INTRODUCTION

COLD DRINK INDUSTRY

Definition of soft drink

Soft drinks are non-alcoholic water-based flavoured drinks that are optionally sweetened,
acidulated and carbonated. Some carbonated soft drinks also contain caffeine; mainly the
brown-coloured cola drinks.
Globally, carbonated soft drinks are third most consumed beverages. Per capita annual
consumption of carbonated soft drinks is nearly four times the per capita consumption of fruit
beverages Soft drink consumption is growing by around 5% a year, according to the
publication Global Soft drinks 2007, published by the Zenith International. Total volume
reached 523,000 million litres in 2007, giving a global per capita consumption of around 67.5
litres per year.
North America is the largest soft drinks market with 27 per cent of total world soft drink sales
and a consumption of 48 gallons per person per year (192 litres/ person / year). The European
market accounts for 21 per cent, with a per capita consumption of 12.7 gallons per year (50.8
litres / person/ year). The fastest growth in soft drink consumption is in Asia. Pakistan is
predicted to have the highest percentage growth rate while India is expected to make sizeable
volume gains, as affluence spreads to more of its vast population.

Major Players-Global
The global soft drink industry is highly concentrated, being largely controlled by the two
multinational companies; Coca Cola and PepsiCo. Coca Cola leads the carbonated soft drink
market in most countries in the world with 60% of the global cola market with its flagship
Coca-Cola brand. Other notable players include Cadbury Schweppes.

Indian Scenario
Market
According to government estimates soft drinks marketed in India were 6540 million bottles in
March 2001. The market growth rate, which was around 2-3% in 80s, increased to 5-6% in
the early 90s and is presently 7-8% per annum. Most of the sales of soft drinks take place
during summers while just 5-6% of total sales take place in winters. In summers the high
season lasts for 70-75 days, which contributes more than 50% of the total yearly sales. In
terms of regional distribution cola drinks have main markets in metro cities and northern
states of UP, Punjab, Haryana etc. Orange flavoured drinks and sodas are popular in southern
states. Western markets have preference towards
Mango-flavoured drinks. Non-alcoholic beverage market can be divided into fruit drinks and
soft drinks. Soft drinks available in glass bottles, aluminium cans, PET bottles or disposable
containers can be divided into carbonated and non-carbonated drinks. Cola, lemon and
oranges are carbonated drinks and non-carbonated drinks include mango drinks. Soft drinks
can also be divided into cola products and non-cola products. Cola products in Indian include
brands like Pepsi Cola, Diet Pepsi, Coca- Cola, Diet Coke, Thumps Up etc. Cola drinks
account for nearly 61-62% of the total soft drinks market in India. Non-Cola products
account for 36% the total soft drink market
. Major Players in India
The two global majors PepsiCo and Coca-Cola dominate the soft drink market in India.
Coca-Cola, which had winded up its India operations during the introduction of the FERA
regime, re-entered India 16 years later in 1993. Coca-Cola bought local brands-Thumps Up,
Limca and Gold Spot from Parle Beverages and soft drink brands Crush, Canada Dry and
Sport Cola from Cadbury Schweppes in early 1999.
Pepsi started a couple of years before Coca Cola in 1991 has bought over Mumbai based
Dukes range of soft drink brands. There are conflicting figures about their market share.
Some estimates put the market share of PepsiCo to be higher and some put the market share
of Coca Cola to be higher. However, the soft drinks segment, dominated by these two
companies, accounted for Rs 6,247 crore in sales in 2002.

Consumer Behaviour
The term consumer behaviour refers to the behaviour that consumers display in searching for,
purchasing, using, evaluating and disposing of products and services that they expect will
satisfy their needs. The study of consumer behaviour is the study of how individuals make
decisions to spend their available re- source (time, money, effort) on consumption related
items. It includes the study of what they buy, why they buy it, when they buy it, where they
buy it, how often they buy it and how often they use it.
Information about the pattern of consumption in various segments of society and
dynamics of consumer behaviour are central to the understanding for developing new
concepts in marketing. The essence of modern marketing concept is that all elements of
business should be geared towards identifying and satisfying the needs of the consumers.
Decision Making Process
The consumers decision to purchase or reject a product is a moments of final truth for
marketer. It signifies whether the marketing strategy has been wise, insightful, and effective,
or whether it was poorly planned and missed the mark. Thus, marketers are particularly
interested in consumers decision-making process. We would be discussing a simple model of
consumer decision making that emotional consumer. The modal, has three major components:
1)

Inputs

2)

Process

3)

Output

CONSUMER DECISION MAKING PROCESS

External influences

Input

Firms Marketing
Efforts
Product
Price
Place
Promotion

Socio culture
Environment
Family
Reference Group
Other noncommercial
influence
Social class
Culture and sub-

Consumer Decision Making

Process

Psychological
Psychological
Factors
Factors

Need
recognition
Information
search
Valuation

Perception
Motivation
Attitude
Learning
Experien
ce

Post Purchase Behaviour

Output

Purchase
Trial
Repurcha
se
Post purchase
evaluation
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INPUTS
The input component draws on external influences that serve as sources of
information about a particular product and influence a consumers product-related values and
behaviour. Chief among these input factors are the marketing mix activities of organizations
that attempt to communicate the benefits of their products and services to their potential
customer, and the no marketing socio-cultural influences, which, when internalized, affects
the consumers purchase decision.
PROCESS
The process component of the modal is concerned with how consumers make
decisions. The psychological field represents. The internal influences (motivation, perception,
learning, personality, and attitudes) that effect the consumers decision making processes.
Pre purchase Activity: After the problem is identified, the buyer indulges in pre purchase
activity. It is under stood that need is a father of a deed.
There generally remains a time lag when a person thinks to buy and the actual
incidence of buying. During this time, the person is energized and is likely to be influenced
by various factors. Need arousal drives the consumer to collect information about the
required product. He first indulges in internal search, scans his psychological field so as to
recollect of retrieve any information or past experience related to particular need. His
psychological field comprises of his past learning. Perception, personality and past
experience. If he is not satisfied he then goes in for external search and looks for various
sources of information. The degree of perceived risk can also influence this stage of the
decision process. In high risk situation they are likely to engage in complex information
search and evaluation tactics.
Of key interest to marketer are the various sources of information that the consumer
will return to and the relative influence that they will have on his buying behaviour.

Evaluation of Alternatives: when evaluating potential alternatives consumers tend to use

two types of information:
1.

A list of brands from which they plan to make their selection (the evoked set), and

2.

The criteria they will use to evaluate each brand.

The criteria consumers use to evaluate the brands that constitute their evoked sets
usually are expressed in terms of important product attributes. Consumers use certain
procedures or rules to facilitate a choice among multi attribute objects. Consumers
decision rules have been broadly classified into two major categories compensatory
and non compensatory decision rules.
An understanding of which decision rules consumer apply in selecting a
particular service or product is useful to marketers concerned with formulating a
promotional programme.

Output
The output portion of consumer decision marking model concerns two closely
associated kinds of post decision activity. Purchase behaviour and post purchase evaluation.
The objective of both activities is to increase the consumers satisfaction with his/her
purchase.
Purchase Behaviour: Consumer make two types of purchase and repeat purchase. If a
consumer purchase a product (or brand) for the first time, and buys a smaller quantity than
usual, this purchase would be considered a trail. Thus, a trail is the exploratory phase of
purchase behaviour in which consumers attempt to evaluate a product through direct use.
If the new brand is established product category (cola, chewing gum, candies) is
found by trail to be more satisfactory or better than other brands, consumers are likely to
repeat the purchase, Repeat purchase behaviour is closely related to the concept of brand
loyalty, which firms try to encourage because it contributes to greater stability in the
marketplace.

Customer Satisfaction

Customer satisfaction11, a business term, is a measure of how products and services supplied
by a company meet or surpass customer expectation. It is seen as a key performance indicator
within business and is part of the four perspectives of a Balanced Scorecard. In a competitive
marketplace where businesses compete for customers, customer satisfaction is seen as a key
differentiator and increasingly has become a key element of business strategy.[
Satisfaction is a persons feeling of pleasure and disappointment resulting from comparing a
products perceived performance in relation to his or her expectations. It is only the customer
delight that marketer aims for. Increasing competition (whether for-profit or nonprofit) is
forcing businesses to pay much more attention to satisfying customers. (It may help the
reader to notice the role of customer satisfaction in the overall context of product or service
development and management. See Product/Service Management. Also notice the Related
Info (including customer service) in the library.

Measuring customer satisfaction3

Organizations are increasingly interested in retaining existing customers while targeting noncustomers;[2] measuring customer satisfaction provides an indication of how successful the
organization is at providing products and/or services to the marketplace.
Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of
the state of satisfaction will vary from person to person and product/service to
product/service. The state of satisfaction depends on a number of both psychological and
physical variables which correlate with satisfaction behaviors such as return and recommend
rate. The level of satisfaction can also vary depending on other options the customer may
have and other products against which the customer can compare the organization's products.
Because satisfaction is basically a psychological state, care should be taken in the effort of
quantitative measurement, although a large quantity of research in this area has recently been
developed. Work done by Berry, Brodeur between 1990 and 1998 [3] defined ten 'Quality
Values' which influence satisfaction behavior, further expanded by Berry in 2002 and known
as the ten domains of satisfaction. These ten domains of satisfaction include: Quality, Value,

Timeliness, Efficiency, Ease of Access, Environment, Inter-departmental Teamwork, Front

line Service Behaviors, Commitment to the Customer and Innovation. These factors are
emphasized for continuous improvement and organizational change measurement and are
most often utilized to develop the architecture for satisfaction measurement as an integrated
model. The usual measures of customer satisfaction involve a survey

[4]

with a set of

statements using a Likert Technique or scale. The customer is asked to evaluate each
statement and in term of their perception and expectation the of the performance of the
organization being measured.

Customer Satisfaction a Critical Component of Profitability4

Exceptional customer service results in greater customer retention, which in turn results in
higher profitability. Customer loyalty is a major contributor to sustainable profit growth. To
achieve success, you must make superior service second nature of your organization. A
seamless integration of all components in the service-profit chain employee satisfaction,
value creation, customer satisfaction, customer loyalty, and profit and growth links all the
critical dynamics of top customer service.
Sadly, mature companies often forget or forsake the thing that made them successful in the
first place: a customer-centric business model. They lose focus on the customer and start
focusing on the bottom line and quarterly results. They look for ways to cut costs or increase
revenues, often at the expense of the customer.
They forget that satisfying customer needs and continuous value innovation is the only path
to sustainable growth. This creates opportunities for new, smaller companies to emulate and
improve upon what made their bigger competitors successful in the first place and steal their
customers.

Consumer Preference
In microeconomics, preferences of consumers and other entities are modeled with preference
relations. Completeness is more philosophically questionable. In most applications, S is an
infinite set and the consumer is not conscious of all preferences. For example, one does not
have to make up one's mind about whether one prefers to go on holiday by plane or by train if
one does not have enough money to go on holiday anyway (although it can be nice to dream
about what one would do if one would win the lottery). However, preference can be
interpreted as a hypothetical choice that could be made rather than a conscious state of mind.
In this case, completeness amounts to an assumption that the consumer can always make up
their mind whether they are indifferent or prefer one option when presented with any pair of
options.

Consumer preferences2
The underlying foundation of demand, therefore, is a model of how consumers behave. The
individual consumer has a set of preferences and values whose determinations are outside the
realm of economics. They are no doubt dependent upon culture, education, and individual
tastes, among a plethora of other factors. The measure of these values in this model for a
particular good is in terms of the real opportunity cost to the consumer who purchases and
consumes the good. If an individual purchases a particular good, then the opportunity cost of
that purchase is the forgone goods the consumer could have bought instead.
We develop a model in which we map or graphically derive consumer preferences. These are
measured in terms of the level of satisfaction the consumer obtains from consuming various
combinations or bundles of goods. The consumers objective is to choose the bundle of goods
that provides the greatest level of satisfaction as they the consumer define it.
But consumers are very much constrained in their choices. These constraints are defined by
the consumers income, and the prices the consumer pays for the goods. We will formally
present the model of consumer choice. As we go along, we will establish a vocabulary in
order to explain the model. Development of the model will be in three stages. After a formal
statement of the consumers objectives, we will map the consumers preferences. Secondly,
we present the consumers budget constraint; and lastly, combine the two in order to examine
the consumers choices of goods.

Before a new product can be made, or an existing one varied, someone must have the idea of
doing so. Since market research as a business activity is conducted and paid for by firms, the
investigation of consumer wants and preferences is fairly well defined by the spheres of
interest that exist within the firm. There is little point in asking the public the open-end
questions, "What do you need, or want? What shall we make?" The consensus appears to be
that consumers themselves scarcely ever originate new product ideas, that development of a
specific product represents the functioning of creativity in business, and that such creativity
may be found among technical research, production engineering, market research, or sales
staff, all of whom have been responsible for one idea or another.
Considering the magnitude of choice that confronts the American public, it is easy to
understand why this is true. Any household consumer is likely to deal in a far greater variety
of products and purchases than any firm, and any consumer's suggestions for new items cover
a broader field than that of any business interest. The firm is oriented to production and
marketing; the consumer, to his own needs and to an unlimited range of alternatives.
The consumer may say, for example, in answer to the open-end question, "What do you
want?" "We'd like something to make shoe polishing less of a messy job." For the
manufacturer of shoe polish, however, this does not offer clear instructions on how to adapt
his paste, liquid, or spray toward even greater convenience. Nor does it produce for the
manufacturer of shoes a formula for a plastic shoe that can be so cheaply made; it will be
discarded when soiled.
One acceptable alternative, for consumers, might conceivably be for drug companies to
develop a toughening agent for feet so that shoes are no longer needed for protection, and
then for the world of fashion to insist that bare feet are the epitome of style. Thus, consumers'
suggestions rarely furnish new product ideas, either because consumers are inarticulate about
their own needs, or because they lack the technical competence to specify feasible
alternatives.

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Coca Cola
Company Profile
John Pemberton was the inventor of Coca Cola
In May, 1886, Coca Cola was invented by Doctor John Pemberton a pharmacist from Atlanta,
Georgia. John Pemberton concocted the Coca Cola formula in a three legged brass kettle in
his backyard. The name was a suggestion given by John Pemberton's bookkeeper Frank
Robinson.

Birth of Coca Cola18

Being a bookkeeper, Frank Robinson also had excellent penmanship. It was he who first
scripted "Coca Cola" into the flowing letters which has become the famous logo of today.
The soft drink was first sold to the public at the soda fountain in Jacob's Pharmacy in Atlanta
on May 8, 1886.
About nine servings of the soft drink were sold each day. Sales for that first year added up to
a total of about $50. The funny thing was that it cost John Pemberton over $70 in expanses,
so the first year of sales were a loss.
Until 1905, the soft drink, marketed as a tonic, contained extracts of cocaine as well as the
caffeine-rich kola nut

Asa Candler31
In 1887, another Atlanta pharmacist and businessman, Asa Candler bought the formula for
Coca Cola from inventor John Pemberton for $2,300.
By the late 1890s, Coca Cola was one of America's most popular fountain drinks, largely due
to Candler's aggressive marketing of the product. With Asa Candler, now at the helm, the
Coca Cola Company increased syrup sales by over 4000% between 1890 and 1900.
Advertising was an important factor in John Pemberton and Asa Candler's success and by the
turn of the century, the drink was sold across the United States and Canada. Around the same
time, the company began selling syrup to independent bottling companies licensed to sell the
drink. Even today, the US soft drink industry is organized on this principle.
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Death of the Soda Fountain - Rise of the Bottling Industry

Until the 1960s, both small town and big city dwellers enjoyed carbonated beverages at the
local soda fountain or ice cream saloon. Often housed in the drug store, the soda fountain
counter served as a meeting place for people of all ages. Often combined with lunch counters,
the soda fountain declined in popularity as commercial ice cream, bottled soft drinks, and fast
food restaurants became popular.

New Coke
On April 23, 1985, the trade secret "New Coke" formula was released. Today, products of the
Coca Cola Company are consumed at the rate of more than one billion drinks per day.

The Coca-Cola Company Mission11

Our Mission is:

To refresh the world - in mind, body and spirit

To inspire moments of optimism - through our brands and actions, and

To create value and make a difference - everywhere we engage

The Coca-Cola Company Vision27

To achieve our Mission, we have developed a set of goals, which we will work with our
bottlers to deliver:
Profit: Maximising return to shareowners while being mindful of our overall responsibilities.
People: Being a great place to work where people are inspired to be the best they can be.
Portfolio: Bringing to the world a portfolio of beverage brands that anticipate and satisfy
people's desires and needs.
Partners: Nurturing a winning network of partners and building mutual loyalty.
Planet: Being a responsible global citizen that makes a difference.

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The Coca-Cola Company Values

Our shared values that we are guided by are:

Leadership

Passion

Integrity

Accountability

Collaboration

Innovation

Quality

The Soft Drink Industry Scenario in US5, 29

The soft drink industry in the US is not different from that in any other country with respect
to the players involved in the business. The major components of the industry consist of the
concentrate manufacturers, bottlers and the sales and distribution network of the companies.
The role and responsibilities of each of them are different: the major activity taken up by the
concentrate manufacturers relates to the production of the basic product which is bottled by
the bottling plants

13

14

The Indian Soft Drink Industry

Scenario
the cola market in India the companies have continued to wage their war in India. Coke, with
the strategic move of buying out Parle, gained a huge market share overnight. But Pepsi is
sparing no efforts to gain a larger share of the market. The potential in the Indian market is
tremendous. The Indian market is roughly more than Rs 1,200 crore; moreover, the per capita
consumption of three bottles in India is lagging way behind the USs astounding 700 bottles
per capita consumption. Both Coke and Pepsi have rightly realized that the immediate
priority is in expanding the market by increasing the growth rates. The Indian market
averaged a growth rate of 2.5 per cent between the years 1984-92. From 1992, when the Cola
war took a serious turn, the growth rate has almost doubled. Last year the market grew by 20
per cent in volume term, with estimated sales of 140 million cases (one case = 24 bottles of
300 ml each) up from 115 million cases in 1994. In 1977 a change in the government at the
centre led to the exit of Coke which preferred to quit rather than dilute its equity to 40 per
cent in compliance with the
Provisions of FERA. The first national cola drink to emerge was Double Seven. In the
meantime, Pure Drinks, Delhi, on Cokes exit switched over to Campa Cola, and, by the end
of 1970s, Campa Cola was practically alone in the cola market. Thumps Up was introduced

15

by Parle in the beginning of 1980s, followed by Thril by Mcdowells and Double Cola by
Double Cola Manufacturing Company (DCMC) an NRI-run outfit with its plant at Nasik.
An additional dimension to the Indian soft drink industry was that of fruit a drink which was
valued at Rs 40 core and among the brands in the market, the leader was Parles Frooti with
about 40 per cent of the market share. The other players in this segment who have posed
challenges to Parle are Godrej (with Jump in) and Ahmedabad-based Pioma industriesRasna
Cola-Cola. Before 1992, the Indian soft drink industry had not grown fast mostly due to high
excise duties and government encouragement of fruit drinks over carbonated drinks. Though
Limca was the largest selling brand of bottled soft drink in India, from consumers point of
view Cola was the most popular flavors. It accounted for about 40 per cent of the market.
Lime and Lemon drinks followed with about 30 per cent, and Orange drinks had only
about 20 per cent of the market share. Carbonated soft drinks accounted for the rest 10 per
cent. From 1984 to 1992, the Rs 1,200 crore Indian soft drink industries grew at an average of
2.5 to 3 per cent the highest being 12.4 per cent during 1984-85. Pepsi had a very significant
first mover advantage in the Indian market. It did not have the condition of divestment of 49
per cent equity in downstream ventures attached to it when it received permission to invest in
India. Pepsi had obtained the government approval for its downstream ventures prior to the
FDI guidelines that made Indian equity holding mandatory. Thus, in its original clearance,
Pepsi was not only allowed to hold 100 per cent equity in its holding company but was also
allowed to carry out bottling and marketing operations. The government approval, moreover,
had allowed Pepsi to carry out acquisition of assets to expand its business in the country.
Pepsi used this clause in its approval to buy out 100 per cent stake in some of the domestic
bottling companies including its high profile buyout of Gujarat Bottling Company, the former
Coke franchisee in Ahmedabad. Industry ministry sources have clarified that while Pepsi
would be required to seek fresh government approval if it picks up shares in domestic
bottling companies as part of its portfolio investment, it does not need such approval if the
assets are acquired for expansion. Coca Cola came back to India after 16 years when it was
launched on October 24, 1993, at Agra. Coca-Cola was initially wooed by the Godrej group,
Great Eastern Shipping and the Britannia Industries Ltd, led by Rajan Pillai. In March 1991,
it signed an MOU with BIL and this proposal was accepted by the Chandrasekhar
government. But relationship between the two companies turned sour over the export
oriented clause and finally on June 23, 1993, Coca Cola got the permission to enter the
country with a 100 per cent unit in India. On September 22, 1993, the company bought out
the Parle brands. The industry, prior to 1990, was witnessing sluggish growth rates (CAGR:
16

around 5 per cent) with two domestic players: Parle and Pure Drinks. The entry of the cola
giants, Coke and Pepsi, led to a rapid expansion in the size of the market (CAGR for the first
half of the 1990s: around 20 per cent). Cokes acquisition of Parle has turned the market into
a

The Soft Drink Industry Today

At present, Coke operates through a system of franchise bottlers. It has 53 bottling units
partitioned amongst 26 Companies. Each of these bottlers earlier was doing business with
Parles Ramesh Chouhan, before he sold off his soft drink brands to Coke. As per agreement
signed between Coke and these bottlers, the former supplies them with the soft drink
concentrate, which they bottle and then distribute in their respective territories. In a move to
strengthen its position in the Indian market as well as reduce, if not eliminate completely, its
conflicts with its bottlers, Coke plans to set up two bottling companies. Promoted by Coke
South Asia Holdings, it will own all the bottling facilities that the company currently holds in
the country. Under the new plan, the bottlers will cease to remain independent entities;
instead, depending on geographical location, they will be merged into either of the mega
bottling companies. Considering the huge potential of growth of the Indian market, Coke
wants to expand the market by 40 per cent per annum, as against existing growth levels of 20
per cent. As a move towards that direction, Coke is offering bottlers an equity stake in the
two new bottling companies and also a seat in the special advisory committee to assist the
mega bottling companies on its strategy in India. Coke has the plan to take its bottling
companies public in India and then recoup all the investments it has made in the country so
far. Coke presumes that the ownership of bottling units will do away with the fear about the
prospect of any of its bottlers defecting to competitor Pepsi. It also anticipates that it will

17

provide the company a fair deal of flexibility and control over bottling, the same advantages
that are enjoyed by its competitor Pepsi. Thus, once it owns the bottling units, it would be
easier for Coke to transfer the bottling technology to India. And more importantly, if Coke
were to put its money in expanding operations, the cost of funds would be far less than if the
Indian bottlers did, simply because capital can be cheaper abroad. But there lies an element of
emotion since most of the 26 bottlers have been in the trade for over 20 years. Since Coke
needs bottlers as much as bottlers need Coke, if Coke forms a bottling company, it must be
able to convince the bottlers that their capital employed will definitely multiply, perhaps
faster than its present rate of accretion. It should also be able to provide some sort of a safety
net to the bottlers if the bottling company fails to achieve its pledged profitability. And
Finally, Coke must assure the bottling companies that they will remain active participants in
the business, and not degenerate into passive shareholders. Squeezing margins is Cokes main
weapon, whereas the bottlers intend to use the political weapon. Many of them have been
making representations to the government and lobbying with members Of parliament to put
pressure on Coke. They have been talking about launching a new soft drink to take on both
Coke and Pepsi. By early 1999, Coke should have at least 50 per cent of its bottling
operations under its belt, wishes Coca-Cola India president and CEO. The multinational soft
drinks company has already acquired several bottling plants in India and hopes to bring 20-25
of its 50 bottlers under its wing by next year. This translated into real terms and pegged to the
current market output level, means that the company will directly control 65 million cases of
the total 130 million. Coke is now stressing that bottlers with a shorter term perspective
should either sell their plants to the company or enter into a joint venture arrangement. Coke
is entering into dialogue with its bottlers to thrash out their plans and the companys
expectations, based on its current strategy of building on and managing its existing capacities
more concertedly. In a strategic decision signifying the importance of its Indian operations,
Coca- Cola India has been upgraded as a separate business division, reporting directly to the
headquarters of the Coca-Cola Company at Atlanta. The new division would also signify less
bureaucracy since its needs were earlier routed through the Bangkok office and would
improve accountability, responsibility and autonomy of Coke. The restructuring was also
necessitated by the high volumes involved in the Indian market and its future growth
prospects. Operating as a division will now allow the company to manage its business with
more autonomy. The company has undertaken new marketing initiatives, which includes
launching its products in Bangalore and Guntoor in the south and the get refreshed
promotional campaigns for its Limca and Thumps Up brands, which have been identified as
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new growth vehicles. (Pepsi had also restructured its Indian operations by creating a separate
division PepsiCo India.)
Coca-Cola India has firmed up a Rs 100 crore investment programmed for its first companyowned bottling plant in the state of Karnataka. Simultaneously, rival Pepsi is also pressing
ahead with its Rs 25 crore expansion plan in the state, spearheaded by its proposal to launch
carbonated fruit juice-based beverages. According to the company, the only stumbling block
in this move is the high rate of excise. It is also setting up a research and development (R and
D) centre at Neelamangala in Karnataka. Pepsi has already acquired 12 acres of land adjacent
to its Greenfield project set up about a year ago. This land would mainly be used for R and D
activities in horticulture. Part of this investment would also be employed to set up other
infrastructural facilities like carriage trucks and the necessary cold-chain, etc. Initially,
however, the company would develop new varieties of potatoes and tomatoes for use in its
snack foods business operated through a separate company, christened Frito-Lay India.
Later, there are plans to extend the activity to other fruits which may be used to prepare
carbonated fruit juice-based beverages. The Neelamangala bottling plant spread over an area
of five acres has lines to bottle fruit juices. Presently, the company manufactures and sells
two mango-based beverages, namely, Slice and Mangola. While the former is revenue
grosser worldwide, the latter was acquired by Pepsi from the Mumbai based Dukes. But
Pepsis archrival Coke has no immediate plans to foray into products outside aerated soft
drinks like Coke, Fanta, Thumps Up, Limca, etc, unlike that of Pepsi. Coke had already
acquired a 20 acre plot to set up a Greenfield plant near Bangalore. Part of the investment
would also be used in setting up the plant, to acquire machinery and chillers and for
establishing other infrastructural needs like carriage trucks, etc. This bottling plant would be
Cokes third company-owned bottling plant in the country. Coke has the approval of the
Foreign Investment Promotion Board (FIPB) to set up four investing companies for equity
investment in downstream bottling units. Coca-Cola Indias restructuring plan is one year
ahead of schedule and the consolidation of the companys bottling operation would be
complete by the end of 1999. The company expects to own and operate at least 25 COBOs by
the mid-1999. Around 15-20 bottlers would enter equity joint ventures, with Coke
commanding a majority stake in them. The remaining 5-7 bottlers, based mainly in north
India, would continue to work as the soft drink majors franchise bottlers. The equity
investments in the bottling companies were being made by two companies set up for the
purpose, namely, Hindustan Coca-Cola Bottling North-east and Bharat Coca-Cola Bottling
South-west. By year 2003 the company would divest 25 per cent to the Indian public,
19

implying it would end up being owners of 51 per cent equity. Most of the bottlers were,
however, opposed to the move

Justification of the study

Every research that we are conducting should contain some important to us. Here I am doing
the research on the topic Study of Consumer behavior regarding Cold Drinks (Pepsi & Coke)
on the basis of Price, Brand name, Consumption, Taste, Need. The main reasons of selecting
this topic is
1. Consumers of the cold drinks are very much influencing by the characters of the
products.
2. In cold drinks market (especially in Pepsi and coke) the consumption patterns are very
wide
3. Both the companies are very closely rivals of each others.
4. In cold drink market consumer behaves very dynamically and consumers need more
and more tastes and choices.
5. Rapid increase in population also affects the growth of market of these products.
6. Increasing demand of rural market.
7. Increasing income of middle class people.

20

OBJECTIVES OF THE STUDY

Primary Objective:
To know the impact of various external factors on Consumer preference and
Consumer satisfaction:

Price

Brand name

Taste

Need

consumption

Secondary Objectives:
To make suggestions to company to improve the level of satisfaction among
customers.
To know the price effect on the purchase of cold drinks.
To find the cause behind choice of particular brand of cold drinks
.

21

LITERATURE REVIEW
Websites

http://www.ciadvertising.org/sa/fall_05/adv380j/gaemi/final/home.htm-

consumer1

from this site I have gathered the information about the consumer preference.

http://madeinatlantis.com/smartshopping/new_products_consumer_preferences.htm2
from this site I have gathered the information about the consumer preference about
the new products that are being launched by these companies into the markets.

www.1000ventures.com/business_guide/crosscuttings/customer_satisfaction.html3
from this site I have gathered the information about the customer satisfaction

http://en.wikipedia.org/wiki/Customer_satisfaction4- From this site I have taken the

matter regarding how to measure customer satisfaction and how it is a component of
profitability.

http://www.researchandmarkets.com/reportinfo.asp?report_id=3055935- From this site

I have taken the matter regarding the Global Market Review Of cold drinks
Forecasts.

22

. http://inventors.about.com/library/inventors/blpepsi.htm 6.html- From this site I

have taken the matter regarding the general introduction about the cold drink industry

. http://en.wikipedia.org/wiki/Pepsi 7 I have taken the matter regarding the general

information of Pepsi group.

http://inventors.about.com/od/foodrelatedinventions/a/soft_drinks.htm 8
I have taken the matter regarding the various information like what are their values,
vision, and mission.

http://inventors.about.com/library/inventors/blpepsi.htm 9
I have taken the matter regarding the marketing philosophy, marketing strength,
market positioning about the Pepsi group.

. http://en.wikipedia.org/wiki/coke 10 I have taken the matter regarding the general

information of Pepsi group.

http://www.coca-cola.co.uk/Mission_Vision_and_Values/11 i have taken the vision

,mission, and value of coke

http://wiki.answers.com/Q/What_is_pepsi_mission_statement12 I have taken the

mission statement of Pepsi from this site

http://www.pepsico.com/Pep_Citizenship/sustainability/visionstrategy/mission_values
/index.cfm13 I have taken the values statement of Pepsi from this site

BOOKS:

Suja R. Nair, Consumer Behaviour in Indian Perspectives (First Edition: 2001),

Himalaya Publishing House, Mumbai-400004. Chapter 1, PP 3-614.
Factors influencing consumer behaviour, Decision making, Concept of consumer
behaviour is studied to know about the various factors those effects the consumer
behaviour these can be external as well as internal
23

Leon G. Schiff man and Lesli Lazar kanauk, Consumer Behaviour, Eight
Edition, Prentice Hall of India, New Delhi, PP 8,9,11,19,20 15.
Study of the customer behaviour is the study of how individuals make decisions to
spend their available resources (Time, Money and Efforts) on consumption related
items. It includes the study what they buy, when they buy it, when they buy it, where
they buy it, how often they buy it and how often they use it.

G.C. Beri, Marketing research, Third Edition, Tata Mc graw Hill Publications
PP 95-98,23316.
Matter regarding the sampling size decisions, determination of sample size and other
sampling methods.

Kothari, C.R, Research methodology, methods & techniques, new age

international ltd. Publishers, Second edition, P.no27-4217.
Methods of data collection, collection of data through Questionnaire, collection of
secondary data are referred before the data collection from this book Decisions
regarding what, where, when, how much, by what means concerning an enquiry or a
research study constitute a research design

Gupta, S.P. Stastical methods and techniques, Sultan Chand & Sons.
Educational Publishers, New Delhi,P.no 237-241,628-62918
From this book I have taken the matter regarding the hypothesising testing and what
should be the size of the sample for the application.

Jain,T.R, Statistics for MBA,V.K.(India) enterprises, New Delhi.,edition200607,P.no 135-13719

From this book I have taken the matter regarding the multiple correlations and their
use.

Magazines

The Square Trap - Page 21 by Irving Shulman - Fiction 197620 From this magazine I
have taken the growth of the cold drinks industry.

24

Eating Disorders: Time for Change - Page 8 by Mona Villapiano, Laura J. Goodman Psychology - 2001 21 From this magazine I have taken the data regarding the cold

drinks industry in india.

Living Backwards: A Transatlantic Memoir - Page 68 by Carl Dawson - Social
Science22 From this magazine I have taken the data regarding the birth of coca cola in

cold drinks industry

Operations Management: Critical Perspectives on Business and Management - Page
8823 From this magazine I have taken the data regarding the cold drinks industry in

india.
by Michael Lewis, SLACK & LEWIS, Nigel Slack - Business & Economics - 2002
Forbidden Fruit - Page 486 by Erica Spindler - Fiction 199624 i have taken the vision
,mission, and value of coke

The Living Age - Page 429 by Making of America Project, Eliakim Littell, Robert S.
Littell - American literature 185825 From this journal I have taken the matter

regarding the general introduction about the cold drink industry

Caribbean Islands - Page 620 by Sarah Cameron - Travel 200326 From this magazine
I have taken the data regarding the birth of coca cola in cold drinks industry
Bali & Lombok - Page 97 by Ryan Ver Berkmoes, Lisa Steer-Guerard - Travel
200527 From this magazine I have taken the matter regarding the Global Market

Review Of cold drinks

Manual of Cutaneous Laser Techniques - Page 32 by Tina S. Alster - Medical 200028
The Elements of Marketing - Page 226 by Paul Dulaney Converse Marketing 195229

Matter regarding the sampling size decisions,

determination of sample size and other sampling methods.

Food and Beverage Management - Page 355 by Bernard Davis, Andrew Lockwood,
Sally Stone - Business & Economics 199830 from this journalI have gathered the
information about the consumer preference about the new products that are being

launched by these companies into the markets

Pop Fiction: The Song in Cinema by Steve Lannin, Matthew Caley - Music 200531

25

RESEARCH METHODOLOGY
Research methodology is a way to systematically solve the problem. It may be understood
has a science of studying how research is done scientifically. In it we study the various steps
that all generally adopted by a researcher in studying his research problem along with the
logic behind them. The scope of research methodology is wider than that of research method.
Meaning of Research
Research is defined as a scientific & systematic search for pertinent information on a
specific topic. Research is an art of scientific investigation. Research is a systemized effort
to gain new knowledge. It is a careful inquiry especially through search for new facts in any
branch of knowledge. The search for knowledge through objective and systematic method of
finding solution to a problem is a research.
Research Design
The research design is the conceptual structure within which research is conducted; it
constitutes the blue print of the collection, measurement and analysis of the data. As search
the design includes an outline of what the researcher will do from writing the hypothesis and
its operational implication to the final analysis of data.
Research design can be of three types:
Exploratory Research Design
Descriptive Research Design
Experimental Research Design

26

The present study is Descriptive in nature, as it seeks to discover ideas and insight to bring
out new relationship. Research design is flexible enough to provide opportunity for
considering different aspects of problem under study.

Sampling and sampling design

Sampling may be defined as the selection of some part of an aggregate or totality on the basis
of which a judgment or inference about the aggregate or totality is made. In simple words, it
is the process of obtaining information about the population by examining only a part of it.
Sampling Unit: It defines the target population that will be sampled i.e. it answers
who is to be surveyed. In this study, the sampling unit is consumers of three brands of
High-end sports shoes.
Sampling Size: - It indicates the numbers of people to be surveyed. Though large
samples give more reliable results than small samples but due to constraints of time
and money, the sample size will be restricted to 100 respondents.
Sampling Design: This refers to the procedure by which the respondents should be
chosen. In this case, Stratified random sampling was done since the respondents
will classified into well defined classes or strata that were distinct from each other.
Analytical Tools
After collection of data another work necessary for any data collector is to correctly analysis
that data. So statistical tolls helps us to correctly analysis the data .As I am here using the
software for analysis of the data XLSTAT.
I will use following statistical tools:
MDS
Factor Analysis
Principle Component Analysis (PCA)
27

Multi Dimension Scaling:

Multi dimension scaling is asset of related statistical techniques often used in data
visualization for exploring similarities or dissimilarities in data. MDS is a special case of
ordination .An MDS algorithm starts with a matrix of item-item similarities, and then assigns
a location of each item in a low dimensional space, suitable for graphing or 3D visualization
Q6.Why did you prefer this Cold drinks? Grade the following factors in Rank 1 to 5
1-Most preferred

5-Less preferred

Group1 Group2 Group3 Group4 Group5

BRAND NANE

47

44

49

52

46

TASTE

68

62

61

59

66

PRICE

53

55

51

49

56

CONSUMPTION

64

62

67

61

58

NEED

72

68

71

74

70

28

INTERPRETATION

1) At the Kruskals stress one G4 and G5 got the 1 st rank in dissimilarity, disparity and distance
that mean people lies in group 4 and in G5 have the same opinion regarding to the cold drinks
companies

2) At the stress level of 0.311 all the groups are not close to each other that means the groups
different from each other.

3) In the above multi dimensional scaling Model: Dij= Pij and the level of Convergence is
0.0001. Group 1 and Group 3 has the biggest rank so we can say that their is very less
possibility of agree ness between the two group

Q 23. Are you satisfied with the overall performance?

Group1 Group2 Group3 Group4 Group5

Fully satisfied

Satisfied

Average

Less satisfied

Poor

29

Interpretation
At the Kruskals stress one G3 and G4 got the 1 st rank in dissimilarity, disparity and
distance that mean people lies in group 3 and in 4 have the same opinion regarding to the
sports shoes companies.

At the stress level of 0.103 all the groups are not close to each other that means the
groups different from each other.

In the above multi dimensional scaling Model: Dij= Pij and the level of Convergence is
0.0001. Group 3 and Group 5 has the biggest rank so we can say that their is very less
possibility of agree ness between the two group

Q 8 Weight these companies according to your preference between 1 to 5?

5-Most Preferred

1-Less Preferred

Group1 Group2 Group3 Group4 Group5

pepsi

72

70

68

73

71

7 up

56

54

51

59

52

coke

67

62

60

59

64

mirinda

46

43

47

41

49

limca

48

51

46

50

47

30

Interpretation

At the Kruskals stress one G1 and G3 got the 1 st rank in dissimilarity, disparity and
distance that mean people lies in group 1 and in 3 have the same opinion regarding to the
sports shoes companies.

At the stress level of 0.031 all the groups are not close to each other that means the
groups different from each other.

In the above multi dimensional scaling Model: Dij= Pij and the level of Convergence is
0.0001. Group 2 and Group 4 has the biggest rank so we can say that their is very less
possibility of agree ness between the two group

Factor Analysis
The purpose of factor analysis is to describe a set of variables using a linear combination
of common underlying factors, and a variable representing the specific part of the original
variables. The variance of an original variable may be broken down into a part shared
with other variables (explained by the factors) called the communality of the variable, and
a specific part called the specific variance.

factor 1
1
2
3
4
5

8
12
21
25
34

factor 2
14
28
26
18
14

factor 3
9
19
28
25
19

factor 4
21
27
24
21
7

factor 5
14
28
14
24
16

factor 6
14
21
32
19
14

factor 7
12
18
28
24
18

F1

Aware about the availability of cold drinks

do
F3
F4

does tv and hordings contains sufficent and understandable information

brand name influence on purchase behaviour
On what factor will you switch over to some other brand

F5
F6

Satisfaction level with the col drinks that you have purchased
post purcsahe experience with cold drinks

31

ase

factor 8
14
28
14
24
16

factor 9
14
17
13
34
22

the cold
experience

drinks
that
he

factor 10
11
14
23
34
18

with t
F7

If other brands offer attractive schemes then you switch over to some other brand

F8
F9
F10

does the cold drinks company meets the quality which is required
Interested to have more cold drinks in future
Recommendation of cold drinks to someone

32

cold
drinkd

Interpretation:Factor analysis selects the factor f1 & f9 are most important they are avaibility of the soft
drinks & they are interested in purchase of cold drinks in future. the another factor is the
brand name the customers like most. In all 5 factors are selected which are very important

Principal component analysis:Principal component analysis (PCA) expresses a set of variables as a set of linear
combinations of factors that are not correlated between them; these factors represent an
increasingly small fraction of the variability of the data. This method allows you to
represent the original data (observations and variables) with fewer dimensions than the
original, while keeping data loss to a minimum. Representing the data in a limited number
of dimensions (2 dimensions in this case) greatly facilitates analysis.
PCA differs from factor analysis in that it creates a set of factors that have no correlation
to one another; this corresponds to the special case where all communalities are equal to 1
(null specific variance).

33

Interpretation:- as the PCA make the cross checking of the factor analysis so in the cross
checking the factor 3&7 are found most important which influence the customers most
while purchasing the cold drinks

34

Data collection:
There are two types of data these are:
PRIMARY DATA: - The primary data are those, which are collected afresh and for
the

first time. And thus happened to be original in character. Sources of primary data are:

Questionnaire
Observation
Personal interview

SECONDARY DATA: The secondary data on the other hand, are those which have already been collected by
Someone else and which have already been passed through the statistical processes.
Sources are:. Books, magazines, newspaper, publications.

35

Hypothesis Testing
Chi-square test is used when the set of observed frequencies obtained after experimentation
have to be supported by hypothesis or theory. The test is known as X 2- test of goodness of fit
and is used to test if the deviation between observation (experiment) and theory may be
attributed to chance (fluctuations of sampling). 2 also enables us to explain whether or not
two attributes are associated or related to each other A)
Hypothesis
H0 = after sale service and consumer behaviour are Correlated.
H1=

after sale service and consumer behaviour are not Correlated.

Procedure:
(1) Set up the null hypothesis that there is no significant difference
between the observed and expected value.
(2) We compute the value of CHI- square by using the formula
CHI-square = , 2= (( Oi- Ei)2/Ei)
O- Observed value
E- Expected value
Degree of freedoms=(R-1)(C-1)
Level of significance=5

36

By applying Chi-Square
OBSERVED
Price influence on cold drinks
Brands

High

High Avg.

Average

Avg. Low

Low

mirinda

pepsi

coke

7 up

Any other

Total

16

24

28

18

14

As I have taken the sample size of 100 so it is assumed that expected value for each response
should be equal to 20.
O-E

(O-E)2

(O-E)2/E

20

-4

16

0.80

24

20

16

0.80

28

20

64

3.20

18

20

-2

0.20

14

20

-6

36

1.80

Observed

Expected

value(o)

value(E)

16

2 Calculated =

6.80

Degree of freedom (V) = (r-1) (c-1) = (5-1(5-1) =16

Level of significance=5%
for V =16

2 0.05 table value = 26.2962

37

Since the tabular value at 5% level of significance is more then the calculated value of chi. so
the null hypothesis has been rejected.
Now there is a significant relationship between the price and the cold drinks purchase

Limitations of the study

Limited area

38

The primary limitation was the limited area of the research so due to small area out of the
country the results may not be completely correct.

Small sample size

The secondary limitation was the small size of customer so due to small samples out of
big universe the results may not be completely correct

Biased responses
The chances of personal prejudice and bias are possible at respondent level. Also the
people were quite hesitant in inquiring exact data regarding their income level.

Time availability
Most of people were at their work they did not have time to give all replies.
Also time period was very short.

Finding and analysis

39

Q 1. Which cold drinks are you drinking?

response

respondent

pepsi

36

coke

44

any other

20

. Only 36% out of the total sample drinks pepsi, 44% drinks coke &20% of the people drink
other cold drinks

Q 2. What type of pack of cold drinks are you using?

40

response

respondent

200 ml

17

500 ml

42

1 ltr

30

Any other

11

Out of total 17% of people uses the 200 ml cold drinks, 42% people use 500ml pack, 30 %
people use 1ltr pack & 11%uses the other packs of cold drinks

Q 3. Which brand of cold drinks are you drinking?

41

response
thumps up
mirinda
slice
7 up
any other

respondent
15
28
21
11
25

15% of people drinks the thumps up 28%, people drinks mirinda , 11 % of the people uses
the 7 up & , 25% o the people uses the other brands of the cold drinks and 21% people drinks
slice

42

Q 4. How did you come to know about these brands of cold drinks?

response
Through friends
Family members
Advertisement
Publicity
any other

respondent
27
20
30
21
12

When its comes to knowledge about the cold drinks then 21% of the respondents got
aware through publicity and 30% through advertisement. 20% respondents got aware
through their family members.12% have come to know from other sources.
Q 5. Which factor influence you more to purchase the cold drinks?

response
price

respondent
20

scheme

27

Brand name

25

43

taste

26

need

12

The Price and taste Factors influence mostly People. It means when the people are going
for purchase the cold drinks then they are mostly influenced by these two.25% of the
respondents are influenced by the brand name of these cold drinks company.12% of the
respondents are considering need when they are going for purchase of the cold drinks

Q7. Are you aware about the all scheme available in the market?

Response

Fully Aware

Aware

Neutral

Less Aware

Not So
much

Percentage

34%

25%

21%

44

12%

8%

Percentage
40
35

34

Percentage

30
25

25

21

20

Percentage

15

12
8

10
5
0
Fully Aware

Aware

Neutral

Less Aware

Not So
Much

Responses

34% of the respondents are fully aware about the cold drinks that are available in the
market.40-45% of the people are aware and some of them are neutral regarding the
awareness.12% of the people are less aware about the availability of these cold drinks.8%
people are not so much aware.

Q 8. Weight these brands according to your preference

response
Pepsi

respondent
23

7 up

14

Coke

24

mirinda

31

limca

45

23% of the customers are preferring Pepsi while they are going for purchase,24% prefer
coke and 31% prefer mirinda. 14% people prefer the 7 up & 8% people prefer the other
brands

Q 9. Arrange these companies according to you which company gives the most benefits
to customers?
response

respondent

PEPSI

43

COKE

57

46

Now when its come to giving benefits to customers coke here also occupying the first
place, 57% people agree with this. Only 43% people think that Pepsi provides benefits to
customers..

Q 10. Which type of media influences your purchase behaviour?

response
TV

respondent
35

HORDING

13

NEWSPAPERS

17

MAGAZINE

27

47

WALL

PAINTING

When its comes to the type of media which influences the purchase behaviour of the
customer, then it is t.v.35% of the sample thinks that they are influenced by T.V when
they are going to purchase.27% are influenced by Magazine. Newspaper, Hoarding, and
wall painting have very small influence on the purchase behaviour.

Q 11. Do TV and hoardings contain sufficient and understandable information?

response
Fully satisfied

respondent
14

Satisfied

18

Average

26

Less satisfied

28

48

Dissatisfied

14

TV and hoardings are available at the Magazine. outlet. These are important for some
people, some may how do not show much interest in these. Only 32% of the total sample
are satisfied about the availability of sufficient information in these.42% of the
respondents think that these does not contain sufficient information

Q 12. Who influenced you more in your buying decision of cold drinks
response

respondent

Self

23

Family member

31

Friends/relatives

46

49

When a person is going to purchase something then a no. of items that reflects a
consumer. Here when a person is going to purchase cold drinks then Friends/relatives
play a very vital role.46% of the sample thinks that they are mostly influenced by the
Friends/relatives. After that Family members and the self also influenced the purchase
decision.

Q 13. In your opinion, what role advertisement plays?

Response

Provides

Give

Creates

Convenience

important

information

awareness

in purchase

18%

28%

18%

Misleading

details
Percentage

24%

50

12%

Percentage

12

Provides important
details

24

Give information
18
Creates awareness
Convenience in purchase
18
Misleading
28

Out of the total sample 24% of the respondents think that advertisements provides
important details that proved to be very useful when they are going to purchase. Some are
saying that it provides awareness and it is convenience in purchase.8% of the people are
saying that advertisement leads to misguide them while they are going for purchase.

Q 14 Which Companys Advertisement you like most:

response
PEPSI
COKE

respondent
59
41

51

As we all know that advertisement plays a very important role. So now a day all the
companies whether they are Indian or foreign they are going for this. 59% of the people
like the advertisement of Pepsi. Coke Ad is not so much familiar among the
respondents.41% of the sample like the advertisements of the coke

Q 15. Where you can see that Advertisement: -

response
T.V.
Road shows

respondent
64
16

Posters

internet

52

Hoardings

Companies are doing their advertisement campaign on different sources whether on T.V,
Internet, Road shows, Hoarding etc.64% of the total sample are seeing these advertisements
on T.V.In case of Internet and Hoarding they have their less impact on the final consumer
when they are going for purchase.

Q 16. How much you are involved in the various promotional activities by cold drinks
companies?
response

respondent

More

18

involvement
Normal

27

involvement
Less

32

involvement

53

No

23

involvement

Involvement means how much the person takes interest in buying a particular thing.
27% of the sample they are normally involved in buying a pair of sports shoes. 32% shows
less involvement.23% of the sample are not involved at all. They simply go to the shop and
purchase the cold drinks

17 Are you aware about different promotion activity done by cold drinks companies?
response

respondent

YES

64

NO

36

54

Promotion activities are those, which are being done by the companies for increasing their
sales, increasing market share, for creating awareness. 64% of the respondents are aware
about the different promotion activities done by the various cold drinks companies. On the
other hand 36% of the sample does not aware about these activities

Q 19.Which of the following is most preferred by you during purchase of cold drinks?
response

respondent

Price

19

brand name

25

taste

28

consumption

19

55

When it comes to purchasing of cold drinks, the customers prefer various kinds of schemes
like price, coupons, warranty etc. The sample that I have taken 28% of the
respondents prefer taste scheme while they are going for purchase. 19% of the
respondents prefer price while they are going for purchase. 25% of the
respondents prefer brand name while they are going for purchase.

Q 20. What extent brand name influences your purchase of soft drink?

response
High

respondent
19

High Average

25

Average

28

Average Low

19

Average Low

56

Mostly Respondents are influenced by the brand name when they are going to purchase the
cold drinks.19% of the respondents think that they are highly influenced by the brand name
when they are going to purchase.53% of the sample thinks that they are influenced at high
average and at the average level.28% of the sample does not have any influence of price at
their purchasing.

Q 21. If other brands offering attractive schemes, will you change to other brand?

response
Sure

respondent
18

Often

24

Neutral

28

Not Sure

18

Never

12

57

Now a day it is the time of competition. So every company whether it is domestic or foreign
they want to join this competition. So each and every company is coming with a no. of
promotion schemes. If the other companies comes up with more attractive schemes then their
present then 42% think that they will shift to other company.28% remain neutral at this.12%
think that they will purchase cold drinks from the same company. These are hard core loyal to
the company.

Q 22. On what factor will you switch over to some other brands of cold drinks?

Response

respondent

Price

23

brand name

24

Taste

32

Promotional Scheme
Advertisement

7
21

58

When it comes to switch over from one brand to the other brand then the respondents mostly
consider price and the taste. Taste is most important in case of the cold drinks because
sometimes the people buy these cold drinks only on the basis of these.32% people going for
these services. Brand name also plays an important role.24% of the sample will switch over
with a brand name. Promotional Scheme also plays an important role. 7% thinks that they
will switch over to other brand with these promotional schemes.

Q 23. Are you satisfied with the overall performance?

response
Fully satisfied

respondent
22

Satisfied

23

Average

26

Less satisfied

21

dissatisfied

59

Satisfaction plays a very important role to the consumers as well as to the sellers. The sample
that I have taken shows that they most of them are satisfies with the cold drinks that they
have purchased.65 to 70% of the sample are Fully satisfied, Satisfied and average satisfied
with these cold drinks.29 % of the sample somehow are not satisfied with the cold drinks
whatever the reason may be like price, taste, promotional schemes etc.

Q 24. How is your post purchase experience with your past soft drinks?

response
Excellent

respondent
14

Very good

19

Good

32

Average

21

Poor

14

60

Post purchase behaviour means how the consumer reacts after the purchasing of sports shoes.
This is the behaviour on the basis of which the consumer repurchases.33% of the sample
thinks that their post purchase behaviour is very good, means the product that they wanted
from the seller meets their needs.53% of the sample that their post purchase behaviour is
good or average.14% of the sample thinks that their post purchase behaviour is poor

Q 25. How much you consume the cold drinks?

response
Daily

respondent
37

in the week

43

On any

20

occasion

61

People consume the cold drinks in regular basis. They consume these when they felt
trusty.37% people consume the cold drinks daily. 43%people consume on the interval basis or
in the week etc. 20% people takes on the any occasion

Findings

Total volume reached 523,000 million litres in 2007, giving a global per capita
consumption of around 67.5 litres per year.

62

 North America is the largest soft drinks market with 27 per cent of total world soft
drink sales and a consumption of 48 gallons per person per year (192 litres/ person /
year).
The market growth rate is presently 7-8% per annum.

44% of the people Prefer coke. 36% of the people Prefer Pepsi. 20% of the people
prefer other cold drinks

When it comes to know about awareness 21% comes through Publicity, 30% sample
comes across through Advertising 27% through friends &20% through family
members.

Brand name and taste are the most important factor which influences the purchase of
cold drinks.53% of the sample influence with these.

59% OF the samples are fully aware about the availability of the cold drinks that are
in the market.

When it comes to giving benefits to customers 57% sample thinks that coke provides
most.

Among the media T.V and magazine plays the very important Role.35% of the sample
are influenced by T.V.

64% of the respondents are aware about the different promotion activities done by the
various cold drinks company

63

 28% of the respondents prefer taste scheme while they are going for purchase. 25% of
the respondents prefer brand name

50% of the sample thinks that they are influenced at high average and at the average
level.32% of the sample does not have any influence of price at their purchasing.

65 to 70% of the sample are fully satisfied, Satisfied and average satisfied with these
cold drinks.29 % of the sample somehow are not satisfied with the cold drinks.

BIBLIOGRAPHY
WEBSITES1.

http://inventors.about.com/od/foodrelatedinventions/a/soft_drinks.htm

2.

http://inventors.about.com/library/inventors/blpepsi.htm
64

3.

http://inventors.about.com/od/cstartinventions/a/coca_cola.htm

4.

http://en.wikipedia.org/wiki/Pepsi

5.

http://in.news.yahoo.com/040325/137/2c759.html

6.

http://www.epa.gov/epaoswer/hazwaste/test/pdfs/8141a.pdf

7.

http://www.chinashoesexpo.com/en/news0507_6.asp

8.

http://www.coca-cola.co.uk/Mission_Vision_and_Values/

9.

http://wiki.answers.com/Q/What_is_pepsi_mission_statement
http://www.pepsico.com/Pep_Citizenship/sustainability/visionstrategy/mission_values
/index.cfm

BOOKS:

1) Suja R. Nair, Consumer Behaviour in Indian Perspectives (First Edition: 2001),

Himalaya Publishing House, Mumbai-400004. Chapter 1, PP 3-6.
2) David L. Loudon and Abert J. Della Bitta, Consumer Behaviour and

concepts and

applications, Fourth Edition, Tata Mc Graw Hill, New Delhi, PP 5-8,9,19 .

3) Leon G. Schiffman and Lesli Lazar kanauk, Consumer Behaviour, Eight Edition,
Prentice Hall of India, New Delhi, PP 8,9,11,19,20.
4) Frank R. Kardes, Consumer Behaviour and Managerial decision making, Second
Edition, PP 23,47.
5) Murray R. Spiegel, Theory and Problem of Statistics, Third edition, Tata Mc Graw
Hill Publication, Chapter 12, 14.
6)

S.P.Gupta and M.P. Gupta, Business Statistics, Twelth Edition, Sultan Chand and
Sons Publications. PP 237-241,628-629.

7) T.R. Jain and Dr. S.C. Aggarwal, Statistics For M.B.A,

8) G.C. Beri, Marketing research, Third Edition, Tata Mc graw Hill Publications PP 9598,233.
9) Donald S. Tull and Del Hawkins, Marketing Research Measurements and Methods,
Sixth Edition, PP 49, 330, 355, Chapter 22.
65

10) Philip Kotler, Principles of Marketing, Ninth Edition. PP 8,9.

11) Kothari C.R., Research Methodology Methods and Techniques (Second Edition) New
Age International Publishers, Ansari Road, Daryaganj, New Delhi-110002. Chapter 4,
Page 55-58. Chapter 6, Page 95,100,111.
12) Business Research Methodology (Eighth Edition) by Donald R. Cooper and Pamela
S. Schindler, Tata McGraw Hill Publishing Company Limited, New Delhi. Chapter 3,
Page 82, 86, 87. Chapter 4, Page 101,102.
Journal & Magazine

The Square Trap - Page 21 by Irving Shulman - Fiction 1976

Eating Disorders: Time for Change - Page 8 by Mona Villapiano, Laura J. Goodman -

Psychology - 2001
Living Backwards: A Transatlantic Memoir - Page 68 by Carl Dawson - Social

Science
Operations Management: Critical Perspectives on Business and Management - Page

88
by Michael Lewis, SLACK & LEWIS, Nigel Slack - Business & Economics - 2002
Forbidden Fruit - Page 486 by Erica Spindler - Fiction 1996
The Living Age - Page 429 by Making of America Project, Eliakim Littell, Robert S.

Littell - American literature 1858

Caribbean Islands - Page 620 by Sarah Cameron - Travel 2003
Bali & Lombok - Page 97 by Ryan Ver Berkmoes, Lisa Steer-Guerard - Travel 2005
Manual of Cutaneous Laser Techniques - Page 32 by Tina S. Alster - Medical 2000
Salaula: The World of Secondhand Clothing and Zambia - Page 174 by Karen

Tranberg Hansen - Social Science

The Elements of Marketing - Page 226 by Paul Dulaney Converse - Marketing 1952
Food and Beverage Management - Page 355 by Bernard Davis, Andrew Lockwood,

Sally Stone - Business & Economics 1998

Pop Fiction: The Song in Cinema by Steve Lannin, Matthew Caley - Music 2005

66

Annexure

Questionnaire

Name of the respondent: -

Age:Sex:Occupation:-..
Income level:-

67

1. Which cold drinks are you drinking?

Pepsi

La coke

Any other
2. What type of pack of cold drinks are you using?
200ml

500ml

1 ltr

any other

3. Which brand of cold drinks are you drinking?

thumps up

slice

any other

Mirinda
Id

7up

2. How did you come to know about these brands of cold drinks?

Through friends

Family members

Advertisement

Any other

Publicity

3. Which factor influence you more to purchase the cold drinks

Price

Scheme

Brand Name

6.

Taste

Why did you prefer this service provider? How do you grade the following qualities?
1

Price

Brand Name

68

taste

need

consumption

7. Are you aware about the all scheme available in the market?
Fully aware

Aware

Less aware

Neutral

Not so much

8. weight these brands according to your preference?

pepsi

7up

coke

mirinda

limca

9. Arrange these companies according to you which company gives the most benefits to
customers?

pepsi

coke

10. Which type of media influences your purchase behaviour?

T.V

Hording

Newspaper

Magazine

Wall painting

11. Do TV and hoardings contain sufficient and understandable information?

Fully satisfied

Satisfied

Average

Less satisfied

Dissatisfied

69

12. Who influenced you more in your buying decision of cold drinks?

Self

Family member

Friends/relatives

13.. In your opinion, what role advertisement plays?

Provides important details

Give information

Creates awareness

Convenience in purchase

Misleading
14 Which Companys Advertisement you like most:
pepsi

coke

15. Where you can see that Advertisement: T.V

Posters

ii Road shows
internet

Hoardings
16.

How much you are involved in the various promotional activities by cold drinks

companies?
More involvement

Normal involvement

Less involvement

No involvement

17 Are you aware about different promotion activity done by cold drinks companies?
Yes

No

18 How many other soft drinks do you know? Specify name.

70

19. Which of the following is most preferred by you during purchase of cold drinks?

Price

brand name

taste

consumption

Need
20. What extent brand name influences your purchase of soft drink?
High

High Average

Average

Average Low

Low
21. If other brands offering attractive schemes, will you change to other brand?
Sure

Often

Neutral

Not Sure

Never
22. On what factor will you switch over to some other brands of cold drinks?

price

brand name

taste

Promotional Scheme

23. Are you satisfied with the overall performance?

Fully satisfied

Satisfied

Average

Less satisfied

Poor

71

24.

How is your post purchase experience with your past soft drinks?

Excellent

Very good

Good

Average

Poor

25. How much you consume the cold drinks?

Daily

in the week

On any occasion

26.

Does the soft drinks company meet the quality consistency as

Offered / required?
Fully satisfied

Satisfied

Average

Less satisfied

Dissatisfied

27. Are you interested to have the same cold drinks in future?
Sure

Often

Neutral

Not Sure

Never
28. Would you like to recommend the cold drinks brand to your
Friend/Relatives?

72

Highly Recommend

Recommend

Neutral

Not Recommend

Never Recommend

Multi Dimension Scaling

Q6.Why did you prefer this Cold drinks? Grade the following factors in Rank 1 to 5
1-Most preferred

Group1

5-Less preferred

Group2

73

Group3

Group4

Group5

BRAND NANE

TASTE
PRICE
CONSUMPTION
NEED

47

44

49

52

46

68

62

61

59

66

53

55

51

49

56

64

62

67

61

58

72

68

71

74

70

XLSTAT 7.1 - Multidimensional Scaling (MDS) - 3/27/2008 at 5:16:18 PM

Similarity matrix (converted to a dissimilarity matrix): workbook = Book1 / sheet = Sheet1 /
range = $B$2:$F$6 / 5 rows and 5 columns
Uniform weighting (default)
No missing values
Metric Multidimensional Scaling
Multidimensional Scaling model: absolute
Stress used for the results: Kruskal's stress-1
Dimension of the representation space: 5
Repetitions: 10
Seed of the pseudo-random numbers generator: 3757803258
Iterations: 50
Convergence: 0.0001

Space with 5 Dimensions:

Model: Dij= Pij

Observation coordinates:
Observation
group1
group 2
group 3
group 4
group 5

Dim1
2.529
-2.446
-0.912
0.489
0.340

Dim2
0.068
0.143
-0.196
-0.002
-0.012

Dim3
5.404
7.192
-8.968
-2.741
-0.887

74

Dim4
2.611
2.369
-3.836
-0.873
-0.271

Dim5
1.478
-0.002
-1.297
-0.187
0.009

Distances measured in the representation space:

group1
group1
group 2
group 3
group 4
group 5

0
5.496
16.363
9.243
7.405

group 2
5.496
0
17.430
10.856
8.945

group 3
16.363
17.430
0
7.126
9.019

group 4
9.243
10.856
7.126
0
1.966

group 5
7.405
8.945
9.019
1.966
0

Ideal distances calculated using the model (disparities):

group1
group 2
group 3
group 4
group 5
group1
0
6.000
21.000
10.000
2.000
group 2
6.000
0
19.000
12.000
6.000
group 3
21.000
19.000
0
7.000
3.000
group 4
10.000
12.000
7.000
0
0.000
group 5
2.000
6.000
3.000
0.000
0
In the case of the absolute model, the disparities are equal than the dissimilarities

Residual distances:
group1
group1
group 2
group 3
group 4
group 5

0
-0.504
-4.637
-0.757
5.405

group 2
-0.504
0
-1.570
-1.144
2.945

group 3
-4.637
-1.570
0
0.126
6.019

Dissimilarit

Disparity

Distance

group 4
-0.757
-1.144
0.126
0
1.966

group 5
5.405
2.945
6.019
1.966
0

Comparative table:
Pair

75

Dissimilarity

Disparity

Distance

y
rank
rank
group 4 - group 5
0.000
0.000
1.966
1
group1 - group 5
2.000
2.000
7.405
2
group 3 - group 5
3.000
3.000
9.019
3
group 2 - group 5
6.000
6.000
8.945
4
group1 - group 2
6.000
6.000
5.496
4
group 3 - group 4
7.000
7.000
7.126
5
group1 - group 4
10.000
10.000
9.243
6
group 2 - group 4
12.000
12.000
10.856
7
group 2 - group 3
19.000
19.000
17.430
8
group1 - group 3
21.000
21.000
16.363
9
In the case of the absolute model, the disparities are equal than the dissimilarities

76

rank
1
2
3
4
4
5
6
7
8
9

1
4
6
5
2
3
7
8
10
9

Summary of repetitions:
Initial

Fin.

Repetition
Iterations
stress
stress
1
20
0.715
0.311
2
22
0.684
0.311
3
21
0.656
0.311
4
21
0.674
0.311
5
22
0.767
0.311
6
21
0.675
0.311
7
19
0.641
0.311
8
22
0.757
0.311
9
22
0.656
0.311
10
21
0.690
0.311
In bold, repetition corresponding to the best solution that XLSTAT found

INTERPRETATION

4) At the Kruskals stress one G4 and G5 got the 1 st rank in dissimilarity, disparity and distance
that mean people lies in group 4 and in G5 have the same opinion regarding to the cold drinks
companies

5) At the stress level of 0.311 all the groups are not close to each other that means the groups
different from each other.

6) In the above multi dimensional scaling Model: Dij= Pij and the level of Convergence is
0.0001. Group 1 and Group 3 has the biggest rank so we can say that their is very less
possibility of agree ness between the two group

77

Q 23. Are you satisfied with the overall performance?

Group1

Group2

Group3

Group4

Group5

Fully satisfied

Satisfied

Average

Less satisfied

Poor

XLSTAT 7.1 - Multidimensional Scaling (MDS) - 3/26/2008 at 3:42:10 PM

Similarity matrix (converted to a dissimilarity matrix): workbook = Book1 / sheet = Sheet2 /
range = $B$2:$F$6 / 5 rows and 5 columns
Uniform weighting (default)
No missing values
Metric Multidimensional Scaling
Multidimensional Scaling model: absolute
Stress used for the results: Kruskal's stress-1
Dimension of the representation space: 5
Repetitions: 10
Seed of the pseudo-random numbers generator: 40317230
Iterations: 50
Convergence: 0.0001

Space with 5 Dimensions:

Model: Dij= Pij

78

Observation coordinates:

Observation

Dim1

Dim2

Dim3

Dim4

Dim5

G1

-0.104

0.166

0.303

0.225

0.597

G2

0.896

0.900

0.259

0.168

0.775

G3

-1.000

-0.348

0.447

0.341

0.740

G4

-1.079

-0.520

0.321

0.252

0.446

G5

1.288

-0.198

-1.330

-0.987

-2.558

Distances measured in the representation space:

G1

G2

G3

G4

G5

G1

1.255

1.059

1.202

4.020

G2

1.255

2.284

2.457

4.041

G3

1.059

2.284

0.382

4.588

G4

1.202

2.457

0.382

4.358

G5

4.020

4.041

4.588

4.358

Ideal distances calculated using the model (disparities):

G1

G2

G3

G4

G5

G1

1.000

1.000

1.000

4.000

G2

1.000

2.000

3.000

4.000

G3

1.000

2.000

0.000

5.000

79

G4

1.000

3.000

0.000

4.000

G5

4.000

4.000

5.000

4.000

In the case of the absolute model, the disparities are equal than the dissimilarities

Residual distances:

G1

G2

G3

G4

G5

G1

0.255

0.059

0.202

0.020

G2

0.255

0.284

-0.543

0.041

G3

0.059

0.284

0.382

-0.412

G4

0.202

-0.543

0.382

0.358

G5

0.020

0.041

-0.412

0.358

Comparative table:
Dissimilarit
Pair

Disparity

Distance

Dissimilarity

Disparity

Distance

rank

rank

rank

G3 - G4

0.000

0.000

0.382

G1 - G4

1.000

1.000

1.202

G1 - G2

1.000

1.000

1.255

G1 - G3

1.000

1.000

1.059

G2 - G3

2.000

2.000

2.284

G2 - G4

3.000

3.000

2.457

G4 - G5

4.000

4.000

4.358

G1 - G5

4.000

4.000

4.020

G2 - G5

4.000

4.000

4.041

G3 - G5

5.000

5.000

4.588

10

In the case of the absolute model, the disparities are equal than the dissimilarities

80

81

Summary of repetitions:

Repetition

Iterations

Initial

Fin.

stress

stress

27

0.559

0.103

28

0.569

0.103

27

0.614

0.103

26

0.541

0.103

28

0.573

0.103

27

0.620

0.103

29

0.563

0.103

27

0.648

0.103

28

0.575

0.103

10

27

0.616

0.103

In bold, repetition corresponding to the best solution that XLSTAT found

Interpretation
At the Kruskals stress one G3 and G4 got the 1 st rank in dissimilarity, disparity and
distance that mean people lies in group 3 and in 4 have the same opinion regarding to the
sports shoes companies.

At the stress level of 0.103 all the groups are not close to each other that means the
groups different from each other.

In the above multi dimensional scaling Model: Dij= Pij and the level of Convergence is
0.0001. Group 3 and Group 5 has the biggest rank so we can say that their is very less
possibility of agree ness between the two group

82