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DR. AKSHAY TYAGI (08BSHYD0049)

AMIT SINGH BISHT (08BSHYD0077)
ASHUTOSH KUMAR SHARMA (08BSHYD0160)
LAVEENA GUPTA (08BSHYD0839)
SUGANDHA CHAWLA (08BSHYD0375)
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INTRODUCTION

Consumer has been playing the key role in the business growth models of all sectors. The change
from ͞Push͟ to ͞Pull͟ strategy has opened up doors for research on the buying patterns and
thereby increasing the sales revenue. However, the pattern is distinct among the consumers in
various segments. Again the business segments have been trying hit and trial methods to
understand this change. All the studies carried in this aspect has attempted to categorize some
of the common attributes of consumer buying which has been supported by extreme market
research. Moreover these characteristics have provided fruitful results over a period of time.

RESEARCH QUESTION
What kind of consumer behavior (brand switching, stockpiling, purchase acceleration, product
trial and spending larger amounts) follows as a result of various sales promotion activities (free
gifts, personal demonstration, multi-brand promotional offers, sweepstakes or games,
guarantees or warranties) in a super market?

RESEARCH OBJECTIVES
The basic objective underlying this project is to analyze the response of the consumer towards
sales promotion activities. Previous research has shown that sales promotion can encourage
behavioral responses such as brand switching, stockpiling, purchase acceleration, product trial
and spending larger amounts. Through this research we intend to analyze what kind of behavior
follows as a result of non monetary sales promotion. The data then collected would be used to
answer two basic questions:

1.c Which behavior is most likely to be exhibited for a given sales promotional tool?
2.c Which kind of sales promotion is most effective in bringing about one particular
behavior?
3.c Are the sales promotion activities linked to each other and an overlapping of the
consumer behavior exists?
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1.c A Benefit Congruency Framework of Sales Promotion Effectiveness

-c Chandon ,Wansink and Laurent (2000)

The paper discusses that promotions provide consumers with different levels of three
hedonic benefits (opportunities for value-expression, entertainment, and exploration),
and three utilitarian benefits (savings, higher product quality, and improved shopping
convenience). Based on the distinction between the types of sales promotions and
promotion benefits, Chandon Wansink and Laurent showed that monetary promotions
 provide more utilitarian benefits whilst non-monetary promotions provide more hedonic
benefits.
Source: http://www.atypon-link.com/AMA/doi/abs/10.1509/jmkg.64.4.65.18071

2.c cA Review of Theoretical Perspectives Applied to Sales Promotion and a

New Perspective based on Mental Accounting Theory ʹ (2003-04)
------------ Priya Jha-Dang

This paper includes adaptation level theory, assimilation contrast theory, attribution
theory, prospect theory, transaction utility theory, the elaboration likelihood model and
the attitude model. It finds that these theoretical approaches have had a single product
focus in evaluating consumer response to promotions. It suggests an alternative
theoretical perspective to examine consumer response to promotion from a multi
product perspective.
Sources: http://ideas.repec.org/p/iim/iimawp/2004-03-04.html

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Heilman, Lakishyk and Radas (July 2006)
This research examines the impact of in-store free samples on ͞samplers͟ (those who
accept the free sample). It also provides insights about non-samplers (those who see the
sample but do not accept it) by comparing their behavior to that of samplers.

Source: http://www.commerce.virginia.edu/faculty_research/Research/Papers/FreeSamples_July26_2006.pdf

4.c Many other research and study has been done as mentioned in the above papers
literature review. The most common is the consumer response to price promotions
which was also confirmed in several laboratory studies (Gurumurthy and Winer, 1995,
Blattberg, Briesch and Fox 1995).

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The Research methodology was designed keeping in view various parameters. Some of which
are:

SAMPLING DESIGN
For the sake of convenience and in view of certain other limitations we restricted our sample to
the students and staff of ICFAI Business School, Hyderabad i.e. convenience (non probability)
sampling. Within the campus, however, we seek to target a sample of 125 respondents on the
basis of simple random (probability) sampling. This means that within ICFAI the respondents
would be chosen on a random basis with the probability of each being included in the sample is
equal. c

DATA COLLECTION
A thorough secondary data analysis was undertaken in order to plan the research. The
previously conducted researches on related topics provided us with the guidelines for the
further course of action. Primary data for the research collected through a questionnaire based
survey interview.

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The final questionnaire evolved after many stages of reformulating and restructuring. A - c
  was conducted with a sample of 10 respondents (male: female ratio of 2:1) prior to
conducting the actual interviews. This was done mainly to test the language of the questionnaire
and know whether the respondents interpreted the question as intended. Errors and Confusing
words were modified and certain explanations were added. A copy of the final questionnaire has
been attached as an annexure to the report. The questionnaire used was an adaptation of a
questionnaire used in a survey conducted by Shi, Cheung and Prendergast (2005). The
questionnaire was designed basically to extract the following information from the respondents:

1.c Basic demographic information regarding the age, gender, occupation and income.

2.c Their shopping frequency and their average spending per visit to the super market. Such
questions act as a screen to identify whether the respondents is aware of the super
market sales promotional activities or not. This is important in order to be able to get
unbiased responses. If the respondent is not clearly aware of such activities his responses
may be prejudiced or based on certain preconceived ideas.

3.c The responses of the respondents towards different types of sales promotion activities:
In this part the consumer was asked to rank the five different behaviors that he is likely
to exhibit as a result of a particular sales promotional activity on a scale of 1 to 5.

4.c The five types of promotional tools and the behavioral responses have been identified on
the basis of several past researches on related topic and through analysis of other
secondary data available on the topic. These responses were analyzed using various
statistical tools and helped us get answers to the research question.
DATA ANALYSIS
The data so collected will was compiled on basis of the demographic characteristics. Further, we
also compiled the ratings given to the different behaviors that follow in response to the given
sales promotional tools. The data then collected was used to answer the three questions:

The first question involved ranking the five behaviors in response to each of the five tools, thus
identifying the effectiveness of each specific tool in inducing the five behaviors. Single Factor
ANOVA was used to determine whether there is some considerable difference between the
behaviors in response to a given sales promotional tool. Thereafter, paired sample test was used
to rank these responses. The second analysis compared the effectiveness of the five promotional
tools in inducing individual buying behaviors i.e. the five tools were ranked in terms of the
behavior induced by each. This highlights which tools are most effective in inducing one specific
behavior. Again ANOVA would help determine variances in the tools used in successfully
inducing different behaviors and the paired sample test would enable us rank them for each
individual behavior.

Ëc LIMITATIONS
The following limitations were observed during the course of the research;

`c The Sample of respondents chosen was not a random sample and limited only to the
students of IBS, Hyderabad.
`c Due to limitation of sampling there was very little variance in the profile of the
respondents. Due to this effect of demographic variables could not be studied.
`c Lack of enthusiasm on the part of the respondents to answer the questionnaire.
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0 # (: (a) Male (b) Female


#: (a) Self-employed (b) Professional (c) Service (d) Student (e) Homemaker

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0 : (a) 18 to 25 (b) 25 to 35 (c) 35 to 50 (d) 50 to 65 (e) Above 65

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##'c,'1c# : (a) Below 1, 50,000
(b) 1, 50,000 - 3, 00,000
(c) 3, 00,000 ʹ 5, 00,000
(d) 5, 00,000 ʹ 7, 00,000
(e) Above 7, 00,000

How often do you shop in a super market?

(a) Once in two weeks
(b) Once a week
(c) Twice a week
(d) Three times a week
(e) Any other (please specify) _________________
What is your average expenditure per visit to a super market?
(a) < 1000
(b) 1000-2500
(c) 2500-5000
(d) 5000-7000
(e) >7000

The questionnaire aims to obtain your response to the five different kinds of sales promotional strategies
listed below. You are required to choose from the following options for each of the questions:
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a. A free gift has led me to buy another brand which I do not regularly buy. 1 2 3 4 5
b. A free gift has led me to buy the product earlier than planned. 1 2 3 4 5
c. A free gift has led me to buy more quantities of the same product. 1 2 3 4 5
d. A free gift has led me to buy a product which I have never tried before. 1 2 3 4 5
e. A free gift has led me to spend more in each visit to the supermarket. 1 2 3 4 5
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a. A demonstration has led me to buy another brand which I do not regularly buy. 1 2 3 4 5
b. A demonstration has led me to buy the product earlier than planned. 1 2 3 4 5
c. A demonstration has led me to buy more quantities of the same product. 1 2 3 4 5
d. A demonstration has led me to buy a product which I have never tried before. 1 2 3 4 5
e. A demonstration has led me to spend more in each visit to the supermarket. 1 2 3 4 5
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a. A multi brand offer has led me to buy another brand which I do not regularly buy. 1 2 3 4 5
b. A multi brand offer has led me to buy the product earlier than planned. 1 2 3 4 5
c. A multi brand offer has led me to buy more quantities of the same product. 1 2 3 4 5
d. A multi brand offer has led me to buy a product which I have never tried before. 1 2 3 4 5
e. A multi brand offer has led me to spend more in each visit to the supermarket. 1 2 3 4 5

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a. Sweepstakes or games have led me to buy another brand which I do not regularly buy. 1 2 3 4 5
b. Sweepstakes or games have led me to buy the product earlier than planned. 1 2 3 4 5
c. Sweepstakes or games have led me to buy more quantities of the same product. 1 2 3 4 5
d. Sweepstakes or games have led me to buy a product which I have never tried before. 1 2 3 4 5
e. Sweepstakes or games have led me to spend more in each visit to the supermarket. 1 2 3 4 5

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a. An additional guarantee has led me to buy another brand which I do not regularly buy 1 2 3 4 5
b. An additional guarantee has led me to buy the product earlier than planned. 1 2 3 4 5
c. An additional guarantee has led me to buy more quantities of the same product. 1 2 3 4 5
d. An additional guarantee has led me to buy a product which I have never tried before. 1 2 3 4 5
e. An additional guarantee has led me to spend more in each visit to the supermarket. 1 2 3 4 5