of age. Middle age group had the highest number of respondents in both the regions. It was 48.30 per cent in the urban and 50 per cent in the rural area of the selected districts. There were 29 respondents (24.20%) from the urban and 32 respondents (26.70%) from the rural area, who belonged to the old age category. The income of the respondents was greatly diverse with a minimum income of Rs. 3,000 to the maximum of Rs. 85,000. It was grouped into 3 categories, they are, low income group, which consisted of respondents below Rs. 11,375 and had 36.70 per cent of the total

sample respondents. The middle income group had an income range of Rs. 11,375 to Rs. 23,125 and contained 49.20 per cent of the selected sample respondents, while the high income group with a range of more than Rs. 23,125 had about 38.80 per cent of the total respondents.
Monthly expenditure pattern of urban and rural households