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CONSUMPTION BEHAVIOUR OF COFFEE AND TEA IN KARNATAKA

Thesis submitted to the University of Agricultural Sciences, Dharwad in partial fulfillment of the requirements for the Degree of

MASTER OF SCIENCE (AGRICULTURE)

In

AGRICULTURAL ECONOMICS

By

VARUN T.C.

DEPARTMENT OF AGRICULTURAL ECONOMICS COLLEGE OF AGRICULTURE, DHARWAD UNIVERSITY OF AGRICULTURAL SCIENCES, DHARWAD 580 005

JULY, 2008

ADVISORY COMMITTEE
DHARWAD JULY2008 (M. G. KERUTAGI) CHAIRMAN

Approved by:

Chairman: (Dr. M.G. KERUTAGI) Members: 1. (Dr. L. B. KUNNAL) 2. (Dr. R. BASAVARAJA) 3. (Mrs. ASHALATHA K. V.)

4.

(Dr. M.T. DODMANI)


.

CONTENTS
Sl. No.
CERTIFICATE ACKNOWLEDGEMENT LIST OF TABLES LIST OF FIGURES LIST OF APPENDICES 1. 2. INTRODUCTION REVIEW OF LITERATURE 2.1 2.2 2.3 2.4 3. 3.1 3.2 3.3 4. 4.1 4.2 4.3 4.4 4.5 5. 5.1 5.2 5.3 5.4 5.5 6. Factors influencing consumption Consumption pattern Brand preference and analytical tools and techniques used Health benefits of coffee and tea Description of the study area Sampling design Analytical tools and techniques employed General characteristics of the sample respondents Socio- economic factors influencing consumption of coffee and tea Consumption and expenditure pattern of coffee and tea Brand preference and its quality attributes of coffee and tea Health aspects related to coffee and tea consumption General characteristics of the sample respondents Socio- economic factors influencing consumption of coffee and tea Consumption and expenditure pattern of coffee and tea Brand preference and its quality attributes of coffee and tea Health aspects related to coffee and tea consumption

Chapter Particulars

METHODOLOGY

EXPERIMENTAL RESULTS

DISCUSSION

SUMMARY AND POLICY IMPLICATIONS REFERENCES

LIST OF TABLES
Table No.
3.1 4.1 4.2 4.3 4.4 4.5 4.6 4.7 Features of the study area Socio-economic profile of the respondents in the selected districts Classification of sample respondents based on age and income Decision makers in the family regarding food purchase Estimated equation for coffee and tea powder demanded Monthly expenditure pattern of urban and rural households Association between nativity and region in coffee and tea consumption Region-wise quantity purchased and expenditure per month among the sample respondents Distribution of beverage consumers based on region and nativity Age wise distribution of beverage consumers in the urban and rural regions of the sample study area Comparison between age group and frequency of coffee and tea consumption Comparison between age group and place of coffee and tea consumption Comparison between age group and quality of coffee and tea consumed during each serving Comparison between age group and quality of coffee and tea consumed during each day Brand preference among the selected respondents Brand loyalty among the selected respondents towards their respective coffee and tea brands Principle components for coffee Contd.

Title

4.8 4.9

4.10

4.11

4.12

4.13

4.14 4.15

4.16

Table No.
4.17 4.18 Principle components for tea

Title

Importance of attributes in preference of coffee and tea brands through Index method Relative importance and relative utility scores for different parameters of coffee in northern and southern Karnataka Relative importance and relative utility scores for different parameters of tea in northern and southern Karnataka Recommendations for coffee and tea consumption (Frequency) by the selected doctors Recommendations for coffee and tea consumption (Quality) by the selected doctors Benefits and effects of coffee and tea consumption as reported by the selected doctors

4.19

4.20

4.21

4.22

4.23

LIST OF FIGURES
Figure No.
1. 2. 3.

Title
Map depicting the study areas Pictorial depiction of the sample selection Graph showing the classification of sample respondents based on age Graph showing the classification of sample respondents based on income Graph showing the distribution of beverage consumers in North Karnataka Graph showing the distribution of beverage consumers in South Karnataka Graph showing importance of attributes in preference of coffee brands through Index method Graph showing importance of attributes in preference of tea brands through Index method

4.

5.

6.

7.

8.

LIST OF APPENDICES
Appendix No.
I. II. III. Interview schedule Plan cards for coffee through conjoint analysis Plan cards for tea through conjoint analysis

Title

1. INTRODUCTION
Coffee and tea are drunk in most countries, but typically one predominates. Coffee is the preferred drink in Europe and America, and tea elsewhere. Until the early eighteenth century, coffee production and consumption was confined to the Islamic countries and tea production to East Asia. European traders altered this pattern dramatically. The present pattern of coffee consumption is influenced by income per capita and that of tea is not. Religious influence played some role in the early development of both tea and coffee but have no much relevance at present.

1.1

History of coffee and tea

Coffee was first discovered in eastern Africa in Ethiopia. A popular legend refers to a goat herder by the name of Kaldi, who observed his goats acting unusually frisky after eating berries from a bush. Curious about this phenomenon, Kaldi tried eating the berries himself, and they gave him a renewed energy. The story of tea began in ancient China over 5000 years ago. According to legend, Shen Nung, an early emperor was a skilled ruler, creative scientist and patron of arts. His farsighted edicts required among other things, that all drinking water be boiled as a hygienic precaution. One summer day, while visiting a distant region, he stopped to rest. There the servants began boiling water for him to drink. It was here that few leaves from the nearby bush fell into the boiling water, and a brown liquid was infused into the water. The emperor was interested in the new liquid, drank some and found it very refreshing. And so, according to legend, tea was created.

1.2

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.

1.3

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. However, the number of cups consumed daily per drinker of coffee across India is 2.1 cups, broadly in line with the 2 cups consumed per drinker of tea. The studies by zone and age show that coffee consumption increases significantly in winter months in both the north and the east across all ages groups. Northern India is a key target area for the promotion of coffee. The region has a vast population but per capita consumption of coffee is only around 10 grams as opposed to an average 54 grams in the rest of the country. In the past, coffee was regarded as an "old fashioned" beverage for older people, with just two flavours: regular and decaf. Coffee, of late has become relevant and contemporary. Coffee houses or bars have sprung up across the country, making coffee an important part of social gathering places. In many communities, coffee bars have become innovative: some provide personal computers so that customers can surf the Net, while others provide match-making services. There is a wide variety of coffee offerings, from size, flavour, preparation and toppings and plenty of gourmet and specialty shops to provide them.

For the last few years, new product trends have been driven specifically by consumer demand for more complex, upscale coffee, both in and outside of their homes. The increased sophistication of coffee drinkers palate means that coffee as a whole is moving away from the Cuppa-Joe image and towards a richer, more complex drinking experience. So, as the trend towards single cup preparation at home is building more and more momentum, packaging innovators are looking at how-to best present pods to these consumers on retail shelves. 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.

1.4

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.

1.5

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.

1.6

Hypotheses
1. Coffee and tea are consumed regularly by the people of Karnataka. 2. Socio-economic factors have a positive influence on the consumption pattern of coffee and tea. 3. Consumers are indifferent to different brands of coffee and tea. 4. Coffee and tea consumption cures certain disorders in human beings.

1.7

Limitations of the study

The present study has limitation of time and other resources commonly faced by the student researchers. However, considerable care has been taken in making the study as systematic as possible. The findings of the study may not be generalized beyond the boundaries of the area under investigation and such other area having dissimilar socioeconomic conditions.

2. REVIEW OF LITERATURE
In this chapter, a review of past research works in the field has been compiled to enable better understanding of the research in various regions, method of analysis on the research subject. The chapter is presented under the following headings. 2.1 2.2 2.3 2.4 Factors influencing consumption Consumption pattern Brand preference and analytical tools and techniques used Health benefits of coffee and tea

2.1

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.

2.2

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.

2.3

Brand preference and analytical tools and techniques used

Hutchinson and Robertson (1979) used conjoint analysis to identify the quality attributes which had a profound influence on the marketability of rose. Form, variety, colour and price were the chosen attributes for the study. An interesting finding of the study was that price was relatively unimportant among buyers scheme of things while purchasing roses. Variety and arrangement of rose were found to have significantly influenced the buyers purchase decision. Prince et al. (1980) conducted a study on the consumer preference for quality attributes of rose using conjoint analysis. Price, variety and the bloom stage of rose were the major attributes that influenced the purchase decision. 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 first preference to taste. Freshness, crispness, brand, price and availability were the other attributes given importance to, in the same order as written above, by the consumers. Shafer and Kelly (1986) had taken up a market survey to identify the consumer preferences for quality attributes while buying potted chrysanthemums. Price, longevity and cultivar were the quality attributes short-listed for the survey. The survey results revealed that longevity scored over price in influencing the consumers decision on buying chrysanthemums. Cultivar was identified as the most important quality attribute of chrysanthemum. Steenkamp (1987) used conjoint analysis technique to analyze the quality attributes of ham. The study was conducted in Netherlands with a sample size of 250 ham consumers. Quality attributes like brand, packaging, store and price received a relative importance of 29.3, 43.8, 10.0 and 17.0 per cent, respectively. On an average, packaging was found to be the most important quality attribute. Gerhardy and Ness (1995) used conjoint analysis technique to obtain the relative importance attached by the consumer to the quality attributes of eggs. The study was conducted using a sample of 160 respondents from five locations in the United Kingdom. It was observed that the method of production received the highest relative importance (30.4

%). Price, origin and freshness indicators (date of packing), in the same order were also considered important by the consumers. Solheim and Lawless (1996) conducted a study to analyze the consumer preference for food containing less fat. The results of the study indicated that low price and low fat content increased the purchase probability of foods. Amitha (1998) studied the consumer preference for selected dairy products in Bangalore city using conjoint analysis. Sample sizes of 200 respondents were chosen randomly from selected localities. The results of the study revealed that granular texture, wellcooked flavour, golden brown colour and low price were the preferred attributes for ghee. For table butter, the quality preferences expressed by consumers were good spread ability, low salt content, price and colour. Richard and Praduman (2002) in their study found that the main categories of foodstuffs consumed by the rural households of Maharashtra were cereals, pulses, milk and milk products, fats and oils, meat, eggs and fish, vegetables, fruits, sugar and jaggery. The consumption of various foodstuffs by the sample households was computed on a per consumer unit per day basis. The results revealed that cereals were consumed in largest quantities across all the socio-economic groups. These were followed by milk and milk products while the least consumed items were meat, eggs and fish. The reasons expressed by the respondents were, because of traditional persuasions or for economic reasons. Consumption increased with increase in the per capita expenditure. There was an increase in consumption of all foodstuffs with an increase in the education level of households heads and the size of land owned. Nandagopal and Chinnaiyan (2003) conducted a study on brand preference of soft drinks in rural Tamil Nadu, using Garrets ranking technique to rank factors influencing the soft drinks preferred by rural consumers. They found that, the product quality was ranked first, followed by its retail price. Good quality and availability were the main factors which influenced the rural consumers of a particular brand of a product. Sampath kumar (2003) studied the brand preference of soft drinks. The study was carried out in the rural areas of Telangana region and urban areas of the capital city of Andhra Pradesh i.e, Hyderabad. A simple non-probabilistic convenience sampling method was used to understand the behavior of consumers towards brand preference in soft drinks. The total sample size for the study was 400 respondents, of which 200 were rural consumers. The results indicated that more than 65 per cent of urban and rural consumers preferred Thums-up and Coco-cola, while less than two per cent of the rural and urban consumers preferred orange flavored drinks like Frooti and Miranda. Consumers were also asked to reveal the place of purchase of soft drink. The findings revealed that 27 per cent of urban and 26 per cent of the rural consumers buy soft drinks from super bazaars and 67 per cent of urban and 73 per cent of rural consumers make their purchases at the nearest kirana stores. Banumathy and Hemameena (2006) conducted a study to analyze the brand preference of soft drinks in the global environment. The study was conducted in Virudhunagar district of Tamil Nadu. The results indicated that the brand preference among the consumers was related to personal attributes like age, educational qualification, occupational status and monthly income. They concluded that after globalization most of the respondents preferred international brands. Orange taste was the one which was preferred the most. They suggested that by effective advertising, improving the quality by keeping a check on the taste and prices could promote demand for a particular brand. Maruthamuthu et al., (2006) conducted a study on consumer behaviour and brand preference of Britannia biscuits. The study revealed that 41 per cent of the respondents purchased for brand image, 31 per cent for quality and 24 per cent for its low prices while 12 per cent of the respondents preferred it for its availability. It also indicated that 21 per cent of the respondents were influenced by parents to make purchase decisions, 49 per cent by children and 21 per cent and 9 per cent of the respondents were influenced by friends and neighbours respectively. They suggested that introduction of new product line and offering gifts would keep the sale constant. Also, introduction of hygienic and attractive packaging without increasing the price may attract more consumers.

Anandan et al., (2007) studied the brand preference of washing soaps in rural areas of Tamil Nadu. The study revealed that quality is the major driver to prefer a particular brand in washing soaps in rural market. If the preferred brand were not available, customers brought the available brands. Further, there was a significant relationship between the age of the respondents and the factors influencing the customers brand preferences. Low marginal retail price, suitability of the soaps for saline water and availability were the major factors influencing the customers brand preferences. Higher price and non availability were the key reasons for dissatisfaction of the rural customers. They concluded that the marketers should target the customers with high quality soaps at affordable prices. They also emphasized to concentrate on distribution strategies.

2.4

Health benefits of beverages

Maridakis (2006) in his research observed that those who consumed caffeine one hour before starting exercising had a 48 per cent reduction in pain compared to others. Respondents who took caffeine before exercise showed 26 per cent reduction in soreness. The researcher suggested that caffeine likely works by blocking the bodys receptors for adenosine, a chemical released in response to inflammation. Choi (2007) analyzed data from a US health and nutrition survey between 1998 and 1994. The study was based on a survey of 50,000 men aged between 40 and 75 years with no history of gout. They filled a detailed questionnaire about dietary habits, including what they drank. Over the 12 years of the study, during which 757 men developed gout, the risk was lower for those who drank more coffee. The researcher found lower levels of uric acid in the blood of those who consumed large quantities of coffee. Coffee could hold the secret of curing male baldness, according to new research. Scientists have discovered caffeine stimulates the growth of tiny follicles in the scalp in men who are starting to lose their hair. Italian researchers (2007) have found that having one or two cups of coffee a day could protect a person from eye tremors- a condition in which there is sustained, forced, involuntary closing of the eyelids. The researchers had found a significant association with those who drank coffee. Mayo clinic (2007) conducted a series of research to know the health benefits of coffee. A study of more than 27,000 post-menopausal women concluded that coffees antioxidant properties may inhibit inflammation and consequently development of cardiovascular diseases. They also found that routine coffee consumption, particularly decaffeinated coffee, substantially lowered the risk of type II diabetes. Nurses Health (2007) study found that low levels of caffeine intake reduced the risk of Parkinsons disease in women who used post-menopausal hormone therapy. In women who dint use hormones, caffeine intake at moderate to high levels decreased the risk of Parkinsons. They highlighted the health risks of coffee too. It showed that high levels of caffeine, i.e. six or more cups a day increased the risk of Parkinsons in women who used hormone therapy. US scientists have evidence that the combination of daily exercise and a cup of coffee may prevent skin cancers. They also found that coffee may also help manage asthma and even control attacks when medication is unavailable. It can stop a headache, boost mood and even prevent cavities according to the study.

3. METHODOLOGY
This chapter 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. 3.1 3.2 3.3 Description of the study area Sampling design Analytical tools and techniques employed

3.1

Description of the study area

Karnataka is the eighth largest state in India with an area of 1, 91, 791 sq km. It is situated between 11.5 and 19.0 North latitude and between 74.0 and 78.0 East longitude in the southern plateau. According to 2001 census, Karnataka has a total population of 52.81 million, comprising of 26.86 million males and 25.95 million females, with an overall literacy rate of 67.04 per cent. Rural population is about 34.88 million and urban population accounts for 17.92 million. The population density of the state is 275.50 per sq km. The average annual rainfall of the state if about 1139 mm from both South-West and North-East monsoons. The mean temperature ranges from 10.0 C to 44.0C. The study was conducted in four districts of Karnataka, namely, Bangalore and Kodagu from south and Dharwad and Belguam from Northern Karnataka.

3.1.1 Description of Bangalore district


King Veeraballa of Vijayanagar christened the city of Bangalore "Benda Kalu Ooru"(place of baked beans) to commemorate a certain memorable incident. This urban metropolis is the capital city of Karnataka and happens to be the fastest growing metropolis in India, covering an area of 2170 sq. km in Southwestern Deccan Plateau, Bangalore is located at 1297' North and 77 56' East. The district is enclosed by Kolar District in the northeast, Tumkur District in the northwest, Mandya District in the southwest, Chamarajanagar District in the south and the neighbouring state of Tamil Nadu in the southeast, respectively. With a growing population estimated at 8.5 million, Bangalore ranks fifth in terms of population in India. Bangalore has a male population of around 4.3 million and a female population of approximately 4 million. It is the fastest growing metropolis with the country's fourth largest economy. The core of the booming Information Technology industry, the upcoming biotechnology sector and several other large and small-scale industries are located in the district.

3.1.2 Description of Kodagu district


Kodagu (Coorg) District, the erstwhile kingdom of the Hoysalas and Vijayanagar is a picture perfect hill station in Karnataka that houses a treasure trove of diverse culture. The geographical area of Kodagu is 4102 sq. km and is encircled by Dakshina Kannada, Hassan, Mysore and Kannur District of Kerala state and Wayanad district of Kerala. The 2001 Census quotes Kodagu's population indices at 5,48,561, with 2,74,831 male and 2,73,730 females. This rural district's economy depends primarily upon agriculture, plantation and forestry. The coffee plantations and orange groves of Coorg are renown all over the world. Kodagu District's pristine verdant forests and sun kissed terrains specked by snow white coffee blossoms captivate tourists.

Figure 1: Map depicting the study areas

3.1.3 Description of Dharwad district


The etymological significance of the term "Dharwad" is a resting place. However, the district's nomenclature is shrouded in conjectures and surmises. With a 900-year-old history, once a kingdom of the Chalukyas; is now the focal point of North Karnataka's academic, economic and industrial development. Occupying an expanse of 13,738 sq. km and lying to the east of the Western Ghats, the twin cities of Hubli-Dharwad is strategically located at 420 km north and 550 km south of the urban metropolis of Bangalore and Mumbai, respectively. Supporting a population of 1.6 million, comprising of 8,23,204 males and 7,81,049 females, the inhabitants of Dharwad practice agriculture and also are engaged in industry and commerce. The district is famous for its mouth-watering milk based pedhas.

3.1.4 Description of Belguam district


Belgaum District sited in the Western Ghats in Karnataka and also recognized by the nom de plum 'Venugrama' or 'Bamboo Village' and Malendu or 'Rain Country' is shrouded in history dating back to antiquity. Strategically located midway between the metropolis of Mumbai and Bangalore, Belgaum District occupies 13,444 sq. km area. The population indices are estimated to be 42,147,505 with 21,50,090 males and 20,64,415 females. Belgaum, renown for its exquisite cotton and silk weavings has a predominantly agrarian economy which is complemented by a multi-dimensional industrial base. Belgaum is a traveler's paradise with its verdant landscape dotted with meandering rivers. The old British Cantonment, majestic historical fort, Kamala Basti, Kapileshwar temple (South Kashi), the hills of Vaijyanath, Ramtirth in Kanbargi and the aerodrome at Sambra are worth visits.

3.2

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.

Table 3.1: Features of the study area

Sl. No.

Particulars General features

unit

Karnataka

Bangalore

Kodagu

Dharwad

Belguam

1 2 3 4

Total area Number of districts Number of sub districts Number of villages Demographic features

Sq. kms no's no's no's

191791 27 176 29406

8005 12 2572

4102 3 296

4260 5 379

13415 10 1270

1 a. b. 2 3 4 a. b.

Population Males Females Decadal growth rate Sex ratio Literacy rate (total) Males Females

Mn Mn Mn Per cent no's Per cent Per cent Per cent

52.85 26.89 25.95 17.51 965 66.60 76.10 56.90

8.40 4.38 4.02 23.5 931 73.85 80.95 66.25

0.54 0.27 0.27 12.00 996 78.00 83.70 72.30

1.60 0.82 0.78 17.00 949 71.60 80.80 61.90

4.21 2.15 2.06 17.00 960 64.20 75.70 52.30

Source : Directorate of Economics and Statistics (2006-07)

Fig. 2: Pictorial depiction of the sample selection

3.2.2 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 Younger age group Middle age group Older age group 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. Range (Years) Up to 35 35 50 Above 50

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 Low income group Middle income group High income group Income range (Rs) Up to 11,375 11,375 to 23,125 Moe than 23,125

3.3

Analytical tools and techniques employed

The collected data was tabulated and analyzed. The tools used for the analysis are as follows.

3.3.1 Tabular analysis


Percentage analyses were used to study the socio-economic characteristics of the sample respondents like age, educational status, religion, occupation, family size and type. The consumption behaviour of consumers towards beverages, place of purchase, frequency of consumption and quantity purchased were also analyzed using percentage analysis.

3.3.2 Statistical analysis


The following statistical tests and analyses were carried out to draw a meaningful inference. 3.3.2.1 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 2 2 2 distribution of chi-square is equal to Z1 + Z2 +,.+Zn 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) 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 ----------------------------- Sp2[(1/n1) + (1/n2)]

With (n1 + n2 2) degrees of freedom Where, X1m X2m n1 n2 Sp2 S


2

= Mean of the first group = Mean of the second group = Number of observations of the first group = Number of observations of the second group = Pooled variance and is given by, = (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 X1 X2 X3 X4 X5 = Demand for coffee and tea (kgs per month) = Age (number of years) = Education (number of years of professional schooling completed) = Family size (number) = Total family income (Rs. per month) = 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 twofactor-at-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. The beverage attributes were identified through personal observation and discussion with the advisory committee. Five attributes were chosen for the study. They are namely, brand, price of the brand, type of packaging, taste and form of the beverage powder were chosen. For selection of the beverage brand, its popularity among the respondents was taken into consideration. The profiles describing the beverage was constructed by combining the levels of the five attributes. Each combination of the attribute levels represents a specific brand alternative. For example, Nescafe instant coffee powder which has a sealed packing, with strong taste and medium price represents a coffee alternative.

These attributes and levels resulted in 19 profile solutions. Since, the number of all possible combinations of these 5 attributes was too large for evaluation, a computer software package, SPSS (Statistical Package for Social Sciences) was employed to select a subset of 16 beverage profiles which represent the most likely ones. Each profile was described on a separate card called plan cards. For each beverage, the respondents who consumed that beverage were interviewed. Each respondent was shown a randomly mixed set of 16 plan cards and was asked to rank them accordingly to their own perception. The ranks provided by them to these 16 cards were noted down. For each attribute/respondent, part-worth as well as relative importance of each attribute was estimated using conjoint analysis through the computer software package.

3.3.6 Principle Component Analysis


Principal components are a set of new variables which are mutually uncorrelated and exhibit maximum variance, which are the linear combinations of Xs. P1 = a11X1+a12X2+. + a1k Xk P2 = a21X1+a22X2+. + a2k Xk PK = aK1X1+aK2X2+. + aKk Xk The method of principal components has wide applications in the social and biological sciences. In econometrics it is appropriate in two cases

1. When the number of explanatory variables to be included in the model is very large
relative to sample size.

2. When K is greater than n, the function cannot be estimated. Even with large sample if
K is greater, the computation becomes difficult and degrees of freedom to check the reliability would be low. This method is suggested as a solution to the problem of multicollinearity. The method is also being used in the field of index numbers in order to assess the reliability of such indexes. The method of principal components is a special case of more general method of Factor Analysis. The aim of principal component is the construction out of a set of variables Xjs [j=1k of new variables (Pi)]. They are called principle components which are the linear combinations of Xs. Principal component can be carried by using, 1. 2. 3. Original value of Xjs. Their deviations from means. xj = Xi-Xj Standard variables, Zj = (Xi-Xj)/ SXj

In the study, the variables which had factor loadings more than 0.6 were selected and those with less than 0.6 were deleted.

3.3.7 Performance of brand preference through indices


The data on different attributes for the beverages are collected by using the 4 point scoring method as given below. Details Strongly agree Agree Disagree Strongly disagree Scores given 4 3 2 1

Mean scores are calculated by using the formula, (N1 X 4 + N2 X 3 + N3 X 2 + N4 X 1)./N Where, N N1 N2 N3 N4 = N1 + N2 + N3 + N4 = Number of respondents who strongly agree = Number of respondents who agree = Number of respondents who disagree = Number of respondents who strongly disagree

The opinion index was calculated based on the mean scores by using the formula, Obtained scores of respondents -----------------------------------------------Maximum obtainable score

100

4. RESULTS
In consonance with the objectives of the study, the data collected from different sources were analyzed and interpreted. The results of the study are presented under the following heads. 4.1 4.2 4.3 4.4 4.5 General characteristics of the sample respondents. Socio-economic factors influencing consumption of coffee and tea Consumption and expenditure pattern of coffee and tea Brand preference and its quality attributes of coffee and tea Health aspects related to coffee and tea consumption

4.1

General characteristics of the sample respondents.

The characteristics of the sample households like education, occupation, religion and family type were assessed and presented in Table 4.1. The total number of samples selected was 240 households, of which 120 were selected from North Karnataka comprising of Dharwad and Belguam districts and the remaining 120 were selected from Southern Karnataka comprising Bangalore and Kodagu districts. From these four districts equal numbers of respondent households were selected from the urban and rural areas.

4.1.1 Educational status


The total number of sample households was 240, comprising 120 households each from urban and rural areas. The distribution of the respondents based on educational profile indicate that majority of them in the urban regions were graduates (29.20%), it was followed by PUC degree holders (21.70%) and SSLC (20.00%). Only 14.20 per cent of the urban respondents were illiterate. But in the case of rural areas it was completely different, wherein more than 50 per cent of the respondents were illiterates. Around 19.20 and 11.70 per cent of the respondents from the rural areas had completed their primary and high schooling, respectively. Among the total selected respondents, 32.50 per cent were in the illiterate category, around 16.25 per cent were graduates and 15.00 per cent of them were PUC holders.

4.1.2 Family particulars of the sample respondents


Majority of the respondents were living in nuclear families, while only 17.50 per cent of the total sample households were of joint family type. In the urban and rural areas too the scene was not much different. Seventeen (14.20%) and 25 (20.80%) of the sample households were living in joint families, while the rest majority, i.e., 85.50 and 79.20 per cent of the respondents were living in nuclear families. Analyzing the religion of the sample households, Hindus were a majority with 82.90 per cent followed by Muslims, Christians and Jains with 12.90, 3.80 and 0.40 per cent respectively. Looking into the urban and rural areas separately, 84.2 and 81.70 per cent of the sample households were belonging to the Hindu religion, followed by Muslims occupying a share of 12.50 and 13.30 per cent in the urban and rural areas respectively.

4.1.3 Occupational status of the sample respondents Lot of diversity was found in the occupational status of the respondents. The top three slots were occupied by government employees (30.00%), business (20.83%) and agriculture (18.33%) in the urban areas, while in the rural areas, agriculture (69.17%), government employees (10.83%), private employees (7.50%) and business (7.50%) occupied the top three slots.

Table 4.1: Socio-economic profile of the respondents in the selected districts Variables Education Categories Illiterate Urban 17 (14.20) Primary schooling 8 (6.70) High schooling 6 (5.00) SSLC 24 (20.00) PUC 26 (21.70) Degree 35 (29.20) Post Graduation 4 (3.30) Total 120 (100.00) Religion Hindu 101 (84.20) Muslim 15 (12.50) Christian 3 (2.50) Jains 1 (0.80) Total 120 (100.00) Rural 61 (50.80) 23 (19.20) 14 (11.70) 8 (6.70) 10 (8.30) 4 (3.30) 120 (100.00) 98 (81.70) 16 (13.30) 6 (5.00) 120 (100.00) Total 78 (32.50) 31 (12.92) 20 (8.33) 32 (13.33) 36 (15.00) 39 (16.25) 4 (1.67) 240 (100.00) 199 (82.92) 31 (12.92) 9 (3.75) 1 (0.42) 240 (100.00) Contd

Variables Occupation

Categories Agriculture

Urban 22 (18.33)

Rural 83 (69.17) 13 (10.83) 9 (7.50) 9 (7.50) 6 (5.00) 120 (100.00) 25 (20.80) 95 (79.20) 120 (100.00)

Total 105 (43.75) 49 (20.42) 28 (11.67) 3 (1.25) 34 (14.17) 8 (3.33) 13 (5.42) 240 (100.00) 42 (17.50) 198 (82.50) 240 (100.00)

Govt. employee

36 (30.00)

Private employee

19 (15.83)

Retired employee

3 (2.50)

Business

25 (20.83)

Labourer

2 (1.67)

Home-maker

13 (10.83)

Total

120 (100.00)

Family type

Joint

17 (14.20)

Nuclear

103 (85.80)

Total

120 (100.00)

Note: Figure in parentheses indicate percentage to the total number respondents from each nativity (n=120).

4.1.4 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. Considering the urban and rural households separately, urban sector had the least number of respondents (17.50%) in the low income group category, while the rural sector had the highest at 55.80 per cent. Respondents belonging to the middle and high income group categories in the urban areas were 27.50 and 55.00 per cent, respectively. In the rural areas, there were 21.70 per cent respondents who belonged to the middle income group and 22.50 per cent of the respondents income was above Rs. 23,125.

4.1.5 Decision making in the family regarding food purchase


The decision regarding the purchase of food items were taken up jointly by the family members in around 41.70 per cent of the sample households in the urban areas, while the figure stood at 45.80 per cent in the case of rural regions. The family heads were taking all the family decisions in 32.50 and 23.30 per cent of the households in urban and rural households, respectively. The wives of the respondents were the major decision takers regarding the food items in 24.20 and 30.80 per cent of the sample households. Of the total sample households, 43.80 per cent of them agreed that all the members of their family were equally involved in taking decisions in the family, while in about 27.90 per cent cases, all the decisions were taken solely by the family head. Wives too were the sole decision makers in about 27.50 per cent of the sample households, while mothers were the decision makers in only 0.80 per cent of the cases.

4.2

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 in Table 4.4.

Table 4.2: Classification of sample respondents based on age and income

Sl. No. 1. a.

Classification Age groups Young age group (up to 35 years) b. Middle age group (35 - 50 years) c. Old age group (above 50 years) Total

Urban

Rural

Total

33 (27.50) 58 (48.30) 29 (24.20) 120 (100.00)

28 (23.30) 60 (50.00) 32 (26.70) 120 (100.00)

61 (25.40) 118 (49.20) 61 (25.40) 240 (100.00)

2. a.

Income groups Low income group (less than 11,375) 21 (17.50) 33 (27.50) 66 (55.00) 120 (100.00) 67 (55.80) 26 (21.70) 27 (22.50) 120 (100.00) 88 (36.70) 59 (49.20) 93 (38.80) 240 (100.00)

b.

Middle income group (11,375-23,125)

c.

High income group (more than 23,125) Total

Note: Figure in parentheses indicate percentage to the total in their respective column.

Rural
50 45 40 35 Percentage 30 25 20 15 10 5 0 Young age group Middle age group Age group

Urban

Old age group

Fig. 3: Age-wise classification of sample respondents

60

Rural

Urban

50

40 Percentage

30

20

10

0 Low income group Medium income group Age group High income group

Fig. 4: Income-wise classification of sample respondents

Table 4.3: Decision makers in the family regarding food purchase Decision makers Urban 39 (32.50) 29 (24.20) 2 (1.70) 50 (41.70) 120 (100.0) Rural 28 (23.30) 37 (30.80) 55 (45.80) 120 (100.0) Total 67 (27.90) 66 (27.50) 2 (0.80) 105 (43.80) 240 (100.0)

Family head

Wife

Mother

Whole family together

Total

Note: Figure in parentheses indicate percentage to the total in their respective column.

Table 4.4: Estimated equation for coffee and tea powder demanded

Coffee powder Urban Intercept Age a b1 0.76 7.17E-04 Rural 1.62 -1.76E-03

Tea powder Urban 0.33 7.80E-03 Rural 0.32 -2.10E-03

Education

b2

0.12**

-5.41E-02

6.60E-03

-3.05E-02

Family size

b3

4.40E-02

0.18**

3.45E-02

0.10**

Total family income

b4

1.15E-05

1.65E-07

7.83E-06*

7.00E-06

Price per unit


2

b5

-4.97E-03

-5.17E-03**

-1.30E-03

-1.54E-03

0.59

0.67

0.53

0.51

Price elasticity

-2.28E-05

-3.47E-05

-5.59E-06

-1.26E-05

Income elasticity

1.19E-03

1.22E-05

0.96E-03

0.97E-03

Note: E indicate 10^ (10 raised to the power) * ** : : Significant at 5 per cent level of significance Significant at 1 per cent level of significance

4.2.1 Factors influencing the consumption of coffee and tea


A perusal of Table 4.4 reveals that only education turned out to be statistically significant at one per cent level of significance with respect to coffee consumption in urban 2 areas. The co-efficient of multiple determination (R ) was 0.59 implying a good fit to the data. It could be observed that family size and income had a positive influence on coffee demanded, while the price per unit of coffee negatively influenced the demand for coffee. In the rural areas, the scenario was quite different. Family size and the price per unit of coffee were highly significant (at one per cent level of significance), while the rest of the factors like age, education and total family income were not significant. The co-efficient of multiple determination was 0.67. In case of tea, the total family income turned out to be highly significant in urban areas, while in the rural areas it was family size which was highly significant. All the other 2 variables were found to be non-significant and R was found to be 0.53 for urban and 0.51 for rural areas indicating a good fit to the data. The price elasticity of coffee powder was found to be high in the urban areas than the rural. Similarly, the income elasticity was also high in case of the urban areas. The price and income elasticity in the case of tea powder was high in the case of rural areas.

4.3

Consumption and expenditure pattern of coffee and tea

The consumption and the expenditure pattern of the respondents on coffee and tea is studied under this topic. In order to get a clear picture, the respondents have been divided according to their region and nativity.

4.3.1 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. For all the parameters, the urban people spent significantly more compared to their rural counterpart, which is quite evident from t-values. But only in case of total quantity of coffee and tea powder purchased and percentage of income spent on coffee and tea powder, the t-value stood non-significant at both one per cent and five per cent level of significance.

Table 4.5: Monthly expenditure pattern of urban and rural households

Mean values Sl. No. Parameters Urban Rural Overall mean t-value

1.

Coffee and tea powder

a.

Total quantity purchased (kgs)

1.25

1.16

1.20

1.01 ns

b.

Total expenditure (Rs)

235.13

160.39

197.76

3.70**

c.

Per cent of income spent

1.17

1.33

1.25

-1.58 ns

2.

Milk

a.

Total quantity purchased (ltrs)

29.13

24.76

26.94

3.09**

b.

Milk total expenditure (Rs)

475.42

402.49

438.95

3.38**

c.

Per cent of income spent on milk

2.87

5.07

3.97

-5.96**

3.

Total food items

a.

Total expenditure (Rs)

2620.93

2129.88

2375.40

4.95**

b.

Per cent of income spent

16.46

23.88

20.17

-3.99**

Note:

ns * **

: : :

Significant at 5 and 1 per cent level of significance Significant at 5 per cent level of significance Significant at 1 per cent level of significance

Table 4.6: Association between nativity and region in coffee and tea consumption Urban Beverage Zones Consumer s 7 (11.70) Coffee South 49 (81.70) North Tea South 29 (48.30) 60 (100.00) 60 (100.00) 13 (21.70) 25 (41.70) 4 (6.70) 31 (51.70) 26 (43.30) 60 (100.00) 60 (100.00) 1 (1.70) 23 (38.30) 8 (13.30) 34 (56.70) 0.3 ns 59 (98.30) 11 (18.30) 1 (1.70) 38 (63.30) 60 (100.00) 22 (36.70) 5.05* Nonconsumer s 53 (88.30) Rural Consumer s Nonconsumer s 60 (100.00) value
2

North

7.43**

1.01ns

North Milk South

47 (78.30) 35 (58.30) 56 (93.30) 60 (100.00)

59 (98.30) 37 (61.70) 52 (86.70) 60 (100.00)

North Horlicks/ Boost South

11.64**

0.14 ns

North Ragi malt South

1.48

ns

Note: Figure in parenthesis indicate the percentage to number of respondents from each district (n=60). ns * ** : : : Non-significant at 5 and 1 per cent level of significance Significant at 5 per cent level of significance Significant at 1 per cent level of significance

4.3.2 Association between nativity and region in coffee and tea consumption
In the north zone, only seven (11.70%) out of the total 60 sample households in the urban areas consumed coffee, while there were no takers for coffee in the rural regions. In the south, the situation was very different, with 81.70 per cent in the urban and around 38 (63.80%) in the rural areas preferring coffee. Whereas, 59 (98.30%) in the urban and 100 per cent in the rural areas went for tea, in the north zone. In south, the numbers stood at 29 (48.30%) and 26 (43.30%) for urban and rural households for tea consumption. Milk was consumed in all the sample households in both the urban and rural regions of both the zones. But only few sample households preferred having Horlicks/boost and ragi malt in both the urban and rural regions of both the zones. The figures for Horlicks/boost stood at 13 (21.70%) and one (1.70%) in the urban and rural regions of the north, respectively, and for the south it was 25 (41.70%) and 23 (38.30%) in the urban and rural regions respectively. Ragi malt was preferred by only 4 (6.70%) sample households in the urban regions of the north and in the rural, the figure stood at 8 (13.30%) households. While there were no takers for it in the southern part. With respect to coffee, there is an association between consumption of coffee and nativity, both in case of north and south regions. Chi-square was found to be highly significant in north at 7.43 and significant in south with a value of 5.05. In case of Horlicks/boost there is a highly significant association between the nativity and the consumption of boost or Horlicks. There is no association between the nativity and consumption of tea and ragi malt in both the zones. There was 100 per cent consumption of milk in rural as well as urban region.

4.3.3 Region-wise quantity purchased and expenditure per month among the sample respondents
Coffee powder was purchased by 94 households of the 240 households selected for the study. In the south alone, 87 households consumed coffee at an average of 1.09 kgs per month spending on an average Rs. 190.70. In the north zone, only seven households consumed coffee with a mean monthly expenditure of Rs. 70.43. There was a clear difference in the quantity purchased and the total expenditure on coffee in the north and the south zone. It is evident from the highly significant t-value which was 9.40 and 8.78, respectively. The per capita consumption and expenditure on coffee powder was high in the south with a consumption of 0.24 kgs and expenditure of Rs. 43.98. The mean quantity of tea powder purchased in the north as well as in the south was only 0.76 kgs, whereas the expenditure incurred in the north was much lower than in the south at Rs. 128.36 as against Rs. 86.84. The per capita consumption in the south was 0.10 kgs and in the north it was 0.25 kgs. The per capita expenditure in the south and the north was Rs. 17.52 and Rs. 28.83, respectively. This is clear from the t-value of 3.18, which was highly significant. Milk was purchased by all the selected households, both in the north as well as in the south, but the quantity of purchase varied with 30.52 litres in the south and 23.37 litres in the north. The t-value was highly significant at one per cent level of significance. The total expenditure incurred on milk also varied significantly in both the zones that is evident from the t-value of 3.49. Horlicks/Boost/Bournvita was consumed by 48 sample households in the south and 14 households in the north. The total quantity purchased in the south was 0.74 kgs and in the north it was 0.54 kgs. The total expenditure incurred in the north was less (Rs. 160.71) compared to the south (Rs. 219.38). The t-value was highly significant in both the cases at 2.98 and 2.87 for the quantity purchased and the expenditure incurred, respectively.

4.3.4 Distribution of beverage consumers based on region and nativity


Table 4.8 reveals that tea was the highest consumed beverage among all the beverages, when all the family members in the sample households were considered in both the regions of Karnataka with 57.30 and 51.50 per cent of the people consuming tea in the northern and southern regions, respectively. Similar pattern was seen in coffee with 22.50 and 19.00 per cent consumption in the north and south regions of Karnataka. In the north, 1.30 per cent and 12.10 per cent in the south consumed both coffee and tea. Boost/Bournvita/ Horlicks were consumed by more number of people in south with 6.30 per cent, than in the north (3.50%). About seven per cent in the north and 5.60 per cent in the south preferred drinking coffee and Boost/Bournvita/ Horlicks. Tea and Boost/Bournvita/ Horlicks were preferred only by the southern people to the tune of 2.10 per cent. Ragi malt and tea were preferred by 2.60 per cent people in the north and 1.30 per cent of the respondents in the south, while 5.90 per cent and 2.10 per cent of the people preferred drinking plain milk in the north and south regions of Karnataka, respectively. The number of respondents who consumed tea were 226 (50.30%) in the urban and 280 (58.00%) in the rural. Coffee was consumed by 91 (20.30%) respondents in the urban and 102 (21.10%) respondents in the rural areas. Horlicks/boost, basically a childrens drink was consumed more in the urban regions at 6.70 per cent (30 nos.) and in the rural areas, it was consumed by 16 (3.30%) respondents. Plain milk was consumed by 31 (6.40%) respondents in the rural and 6 (1.30%) respondents in the urban regions. In the urban areas there were around 53 (11.80%) respondents who drank both coffee and tea, while in the rural areas only 11 (2.30%) respondents had both coffee as well as tea. In the case on coffee and boost, it was consumed by 27 (6.00%) and 31 (6.40%) respondents in urban and rural regions respectively. About 6 and 12 respondents in the urban and rural areas consumed both tea and ragi malt. Tea and boost was consumed by a very negligible percentage (2.20%) of the urban sample respondents.

4.3.5 Age wise distribution of beverage consumers in the urban and rural region of the sample study area
Table 4.9 gives detailed information regarding the consumption of beverage by the children and adults in urban and rural areas of the sample study area. Respondents below 14 years of age were considered under the childrens category. Out of 117 childrens details obtained from the sample households in the urban region, 43 (36.80%) drank tea, followed by Horlicks/boost (23.90%) and coffee (12.00%) in the urban region. Plain milk too was consumed by 5.10 per cent of the children in the sample households. Coffee and tea; coffee and Horlicks/boost; tea and Horlicks/boost was consumed by 7.70, 8.50 and 6.00 per cent of the children in the urban areas. In the rural areas, there were 146 children in the 120 sample households, of which 68 (46.60%) drank only tea followed by plain milk. Horlicks/boost and coffee was consumed by only 14 (9.60%) and 6 (4.10%) children in the rural area, respectively. About 1.40 and 17.10 per cent of the children drank coffee and tea; and coffee and boost, respectively. The adult scenario in the urban and rural areas was not quite different. Tea being the hot favourite was consumed by 50.30 and 62.90 per cent of the sample respondents in the study area. Coffee was consumed by 77 (23.20%) respondents in the urban, and 96 (28.50%) respondents in the rural areas. Tea and ragi malt were consumed by 1.80 and 3.60 per cent of the adult respondents in the urban and rural areas, respectively. About 13.30 per cent (44 nos.) in the urban and 2.70 per cent (9 nos.) in the rural areas drank both coffee as well as tea. Coffee and Horlicks/boost was consumed by 17 (5.10%) and 6 (1.80%) adult respondents in the urban and rural areas, respectively.

Table 4.7: Region-wise quantity purchased and expenditure per month among the sample respondents South No. of respondents Coffee powder Quantity purchased (kgs) Total expenditure (Rs) ea powder Quantity purchased (kgs) Total expenditure (Rs) Milk Quantity purchased (kgs) Total expenditure (Rs) Horlicks/Boost Quantity purchased (kgs) Total expenditure (Rs) Ragi malt powder Quantity purchased (kgs) Total expenditure (Rs) 0.00 0.00 0.00 0.00 0.00 0.00 12 12 1.42 17.00 0.04 0.51 48 48 0.74 219.38 0.10 28.55 14 14 0.54 160.71 0.02 5.46 2.985** 2.87** 120 120 30.52 502.75 9.56 158.02 120 120 23.37 420.68 7.93 142.71 5.234** 3.491** 55 55 0.76 128.36 0.10 17.52 119 119 0.76 86.84 0.25 28.83 0.093ns 3.188** 87 87 1.09 190.70 0.24 43.98 7 7 0.35 70.43 0.01 1.32 9.404** 8.789** Mean Per capita No. of respondents North Mean Per capita t-value

Note:

ns * **

: : :

Non-significant at 5 and 1 per cent level of significance Significant at 5 per cent level of significance Significant at 1 per cent level of significance

Table 4.8: Distribution of beverage consumers based on region and nativity Beverages Tea North 260 (57.30) 102 (22.50) 16 (3.50) 27 (5.90) 6 (1.30) 31 (6.80) 12 (2.60) 454 (100.00) value
2

South 246 (51.50) 91 (19.00) 30 (6.30) 10 (2.10) 58 (12.10) 27 (5.60) 6 (1.30) 10 (2.10) 478 (100.00) 409.93**

Urban 226 (50.30) 91 (20.30) 30 (6.70) 6 (1.30) 53 (11.80) 27 (6.00) 6 (1.30) 10 (2.20) 449 (100.00)

Rural 280 (58.00) 102 (21.10) 16 (3.30) 31 (6.40) 11 (2.30) 31 (6.40) 12 (2.50) 483 (100.00) 66.22**

Coffee

Horlicks/Boost

Plain milk

Coffee and Tea

Coffee and Boost

Tea and Ragi malt

Tea and Boost Total

Note: Figure in parentheses indicates percentage to their respective columns

**

Significant at 1 per cent level of significance

Coffee and Boost 7% Coffee and Tea 1%

Tea and Ragi malt 3% Tea and Boost 0%

Plain milk 6% Horlicks / Boost 4%

Coffee 23%

Tea 56%

Fig. 5: Distribution of beverage consumers in North Karnataka

Coffee and Boost 6%

Tea and Ragi malt 1% Tea and Boost 2%

Coffee and Tea 12%

Plain milk 2%

Horlicks / Boost 6%

Tea 52% Coffee 19%

Fig. 6: Distribution of beverage consumers in South Karnataka

Table 4.9: Age wise distribution of beverage consumers in the urban and rural region of the sample study area

Urban Beverage Children Adults Total Children

Rural Adults Total

Coffee

14 (12.00)

77 (23.20) 183 (55.10) 2 (0.60) 6 (1.80) 44 (13.30) 17 (5.10) 3 (0.90) 332 (100.0) 114.76**

91 (20.30) 226 (50.30) 30 (6.70) 6 (1.30) 53 (11.80) 27 (6.00) 10 (2.20) 6 (1.30) 449 (100.0)

6 (4.10) 68 (46.60) 14 (9.60) 2 (1.40) 25 (17.10) 31 (21.20) 146 (100.0)

96 (28.50) 212 (62.90) 2 (0.60) 12 (3.60) 9 (2.70) 6 (1.80) 337 (100.0) 173.11**

102 (21.1) 280 (58.0) 16 (3.30) 12 (2.50) 11 (2.30) 31 (6.40) 31 (6.40) 483 (100.0)

Tea

43 (36.80)

Boost

28 (23.90)

Tea and Ragi malt

Coffee and Tea

9 (7.70)

Coffee and Boost

10 (8.50)

Tea and Boost

7 (6.00)

Plain milk

6 (5.10)

Total

117 (100.0)

2 value

Note: Figure in parentheses indicate percentage to their respective columns ** : Significant at 1 per cent level of significance

4.3.6 Association between age group and consumption pattern


The respondents from the 240 sample households were categorized into three age groups, namely, young, middle and old age group. The young age group consisted respondents below 35 years of age, respondents between 35and 50 years were grouped under middle age group and those above 50 years were grouped under old age group. 4.3.6.1 Frequency of coffee and tea consumption The number of times the respondents consumed their coffee and/or tea is presented below for different age groups. 4.3.6.1.1 Frequency of coffee consumption The frequency of coffee consumption was higher among the urban respondents, with 37.40 per cent consuming three cups in a day. In the rural areas more number of the respondents consumed two cups in a day (59.80%). Among the young age group, 22 (52.40%) respondents in the urban areas had two cups of coffee in a day, while 59.40 per cent of the rural respondents consumed coffee two times in a day. In the middle age group highest number of respondents (50.00%) in the urban areas consumed three cups of coffee in a day, while in the rural areas 58.70 per cent of the respondents belonged to the category. The same scenario was found even among the old age group, with 41.20 per cent in the urban consuming their coffee three times in a day and 62.50 per cent consumed coffee two times in a day. 4.3.6.1.2 Frequency of tea consumption Among the tea consumers, 48.70 per cent in the urban and 61.40 per cent in the rural consumed tea twice in a day. Most of the respondents belonging to young age group consumed tea twice in a day. The figures were 62.80 per cent for the urban and 71.10 per cent for the rural. Among the middle age respondents, 46.40 per cent in the urban areas had tea three times in a day, while in the rural; about 50.00 per cent of them consumed tea two times in a day. Among the old age category too, most of the respondents in the urban (51.20%) as well as in the rural (48.70%) consumed tea twice in a day. 4.3.6.1.3 Frequency of coffee and tea consumption There were few respondents who consumed both coffee as well as tea. There were 29 (54.70%) respondents in the urban and 7 (63.60%) respondents in the rural, with a frequency of two cups in a day. 4.3.6.2 Place of coffee and tea consumption The place where the respondents consumed their coffee and/or tea is presented below for the three different age groups. 4.3.6.2.1 Place of coffee consumption Most of the respondents drank coffee in their home, across all age groups and nativity. Seventy six per cent of the respondents in the urban and 32 (100.00%) respondents in rural sectors of the young age group; 70.50 and 95.70 per cent in the urban and rural sectors of the middle age group; 94.10 and 95.80 per cent in the urban and rural sectors of the old age group, respectively, drank their coffee only at their homes. Those who had drank coffee both at their home and office, their figure stood at 14.30, 18.80 and 5.90 per cent for the urban areas across young, middle and old age group. Majority of the respondents (80.20 % in urban and 97.10 % in rural) had their coffee only at their homes. 4.3.6.2.2 Place of tea consumption In case of tea also, majority of the respondents had it at their homes. Around 79.20 per cent from the urban and 92.10 per cent from the rural consumed their tea only in their respective houses.

Table 4.10: Comparison between age group and frequency of coffee and tea consumption Younger age group Urban Rural Coffee Once per day Twice per day Thrice per day Four times a day Five times a day Six times a day Total Tea Once per day Twice per day Thrice per day Four times a day Five times a day Six times a day Total Once per day Twice per day Thrice per day Four times a day Five times a day Six times a day Total 11 (9.10) 70 (62.80) 21 (17.10) 10 (8.30) 3 (2.50) 115 (100.00) 1 (3.40) 18 (62.10) 8 (27.60) 2 (6.90) 29 (100.00) 8 (5.40) 100 (71.10) 29 (19.50) 6 (4.00) 143 (100.00) 5 (71.40) 1 (14.30) 1 (14.30) 7 (100.00) 1 (1.40) 19 (27.50) 32 (46.40) 12 (17.40) 3 (4.30) 2 (2.90) 69 (100.00) 1 (7.70) 6 (46.20) 4 (30.80) 2 (15.40) 13 (100.00) 2 (2.20) 45 (50.00) 27 (30.00) 13 (14.40) 3 (3.30) 90 (100.00) 2 (50.00) 2 (50.00) 4 (100.00) 15 (41.70) 12 (33.30) 7 (19.40) 2 (5.60) 36 (100.00) 5 (45.50) 1 (9.10) 3 (27.30) 1 (9.10) 1 (9.10) 11 (100.00) 2 (2.20) 21 (51.20) 10 (24.40) 5 (12.20) 3 (7.30) 41 (100.00) 12 (5.30) 110 (48.70) 65 (28.80) 29 (12.80) 6 (2.70) 4 (1.80) 226 (100.00) 2 (3.80) 29 (54.70) 9 (17.00) 9 (17.00) 3 (5.70) 1 (1.90) 53 (100.00) 12 (4.30) 172 (61.40) 66 (23.60) 24 (8.60) 6 (2.10) 280 (100.00) 7 (63.60) 3 (27.30) 1 (9.10) 11 (100.00) 4 (9.50) 22 (52.40) 11 (26.20) 4 (9.50) 1 (2.40) 42 (100.00) 19 (59.40) 9 (28.10) 3 (9.40) 1 (3.10) 32 (100.00) 7 (21.90) 16 (50.00) 6 (18.80) 3 (9.40) 32 (100.00) 27 (58.70) 14 (30.40) 2 (4.30) 2 (4.30) 1 (2.20) 46 (100.00) 3 (17.60) 7 (41.20) 5 (29.40) 2 (11.80) 17 (100.00) 15 (62.50) 7 (29.20) 2 (8.30) 24 (100.00) 4 (4.40) 32 (35.20) 34 (37.40) 15 (16.50) 6 (6.60) 91 (100.00) 61 (59.80) 30 (29.40) 7 (6.90) 2 (2.00) 2 (2.00) 102 (100.00) Middle age group Urban Rural Older age group Urban Rural Total Urban Rural

Coffee and tea together

Note: Figure in parentheses indicate percentage to their respective columns

Table 4.11: Comparison between age group and place of coffee and tea consumption Young age group Urban Coffee Home Home and office Home and hotel Home, office & hotel Total Tea Home Home and office Home and hotel Home, office & hotel Total Coffee & tea together Home Home and office Home and hotel Home, office & hotel Total 32 (76.20) 6 (14.30) 1 (2.40) 3 (7.10) 42 (100.00) 105 (86.80) 9 (7.40) 3 (2.50) 4 (3.30) 121(100.00) 19 (65.50) 5 (17.20) 5 (17.20) 29 (100.00) 32 (100.00) 32 (100.00) 141 (94.60) 5 (3.40) 3 (2.00) 149(100.00) 6 (85.70) 1 (14.30) 7 (100.00) 25 (78.10) 6 (18.80) 1 (3.10) 32 (100.00) 46 (66.7) 13 (18.8) 1 (1.4) 9 (13.00) 69 (100.00) 7 (53.8) 5 (38.5) 1 (9.1) 13 (100.00) 44 (95.70) 2 (4.30) 46 (100.00) 82 (91.10) 5 (5.60) 3 (3.30) 90 (100.00) 2 (50.00) 1 (25.00) 1 (25.00) 4 (100.00) 16 (94.10) 1 (5.90) 17 (100.00) 28 (77.80) 5 (13.90) 3 (8.30) 36 (100.00) 8 (72.70) 2 (18.20) 1 (9.10) 11 (100.00) 23 (95.80) 1 (4.20) 24 (100.00) 35 (85.40) 1 (2.40) 5 (12.20) 41 (100.00) 73 (80.20) 13 (14.30) 1 (1.10) 4 (4.40) 91 (100.00) 179 (79.20) 27 (11.90) 4 (1.80) 16 (7.10) 226(100.00) 34 (64.20) 12 (22.60) 7 (13.20) 53 (100.00) 99 (97.10) 1 (1.00) 2 (2.00) 102(100.00) 258 (92.10) 11 (3.90) 11 (3.90) 280(100.00) 8 (72.70) 2 (18.20) 1 (9.10) 11 (100.00) Rural Middle age group Urban Rural Old age group Urban Rural Urban Total Rural

Note: Figure in parentheses indicates percentage to their respective columns

4.3.6.2.3 Place of coffee and tea consumption Most of respondents consumed their coffee or tea only in the houses. Of the total 53 respondents from the urban and 11 respondents from the rural, coffee and tea was consumed by 22.60 per cent in the urban and 18.20 per cent in the rural areas had coffee and/or tea in their homes as well as in their respective offices. 4.3.6.3 Quantity of coffee and tea consumed each time The amount of coffee and tea which was actually consumed per serving by the respondents is discussed below. The measurements were only approximations and not exact figures. 4.3.6.3.1 Quantity of coffee consumed each time There were around 91 respondents from the urban and 102 respondents from the rural areas who consumed coffee. Majority of the coffee drinking respondents on an average consumed 100 ml of it during each serving. There were around 11 per cent in the urban and 10.80 per cent respondents in the rural who consumed 150 ml of coffee during each serving. 4.3.6.3.2 Quantity of tea consumed each time There were 226 respondents from the urban and 280 respondents from the rural who consumed tea. Unlike coffee, majority of these respondents had only 50 ml of tea at each serving. More then ninety per cent in the urban and about 88.20 per cent in the rural areas had only 50 ml of tea during each serving. 4.3.6.3.3 Quantity of coffee and tea consumed each time Among the respondents who consumed both coffee as well as tea, majority of them had 50 ml of the beverage at each serving. There were more number of respondents in the urban who consumed both coffee and tea in the urban (53 nos.) than in the rural (11 nos.). 4.3.6.4 Quantity of coffee and tea consumed per day The quantity of coffee and tea consumption is directly associated to the frequency and the quantity of its consumption during each serving. Here too the values are approximation of the total quantity and not the exact values. 4.3.6.4.1 Total quantity of coffee consumed per day The total quantity of coffee consumed in a day by the sample respondents was 100 to 250 ml by 22 (52.40%) respondents in the urban and 15 (46.90%) respondents in the rural, in the young age category. Among the middle age group, 22 (68.80%) respondents in the urban consumed 250 to 500 ml of coffee in a day while in the rural, 24 (52.20%) respondents consumed coffee to the tune of 100 to 250 ml in a day. In the old age group, more number of respondents (47.30%) in the urban areas consumed 250 to 500 ml of coffee in a day, while in the rural areas majority of the respondents (53.90%) consumed 100 to 250 ml of coffee in a day. 4.3.6.4.2 Total quantity of tea consumed per day In the urban areas, about 49.10 per cent of the respondents consumed tea within 100 ml in a day and in the rural their percentage was 56.80. Remaining 46.00 per cent of the urban respondents drank tea in the range of 100 to 250 ml in a day; while in the rural area it was 40.70 per cent who consumed tea to the tune of 100 to 250 ml in a day. 4.3.6.4.3 Total quantity of coffee and tea consumed per day The respondents consuming both coffee as well as tea was 37.70 per cent in the urban and 45.50 per cent in the rural drank up to 100 ml of it in a day. Another 37.70 per cent in the urban and 36.40 per cent in the rural drank their beverage to the tune of 100 to 250 ml in a day. Six per cent of the urban respondents drank their beverage to the tune of 500 to 1000 ml in a day, while in the rural areas there were no respondents who consumed this high quantity of either coffee or tea in a day.

Table 4.12: Comparison between age group and quantity of coffee and tea consumed during each serving Younger age group Urban Rural 12 (28.60) 28 (66.70) 2 (4.80) 42 (100.00) 14 (43.80) 15 (46.90) 3 (9.40) 32 (100.00) 128 (85.90) 21 (14.10) 149 (100.00) 4 (57.10) 3 (42.90) 7 (100.00) Middle age group Urban Rural 7 (21.90) 20 (62.50) 5 (15.60) 32 (100.00) 63 (91.30) 3 (4.30) 3 (4.30) 69 (100.00) 7 (53.80) 1 (7.70) 4 (30.80) 1 (7.70) 13 (100.00) 13 (28.30) 26 (56.50) 7 (15.20) 46 (100.00) 82 (91.10) 8 (8.90) 90 (100.00) 3 (75.00) 1 (25.00) 4 (100.00) Older age group Urban Rural 4 (23.50) 10 (58.80) 3 (17.60) 17 (100.00) 30 (83.30) 6 (16.70) 36 (100.00) 5 (45.50) 5 (45.50) 1 (9.10) 11 (100.00) 12 (50.00) 11 (45.8) 1 (4.2) 24 (100.00) 37 (90.2) 4 (9.8) 41 (100.00) Total Urban 23 (25.30) 58 (63.70) 10 (11.00) 91 (100.00) 205 (90.70) 4 (1.80) 15 (6.60) 2 (0.90) 226 (100.00) 30 (56.60) 1 (1.90) 18 (34.00) 4 (7.50) 53 (100.00) Rural 39 (38.20) 52 (51.00) 11 (10.80) 102 (100.00) 247 (88.20) 33 (11.80) 280 (100.00) 7 (63.60) 4 (36.40) 11 (100.00)

Parameters Coffee 25 ml 50 ml 75 ml 100 ml 150 ml 200 ml Total Tea

25 ml 112 (92.60) 50 ml 1 (0.80) 75 ml 6 (5.00) 100 ml 2 (1.70) 150 ml 200 ml 121 (100.00) Total Coffee and tea together 25 ml 18 (62.10) 50 ml 75 ml 9 (31.00) 100 ml 150 ml 2 (6.90) 200 ml 29 (100.00) Total

Note: Figure in parentheses indicates percentage to their respective columns. The measurements are approximate values.

Table 4.13: Comparison between age group and quantity of coffee and tea consumed during each day Parameters Coffee 0-100 ml 100-250 ml 250-500 ml 500-1000 ml Total Tea 0-100 ml 100-250 ml 250-500 ml 500-1000 ml Total 9 (21.40) 22 (52.40) 11 (26.20) 42 (100.00) 8 (25.00) 15 (46.90) 9 (28.10) 32 (100.00) 2 (6.30) 8 (25.00) 22 (68.80) 32 (100.00) 5 (10.90) 24 (52.20) 17 (37.00) 46 (100.00) 6 (35.30) 10 (58.80) 1 (5.90) 17 (100.00) 5 (20.80) 16 (66.70) 3 (12.50) 24 (100.00) 11 (12.10) 36 (39.60) 43 (47.30) 1 (1.10) 91 (100.00) 18 (17.60) 55 (53.90) 29 (28.40) 102 (100.00) Younger age group Urban Rural Middle age group Urban Rural Older age group Urban Rural Urban Total Rural

82 (67.80) 36 (29.80) 3 (2.50) 121 (100.00)

97 (65.10) 49 (32.90) 3 (2.00) 149 (100.00)

19 (27.50) 45 (65.20) 5 (7.20) 69 (100.00)

42 (46.70) 45 (50.00) 3 (3.30) 90 (100.00)

10 (27.00) 23 (63.90) 3 (8.30) 36 (100.00)

20 (48.80) 20 (48.80) 1 (2.40) 41 (100.00)

111 (49.10) 104 (46.00) 11 (4.90) 226 (100.00)

159 (56.80) 114 (40.70) 7 (2.50) 280 (100.00)

Coffee & tea together 0-100 ml 100-250 ml 250-500 ml 500-1000 ml Total 13 (44.80) 10 (34.50) 5 (17.20) 1 (3.40) 29 (100.00) 4 (57.10) 1 (14.30) 2 (28.60) 7 (100.00) 3 (23.10) 8 (61.50) 2 (15.40) 13 (100.00) 1 (25.00) 3 (75.00) 4 (100.00) 4 (36.40) 2 (18.20) 3 (27.30) 2 (18.20) 11 (100.00) 20 (37.70) 20 (37.70) 10 (18.90) 3 (5.70) 53 (100.00) 5 (45.50) 4 (36.40) 2 (18.20) 11 (100.00)

Note: Figure in parentheses indicates percentage to their respective columns. The measurements are approximate values.

4.4

Brand preference and its quality attribute of coffee and tea

Various brands of coffee and tea were preferred by the urban and the rural respondents. The list and the frequency of the respondents preferring those brands are presented in the topics below.

4.4.1 Brand preference of coffee and tea


The preference of brands among the sample households for coffee and tea are provided in the Table 4.14. Most of the respondents preferred coffee from their own plantation. These were basically from Kodagu district, wherein almost all the respondents were planters. Bru enjoyed the first place with 11.70 per cent of the responding opting it as their first preference and around 1.06 per cent of the respondents choose Bru as their second preference. Nescafe too was not far behind, giving close competition to its counterpart, it was the brand of first preference for about 10.64 per cent of the respondents and about 1.06 per cent of the respondents went for Nescafe as their brand of second preference. Kothas, Sunrise, Green label and TATA kapi were chosen by 6.38, 2.13, 2.13 and 1.06 per cent of the respondents as their brand of first choice. Majority of the sample households consumed tea with more number of commercially available brands (72.50%) than coffee. Around 36.21, 2.30 and 0.57 per cent of the sample respondents preferred Red Label as the first, second and third preference, respectively, implying that it was the most preferred brand among the sample respondents. About 25.29 per cent of them preferred locally available tea dust which was the second most preferred brand of tea among the respondents. TATA tea and Taj Mahal was preferred by 12.64 and 10.92 per cent of the sample respondents for their first choice and about 1.15 and 2.30 per cent opted for these two brands as their second choice respectively. Tea Gold, Golden, Gemini and Kora were among the least preferred brands among the sample respondents with just 0.57 per cent of the respondents opting for them.

4.4.2 Brand loyalty among the selected respondents towards respective coffee and tea brands
The percentage sample households who were loyal to their beverage brands were about 89 per cent and only 11.30 per cent were not brand loyal, as per the Table 4.15. Considering the urban and rural situation, we can observe that 87.50 per cent of the urban respondents were brand loyal while only 12.50 per cent of the sample respondents were not loyal to any brands. Similar pattern was observed in the rural area too, as found in the urban areas.

4.4.3 Principle component analysis for coffee


The principle component analysis (PCA) was employed to identify the factors influencing the consumption of coffee and/or tea by the selected families in all the four districts of Karnataka state. Table 4.16 presents the results of principle component analysis (PCA) for all the four districts (pooled) and the factor loading for all the selected 15 variables. Higher the factor loading of a variable on a particular dimension, higher will be its association with that dimension than its association with other dimensions. Thus, it is a general practice to discuss the variables with respect to a dimension on which they have higher factor loading. Out of fifteen variables considered, five principle components have been extracted. Based on these five components, influenced by others, celebrity endorsement, gifts or promotions and friends/ neighbour/relatives influence are the four attributes which are deleted in the case of urban people who consume coffee. In the case of coffee consumption in rural areas, brand name, retailers influence, attractive packaging, celerity endorsement and gifts/promotion are the four attributes which can be recommended for deletion, based on the extracted principle components.

Table 4.14: Brand preference among the selected respondents

Brands

Preference I Frequency %

Preference II Frequency %

Preference III Frequency %

Coffee Own Plantation Bru Nescafe Kothas Sunrise Green Label TATA Kapi Tea Red Label Tea dust TATA tea Taj Mahal Three roses Brook Bond Star Dust Green Label Gemini Golden Tea Gold Kora Agni 63 44 22 19 10 7 3 2 1 1 1 1 0 36.21 25.29 12.64 10.92 5.75 4.02 1.72 1.15 0.57 0.57 0.57 0.57 2 1.15 2 1 1 1.15 0.57 0.57 2 4 3 3 3 1.15 2.30 1.72 1.72 1.72 4 2.30 1 0.57 62 11 10 6 2 2 1 65.96 11.70 10.64 6.38 2.13 2.13 1.06 1 1 1.06 1.06 1 1 1.06 1.06

Table 4.15: Brand loyalty among the selected respondents towards respective coffee and tea brands

Region Nativity Urban Rural

Yes 105 (87.50) 108 (90.00) 104 (86.70) 109 (90.80) 213 (88.8)

No 15 (12.50) 12 (10.00) 16 (13.30) 11 (9.20) 27 (11.3)

value

0.376 ns

Zones

North

1.043 ns

South Total

Note: Figure in parentheses indicate percentage to the total number of respondents from each region of the study (n=120) ns : Non-significant at 5 and 1 per cent level of significance

4.4.4 Principle component analysis for tea


From Table 4.17, it is clear that three components, viz., retailers influence, influenced by others, celebrity endorsement and friends/ neighbour/relatives influence are the four attributes which are deleted in the case of urban people who consumed tea. The attributes such as quality, aroma, flavour, taste, colour of end product, brand name, reasonable price, timely availability, attractive packing, effective advertisement and gifts and promotions obtained higher factor loadings. In case of tea consumers in rural area, many attributes can be recommended for deletion; those are retailers influence, influenced by others, effective advertisement, celebrity endorsements, gifts/promotions and friends/neighbour/relatives influence. Six attributes, namely, quality, aroma, flavour, taste, colour of the end product, brand name, reasonable price and timely availability were retained in all the four cases.

4.4.5 Opinion indices of attributes for brand preference of coffee and tea
From the Table 4.18 it is clear that, quality, aroma, flavour and taste were the attributes which were strongly agreed by the respondents. The mean opinion indices were 97.66, 96.88, 95.31 and 92.19 respectively for these attributes in the urban areas. Colour of the end product, brand name, timely availability, attractive packing and effective advertisement were just agreeable for the respondent in urban areas. Reasonable price and retailer influence were the next preferred attribute. However, respondents in the urban disagreed for these four attributes, namely, influenced by others, celebrity endorsement, gifts/ promotions and friends/neighbour/relatives influence. In the rural area too, quality, aroma, flavour and colour of end product were found to be strongly agreed by the selected respondents, with indices values of 97.54, 98.77, 98.77 and 98.77 respectively. However, attributes like brand name, retailers influence, reasonable price and timely availability were rejected by the rural respondents. It can be observed in the case of tea that the urban respondents were in strong favour of quality, aroma. Flavour and taste, but did not bother much about the influence by retailers or relatives and friends. The index values were 100, 98.30, 97.44 and 96.59 for quality, aroma, flavour and taste, respectively. For the rural people too, quality was the main attribute, but aroma, flavour and taste did not influence them as much as to the urban people. Influence by retailers, friends or neighbours, attractive packing, effective advertisements and celebrity endorsements did not have much influence on the rural households.

4.4.6 Relative importance and utility for coffee powder


Table 4.19 provides information pertaining to relative importance and relative utility scores for various parameters of coffee in the Northern and Southern regions of Karnataka. The conjoint analysis showed that coffee consumers both in the north as well as south perceived the price of the coffee powder as the most important parameter as revealed by a score of 56.90 and 60.48 per cent, respectively. The relative importance given to the type of packaging was the least in the north and south with 6.92 and 5.93 per cent respectively.

Table 4.16: Principle components for coffee Rural 3 -0.857 0.359 0.195 0.359 0.195 9.76E-05 9.76E-05 9.76E-05 9.76E-05 2.84E-02 9.76E-05 9.76E-05 9.76E-05 9.76E-05 9.76E-05 7.13 75.516 Urban 3 -0.398 0.663 -0.373 0.131 0.389 0.292 0.456 -0.075 -0.527 0.050 0.265 0.513 -0.067 -0.407 -0.478 13.97 65.174

Attributes Quality Aroma Flavour Taste Colour of end product Brand name
R R U

1 4.39E-02 2.92E-02 2.33E-02 2.92E-02 2.33E-02 0.21 0.34 0.622 0.98 0.233
R

2 0.162 0.4 -0.632 0.4 -0.432 -1.91E-02 -1.91E-02 -1.91E-02 -1.91E-02 0.695 -1.91E-02 -1.91E-02 -1.91E-02 -1.91E-02 -1.91E-02 8.036 68.387

4 -9.90E-16 0.673 -0.254 -0.673 0.254 -1.59E-17 -2.83E-17 6.67E-17 -2.08E-16 4.55E-16 2.13E-17 -4.43E-17 1.71E-17 6.80E-17 5.69E-17 6.893 82.409

5 -7.24E-14 -0.254 -0.487 0.254 0.873 -8.04E-15 -1.01E-15 8.19E-16 -1.86E-15 2.46E-14 2.56E-15 -3.00E-16 -8.09E-16 2.32E-15 2.88E-15 6.893 89.302

1 0.0162 -0.073 -0.187 -0.282 -0.108 0.717 0.676 0.472 0.679 0.73 0.797 0.692 0.425 0.366 0.295 34.577 34.577

2 0.352 0.306 0.762 0.843 0.652 0.303 -0.186 0.067 -0.349 -0.185 0.0748 0.101 0.0803 0.374 0.392 16.628 51.205

4 0.0187 0.56 -0.050 0.293 -0.539 -0.323 -0.367 -0.338 -0.078 0.306 0.278 0.157 0.0995 0.18 -0.069 8.638 73.813

5 0.674 -0.293 -0.028 -0.175 0.122 0.287 -0.247 -0.387 0.0001 0.182 0.0739 0.336 -0.058 -0.029 -0.319 6.947 80.76

Retailers influence

Influenced by others Reasonable price Timely availability Attractive packing

9.45E-02 2.92E-02 0.173 0.356 0.897 60.35 60.35

Effective advertisement Celebrity endorsement Gifts/promotions


R&U R&U

Friends/neighbour/ U relatives influence Percentage of variation Cumulative percentage

Note : R indicates the attributes which can be deleted in case of rural scenario U indicates the attributes which can be deleted in case of urban scenario R&U indicates the attributes which can be deleted in case of rural and urban scenario

Table 4.17: Principle components for tea Rural 2 -0.411 -0.257 -0.161 -0.102 -0.136 -0.117 0.517 0.431 0.399 0.44 0.673 0.649 0.331 0.759 0.0395 14.628 52.604 Urban 2 0.43 0.00412 0.00412 0.00412 -0.246 -0.166 0.317 0.441 0.514 0.799 0.0181 0.0223 -0.150 0.0316 0.0407 9.980 81.281

Attributes Quality Aroma Flavour Taste Colour of end product Brand name Retailers influence
R&U R&U

1 0.476 0.843 0.806 0.768 0.743 0.664 0.296 0.561 -0.639 -0.657 0.196 0.201 0.429 0.339
R&U

3 0.625 0.238 0.325 0.312 -0.0999 -0.178 0.064 0.326 0.342 0.328 0.357 -0.0391 -0.447 -0.194 -0.222 11.764 64.368

1 -0.15 0.982 0.982 0.982 0.578 0.946 0.499 0.337 -0.824 0.191 0.94 0.943 0.309 0.915 0.243 71.301 71.301

3 -0.643 -0.169 -0.169 -0.169 0.684 0.102 -0.0249 0.0225 0.0507 0.53 -0.0127 -0.00733 0.330 -0.223 -0.207 8.438 89.718

Influenced by others Reasonable price Timely availability Attractive packing

Effective advertisement Celebrity endorsement Gifts/promotions Friends/neighbour/ relatives influence


R&U

0.428 37.977 37.977

Percentage of variation Cumulative percentage


R

Note : indicates the attributes which can be deleted in case of rural scenario U indicates the attributes which can be deleted in case of urban scenario R&U indicates the attributes which can be deleted in case of rural and urban scenario

Table 4.18: Importance of attributes in preference of coffee and tea brands through Index method

Sl No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Quality Aroma Flavour Taste

Attributes Urban 97.66 96.88 95.31 92.19 78.13 72.66 50.78 48.44 57.03 69.53 62.50 61.72 47.66 48.44 46.88 68.39

Coffee Rural 97.54 98.77 98.77 78.13 98.77 26.23 25.41 74.18 25.41 38.93 50.41 50.41 25.82 25.82 50.41 57.67 Total 97.58 98.12 97.58 85.16 91.67 42.20 34.14 65.32 36.29 49.46 54.57 54.30 33.33 33.60 49.19 61.00 Urban 100 98.30 97.44 96.59 78.98 70.45 53.41 52.27 67.90 77.56 69.89 66.76 51.14 61.93 49.15 72.78

Tea Rural 96.51 83.14 84.01 83.14 70.35 60.00 47.97 45.64 77.91 84.30 54.07 47.97 43.31 45.06 39.83 64.21 Total 98.28 90.80 90.80 89.94 74.71 65.32 50.72 48.99 72.84 80.89 62.07 57.47 47.27 53.59 44.54 68.55

Colour of end prod Brand name Retailers influence Influenced by others Reasonable price Timely availability Attractive packing Effective advertisement Celebrity endorsement Gifts/promotions Friends/neighbour/relatives influence Total

100

120

20

40

60

80

Q ua lit y A ro m a Fl av ou r

Co lo ur

Fig.7: Opinion index of attributes for brand preference of coffee

Fig 7: Opinion index of attributes for brand preference of coffee

of T en ast e d pr od uc t Br an Re d ta na ile m rs e In in flu flu en en ce ce d by ot Re he as rs on ab Ti le m pr el ic y e av A ai ttr la bi ac lit tiv y Ef ep fe ac ct ki ad ng Ce ve le rti br se Fr ity m ie en nd en t s/n do rs ei em gh Gi bo fts en ur /pr t /re o la mo tiv ti es ons in flu en ce

Urban Rural

100

120

20

40

60

80

Q ua lit y A ro m a Fl av ou r

Co lo ur

Fig.8: Opinion index of attributes for brand preference of tea

Fig 8: Opinion index of attributes for brand preference of tea

of T en aste d pr od uc t Br an Re d ta na ile m rs e In in flu flu en en ce ce d by Re ot he as rs on ab Ti le m pr el ic y e av A ai ttr la bi ac lit tiv y Ef ep fe ac ct ki ad ng Ce ve le rti br se Fr ity m ie en nd en t s/n do rs ei G em gh bo ifts en /p ur t ro /re m la tiv otio es n in s flu en ce

Urban Rural

Table 4.19: Relative importance and relative utility scores for different parameters of coffee in northern and southern Karnataka

North Parameters Relative importance (%)

South Relative importance (%)

Relative utility

Relative utility

Brands

Bru Kothas Nescafe

-0.128 -0.475 0.603 4.147 8.294 12.441 0.462 0.923 1.019 2.038 1.404 2.808 - 3.05

18.478

0.69 -0.858 0.788

16.635

Price of the powder

High Medium Low

56.902

4.333 8.667 13.00

60.481

Packaging type

Loose Sealed

6.923

-0.125 -0.063

5.927

Promotions available

Yes No

7.878

0.646 1.292

7.559

Form of the powder

Instant Filter

9.820

1.333 2.667 - 1.98

9.397

(Constant)

The relative utility of brands showed that Nescafe was preferred the most in both north (0.60) and south (0.79) among the popular brands. When the price of the coffee powder was considered, lower price was preferred the most with a value of 12.44 in the north and 13 in the southern region of Karnataka. The relative utility attached to sealed packing was higher in comparison with the loosely available type of packaging with values of 0.92 and -0.06 in the northern and southern regions, respectively. Coffee powder without promotions was preferred among the sample respondents in both the regions of the study. Filter form of coffee powder was preferred by the sample respondents with values of 2.81 in the north and 2.67 in the south region of Karnataka.

4.4.7 Relative importance and utility for tea powder


Information pertaining to relative importance and relative utility scores for various parameters of tea in the northern and southern regions of Karnataka is provided in the Table 4.20. In case of tea too, respondents from both the northern as well as the southern region of Karnataka attached greater importance to price of the tea powder. In the north, the relative importance score stood at 51.82 per cent and in the south it was 30.55 per cent. The type of packaging was least among the other parameters with values of 6.71 per cent in the north and 11.15 per cent in the south, respectively. Red Label was the most preferred brand of tea, within the popular tea brands selected by the respondents. The relative utility associated with it was 1.68 in the north and 1.08 in the south. With respect to the price of the coffee powder was considered, lower price prevailed over the rest, with relative utility of 8.07 in the north and 3.38 in the south. Sealed packing, no promotions and dust form of tea obtained higher relative utility among the sample respondents in both the regions of Karnataka.

4.5

Health aspects related to coffee and tea consumption

To know the health related aspects of coffee and tea, five doctors from each district were select. The data from around twenty doctors were analyzed and the results were obtained.

4.5.1 Recommended frequency of coffee and tea consumption suggested by respondent doctors
Most of the doctors were of the opinion that, the minimum age for consumption of either coffee or tea should be 10 years. Few doctors also felt that it was not advisable to consume coffee or tea before the age of 25 years. The frequency at which a person can consume coffee and tea is furnished in the Table 4.21. It is clear from the Table that, 55 per cent of the respondent doctors felt that it is not advisable for children to take coffee and/or tea. However, 45 per cent of the doctors opined that one cup of the beverage is safe for children. For 95 per cent of the selected doctors recommended two cups of coffee and tea per day. For the working class, the recommendation was two cups per day as expressed by 65 per cent doctors, but the remaining 35 per cent of them recommended three cups of the coffee and/or per day. The recommendations made by most of the doctors for the old age group was around two cups per day.

4.5.2 Recommendations for the quantity of coffee and tea consumption


The quantity of coffee and tea that can be consumed by an individual in a day is given in the Table 4.22. There is no much difference in the quantity recommended for coffee and tea across the sexes. It is seen that children can have on an average about 70 ml of coffee or tea in a day. For the teenagers, a range of 100 to 200 ml of the beverage was recommended. The working class had the highest quantity recommendation with a mean of 235 ml in a day. They could have up to 300 ml of the beverage in a day as opinioned by the doctors. In the case of old age, a minimum of 150 ml to a maximum of 200 ml of the coffee and/or tea was recommended.

Table 4.19: Relative importance and relative utility scores for different parameters of coffee in northern and southern Karnataka

North Parameters Relative importance (%)

South Relative importance (%)

Relative utility

Relative utility

Brands

Bru Kothas Nescafe

-0.128 -0.475 0.603 4.147 8.294 12.441 0.462 0.923 1.019 2.038 1.404 2.808 - 3.05

18.478

0.69 -0.858 0.788

16.635

Price of the powder

High Medium Low

56.902

4.333 8.667 13.00

60.481

Packaging type

Loose Sealed

6.923

-0.125 -0.063

5.927

Promotions available

Yes No

7.878

0.646 1.292

7.559

Form of the powder

Instant Filter

9.820

1.333 2.667 - 1.98

9.397

(Constant)

Table 4.20: Relative importance and relative utility scores for different parameters of tea in northern and southern Karnataka

North Parameters Relative importance (%)

South Relative importance (%)

Relative utility

Relative utility

Brands

Taj Mahal TATA tea Red label

-0.333 -1.350 1.683 2.691

21.938

-0.411 -0.669 1.081

16.086

Price of the powder

High

51.815

0.703

30.552

Medium Low Packaging type Loose

5.382 8.073 -0.400 6.714

2.255 3.382 0.317 11.151

Sealed Promotions available Yes

-0.800 0.717 9.145

0.633 1.500 17.433

No Form of the powder Dust Dip (Constant)

1.433 1.117 2.233 1.72 10.389

3.00 -0.750 -1.500 5.03 24.778

Table 4.21: Recommendations for coffee and tea consumption (Frequency) by the selected doctors Male Frequency Particulars (number of cups per day) Nil 1 2 3 Nil (number of cups per day) 1 2 3 Female Frequency

Coffee Children 11 (55%) Teenager 9 (45%) 1 (5%) Working class 19 (95%) 13 (65%) Old age 20 (100%) Tea Children 11 (55%) Teenager 9 (45%) 1 (5%) Working class 19 (95%) 13 (65%) Old age 20 (100%) Note: Figure in parentheses indicate percentage to the total 7 (35%) 1 (5%) 1 (5%) 19 (95%) 13 (65%) 19 (95%) 7 (35%) 7 (35%) 1 (5%) 11 (55%) 9 (45%) 1 (5%) 19 (95%) 13 (65%) 19 (95%) 7 (35 %)

Table 4.22: Recommendation for coffee and tea consumption (Quantity) by the selected doctors (Fig in ml)

Male Particulars Minimum Maximum Mean Minimum

Female Maximum Mean

Coffee Children Teenager Working class Old age 50 100 200 150 75 200 300 200 69.44 152.5 235.0 152.5 50 100 200 100 75 200 300 200 69.44 152.50 235.00 150.00

Tea Children Teenager Working class Old age 50 100 200 100 75 200 300 200 69.44 152.5 235.0 150.0 50 100 200 150 75 200 300 200 69.44 152.50 235.00 152.50

Table 4.23: Benefits and effects of coffee and tea consumption as reported by the selected doctors

Frequency Sl. No. Particulars (nos.)

Percentage (%)

A. 1. 2. 3. 4. 5. B. 1.

Benefits Stimulant Reduces cardio-vascular diseases Hydration Reduces gout (painful joint disorder) Reduces muscle pain Effects Gastritis 11 55.00 8 4 5 2 5 40.00 20.00 25.00 10.00 25.00

Note: More than one benefit was reported by some of the selected doctors.

Most of the doctors (70%) were of the opinion that coffee or tea should be consumed with a time interval of at least eight hours, i.e., a person can enjoy his beverage once in the morning and once in the evening. However, 30 per cent (6 nos.) of the selected doctors opinioned that the beverage could be consumed at a time interval of five hours.

4.5.3 Benefits and effects of coffee and tea consumption


Coffee and tea have various benefits and bad effects to some extent. The list of the benefits of drinking these beverages is being furnished in the Table 4.23. Around 20 per cent of the respondents felt that coffee and tea acts as a stimulant and also reduces the cardiovascular diseases to some moderate extent. Few respondent doctors (25.00%) said that coffee and/or tea helped in hydration and was good in reducing the muscle pain. Around 10 per cent of the doctors expressed that these coffee and/or tea helped in reducing gout (a painful joint disorder). Around 55 per cent of the doctors said that, these drinks enhanced gastritis in a person who is already suffering from this disorder.

5. DISCUSSION
The results discussed in the previous chapter are discussed in this chapter. The discussions are presented under the following headings: 5.1 5.2 5.3 5.4 5.5 General characteristics of the sample respondents. Socio-economic factors influencing consumption of beverages Consumption and expenditure pattern of beverages Brand preference and its quality attributes of coffee and tea Health aspects related to coffee and tea consumption

5.1

General characteristics of the sample respondents

A perusal of general characteristics revealed that half of the respondentss in the rural category were illiterate as compared to the urban. Since most of them fall under the low socio-economic category and also the lack of proper educational facilities in rural areas made it difficult for those living in rural areas to get proper education. More than 75 per cent of the urban groups have a minimum education of SSLC; this is because most of the respondents belonged to the working group, among that, a majority was occupied by the graduates (29.20%). It can be attributed to the fact that, most of the selected respondents were either government employees or executives of private firms. The rural areas had more households living jointly (20.80%) when compared to the urban. This is expected, considering the fact that traditionally, rural people have been living in the ancestral homes with many members of the family tree and sharing the ancestral property. But many families in the urban as well as the rural were nuclear; this can be associated to the fact that the changing life style of the people in Karnataka does not favour joint family types. Therefore, the number of nuclear family types is on a higher side. The percentage of respondent belongs to Hindu religion was more than eighty; it goes on par with the population of Karnataka. Muslim, Christians and Jains belong to minor group in Karnataka, so also in the research study area. Agriculture was the major occupation for majority of the respondents belonging to the rural areas. This is because; the selection of the respondents is from plantation area (Kodagu) and also in districts like Dharwad and Belguam, the major occupation of the people is agriculture. And nearly thirty per cent of the respondents are either employed either in a private or government sector in the urban areas. In these areas, due to the high cost of living, it is obvious that those living here have to be employed somewhere to make a living.

5.1.2 Classification of sample respondents based on age and income


More than half of the respondents both in urban and rural areas belonged to middle age group, as the classification was done based on mean +/- 0.425*SD. Age is an important variable with which social status is associated. The middle age respondents are more efficient and responsible from their younger counter parts and are more energetic than the older respondents.

The low income group had majority of the rural respondents. This is because; these respondents hailed from the villages, where agriculture is still the main occupation of the majority of the respondents and also their land holdings were small and hence their income was low. In the urban sector, majority of the respondents belonged to the higher income group. This is due to the fact that the urban sample respondents were either government servants or executives of private firms or are indulged in their own business. And with the corporate sector playing a major role in the urban areas and with their perky income scales, it comes as no shock that most of the respondents belonged to the higher income group in the urban areas.

5.1.3 Decision making in the family regarding food purchase


From the results we find that in more than forty per cent of the households all the family members were involved in the decision making regarding the food consumption. This may be to the fact that, people are increasingly getting aware of their individual needs and are therefore involved in taking the family consumption decisions together. The family heads and the wives of the respondents were involved in taking the decisions regarding the family food consumption in the remaining sixty per cent of the households. This can be because, they may feel that they understand the family needs better and take the family decisions to suit all the members of the family. In few households the wives of the respondents took the family decisions, may be because they were home makers and they understood the needs of all the family members better than anyone else in the family.

5.2

Socio-economic factors influencing consumption of coffee and tea

To identify the factors influencing the demand for the beverage, a multiple linear regression method was used. This functional form was selected as it gave a better fit to the data.

5.2.1 Factors influencing the consumption of coffee and tea


Consumption of any food items is influenced by a host of socio-economic factors. However, not all the factors significantly influence consumption. Table 4.4 reveals that education was the only factor that was significant with respect to the demand for coffee by the urban respondents. The co-efficient of multiple determination (R2) was 0.59, which says that, 59.20 per cent of the total variation in the model is explained by the selected variables, i.e., age, education, family size, total family income and price per unit of coffee. It was observed that family size and total family income had a positive influence on the demand for coffee in the urban areas. This means that, every one per cent increase in the total family income increased the demand for coffee to the extent of 0.00015 per cent, and also from the Table 4.4 it is observed that every one per cent increase in family size increased the demand for coffee by 0.04 per cent in the urban areas. This is in line with the study conducted by Inamke et al (1995) who found that family income was the factor that most significantly influenced milk consumption for both, urban and rural consumers. In the rural areas, family size and the price per unit of coffee were highly significant. Here the R2 was 0.67, implying that 67.10 per cent of the variation in the model was explained by all the variables which were selected. The family size had a positive influence on the demand of coffee in the rural areas, while the price per unit of coffee had a negative influence on the coffee demanded in the rural areas, i.e., it implies that every one per cent increase in the price of coffee in the rural areas decreased the quantity of coffee demanded by 0.0051 per cent. This may be so, because most of the rural households run on a tight budget. Amitha (1998) in his study on consumption of dairy products in Bangalore city, found that price of table butter had a negative influence on consumption.

In the case of tea, total family income turned out to be highly significant in the urban areas. This is in line with the findings of Hugar (1996), who reported that income was one of the main factors that influenced the consumption expenditure on vegetables in Dharwad district. Total family income, education and family size had a positive influence on the demand for tea in the urban areas, while price per unit of tea had a negative influence. In the rural areas, it was the family size which was highly significant. All the other factors were found to be non-significant at both five an one per cent level of significance.

5.3

Consumption and expenditure pattern of coffee and tea

The consumption and expenditure on coffee and tea by the urban and rural respondents are discussed under the following sub headings.

5.3.1 Monthly expenditure pattern of urban and rural households


The expenditure pattern of the sample households in the urban and rural areas are given in Table 4.5. The results indicated that the urban households spent a little higher on food when compared to the rural households, this is so due to the fact that the prices in urban areas are higher as compared to the rural parts and also because people in the urban areas go for processed food which usually comes with a higher cost. Looking into the percentage of income spent on total food items, it was observed that it was higher in case of rural areas, than in the urban. This goes in terms with the economic principle, which defines that, as the income increases, the share per cent of money spent on food items decreases and increases on luxuries items. When considering the beverage alone, there was no significant difference in the quantity of beverage purchased either by the urban or the rural households. But when comparing the money spent on the beverages, it was quite evident that the urban households spent more than their rural counterparts, this is mainly due to the fact that the urban people purchased branded beverages, while those in the rural areas got their beverage either directly from their plantations (coffee) or purchased loose dusts (tea), which normally comes at a lower price. Therefore, there is a significant difference in the expenditure on the beverages. Milk being an essential commodity was consumed by all the selected respondents. Here too the urban respondents consumed more quantity of milk and parted with more share of their income as compared to their rural counterparts. As in rural areas, usually milk producing mammals are domesticated, it is usual that it costs less, whereas in urban areas, milk is delivered to individual houses by the milk federation companies, hence by involving all the costs, i.e., packaging, transportation, etc., milk becomes dearer in the urban areas than its rural counterparts.

5.3.2 Association between nativity and region in coffee and tea consumption
In the north zone, only 7 (11.70%) out of the total 60 sample households in the urban areas consumed coffee, while there were no takers for coffee in the rural regions. In the south, the situation was very different, with 81.70 per cent in the urban and around 38 (63.80%) in the rural areas preferring coffee. Whereas, 59 (98.30%) in the urban and cent per cent in the rural areas went for tea, in the north zone. In south, the numbers stood at 29 (48.30%) and 26 (43.30%) for urban and rural households for tea consumption. Basically, there could be two reasons why people prefer drinking coffee in the south. One being, its proximity to the coffee growing areas and also to the fact that most the respondents selected from the urban areas belonged to the middle age group and they think it as fashionable to drink coffee in coffee bars and lounges. Since, Kodagu was one of the sample areas, and as it is one of the coffee growing regions in Karnataka; we find that more than 60 per cent of the rural respondents consuming coffee, as they prefer getting their beverage directly from their own plantations. The chi-square value was also found to be highly significant in the north zone among the urban and rural consumers, indicating that there is a great difference in coffee consumption in the nativity of this zone. Tea was the beverage mostly consumed in the northern zone of Karnataka because, most of the respondents there belonged to the low income category and since tea is cheaper when

compared to coffee; the selected respondents in the north mostly went for it. Also, coffee requires more milk for preparation in comparison with tea; this could be another reason for the people in the north opting for tea. Milk was consumed in all the sample households in both the urban and rural regions of both the zones. This could be because, milk is used in the preparation of coffee and tea; and hence was required by all the selected households in both the zones. Horlicks/Boost/Bournvita was consumed more in the urban households of the south than in the north. The reason for this could be that, Boost/Bournvita is added to coffee to give it a more chocolaty taste, but it does not go well with tea. Also, since these are more popular among children, it can also be predicted that the kids in the urban areas of the south are more demanding than in the north. From the Table it is also observed that in the rural regions of the north, there were very few takers for Horlicks/Boost/Bournvita, may be because, the respondents there are basically farmers with small land holdings and low income, and thus have a tight budget. Hence, they may not prefer to spend around Rs. 300 per month on such food items. Also, the chi-square value was found to be highly significant in the urban and rural areas of the north zone, indicating that there is difference in the consumption of Horlicks/Boost/Bournvita in the urban and rural areas of the north zone. Ragi malt had no takers in the south; the reason could be that the people down south are short of their time. As the preparation of ragi malt requires more time when compared to any other beverage, and also with the advent of instant beverages and foods, consumers usually may not prefer spending more time on just preparing a beverage which does not taste better than either coffee or tea.

5.3.3 Region-wise quantity purchased and expenditure per month among the sample respondents
From the Table 4.7 it is clear that coffee was purchased more in the south than in the north. The reason here could be associated with the fact that, since Kodagu was selected as a sample district and as it is a coffee growing area, the people there tend to consume more. Hence, the quantity of coffee purchased in the south is significantly higher in the south than in the north. The total expenditure too was significantly higher in the south than the north. This may be due to, Bangalore being a metro and with the mushrooming of supermarkets; there are more number of high end food products available for these consumers. And also, since the quantity of coffee purchased is more, the expenditure incurred will also be on the higher side. There was no difference in the quantity of tea purchased in both the zones, but there was a significant difference with respect to the expenditure incurred. This may be because, people in the northern district of Karnataka usually purchase loose tea dust than the branded ones. Hence, their expenditure is significantly lower than those of their urban counterparts. Though, milk was consumed in all the sample households, its quantity and expenditure differed significantly from each other. There is difference in quantity because most of the households in the north get their home requirement of milk from their domesticated mammals, but whereas in south and that too in a metro place like Bangalore, the consumers depend on the milk federations, which supply milk to the doorsteps of the consumers and in standard quantities. And also, in places like Kodagu district, the number of milch animals is higher when compared to the places in the north. The number of households consuming Horlicks/Boost/Bournvita is higher in south in comparison to the north. The quantity and the expenditure incurred on these too are slightly on a higher side in south compared to its northern counterparts. This could be due to the various promotions offered by these companies in the supermarkets in a metro city like Bangalore to attract more number of children to buy their products.

5.3.4 Differentiation of beverage consumers based on region and nativity


Tea was the highest consumed beverage among all the beverages, when all the family members in the sample households were considered, in both the regions of Karnataka, with 57.30 and 51.50 per cent of the people consuming tea in the northern and southern regions respectively. In the north zone, as reported earlier, the people there consume more tea than the south, due to various reasons. Those reasons vary from the cost the tea, to its availability and food consumption pattern. In the south too, more than fifty per cent of the respondents consume tea. Totally, there were around 506 (54.30%) people of the total 932, who consumed tea in Karnataka. Of the total respondents obtained from the sample households, 22.50 per cent of them in the north had coffee Going by the nativity of the respondents, 226 (50.30%) and 280 (58.00%) of them drank tea. More number of people were found consuming tea, because of the various reasons cited earlier. Tea is usually cheaper in price when compared to coffee and hence this could me one of the main reasons behind many people going in for tea. Coffee, on the other hand was consumed by 91 (20.30%) respondents in the urban and 102 (21.10%) respondents in the rural areas. There were more number of people in the rural areas consuming coffee, this can be attributed to the fact that the Kodagu region where coffee is one of the main agricultural crop, may be the people there went for consuming only coffee as it could be directly obtained from their own plantations. Horlicks\Boost\Bournvita was consumed more in the urban areas than the rural. This could be mainly due to their availability, as it is commonly available in any stores in the urban areas, whereas, it is hard to find Horlicks\Boost\Bournvita in all the stores in the rural areas. Also, it can be said that, in the urban areas, children accompany their parents for shopping groceries and therefore when they find these on the showcase with attractive promotional items they insist on getting them. Plain milk is seen to be consumed more in the rural areas, this mat be because children in the urban prefer mixing their milk with Horlicks\Boost\Bournvita rather than drinking the plain milk, whereas in the rural areas, due to tight expenditure and availability constraint, they might prefer with drinking only plain milk. More number of respondents in the urban areas drank both coffee and tea. This may be due the fact that, in urban areas, almost all the people go to work to make a living and in their work places they may be served with any one of the beverage, but they might prefer drinking the other at homes. And also in urban areas, when people go out in groups, they might order a common beverage. Hence, there are more number of people consuming coffee and tea in urban areas. The chi-square value also stood highly significant at 66.23, indicating that there was a significant difference in the consumption of most of the mentioned beverages in the urban and rural areas.

5.3.5 Age wise distribution of beverage consumers in the urban and rural region of the sample study area
From the Table 4.9, which gives a clear differentiation of the beverage consumed by respondents belonging to the different age groups, we find that the children in the rural areas consumed more of tea than those in the urban, but Horlicks\Boost\Bournvita was consumed more in the urban than in the rural areas. Also the consumption of plain milk was higher among the rural children as compared to the urban. The reason behind it could be that, children in the urban prefer consuming Horlicks\Boost\Bournvita rather than plain milk. Also the availability and higher income of the urban households can be attributed to this. There was a slight increase in the number of respondents from the sample households who drank coffee and tea in the urban regions. This can be mainly associated to their work places, which might serve any one among the two common beverages. The chi-square values were highly significant in both the urban and rural areas, indicating that there was definitely a great difference in the consumption of beverages between the adults and the children, in both the urban and rural areas.

5.3.6 Association between age group and consumption pattern


The respondents from the 240 sample households were categorized into three age groups, namely, younger, middle and older age group. 5.3.6.1 Frequency of coffee and tea consumption The number of times the respondents consumed their coffee and/or tea is discussed below for different age groups. 5.3.6.1.1 Frequency of coffee consumption The respondents from the 240 sample households were categorized into three age groups, namely, younger, middle and older age group. The younger age group consisted of respondents below 35 years of age. Of the total number of respondents, 42 in the urban and 32 respondents in the rural belonging to the younger age group consumed coffee. Most of them had their coffee only twice in a day, this could be because, most of the respondents belonging to this category were students and hence were not used to drinking coffee more than two times in a day. There were around 26.20 per cent from the urban and 28.10 per cent from the rural who consumed more three cups of coffee in a day. These could be the newly employed executives in working firms who are adjusting themselves to the work culture and might drink coffee in between work hours to get relief from their work tension. In the middle age category, most of them drank their beverage thrice in a day (about 50.00 %) in the urban area, while in the rural, 58.70 per cent of them had it only twice in a day. People in the urban areas drank thrice, when compared with those in the rural who drank only twice per day, this could be because in the urban most of the people belonging to the middle age category are office goers and they might be served with either coffee or tea in their office premises or they might hang out with their colleagues during their free time over a cup of coffee. In the older age group, more number of people from the sample households drank their coffee twice in a day. The reason here could be that, by the time the people enter the old age, they are bound to develop many ailments like diabetics, BP, etc., and hence they are advised by the doctors to restrict their coffee consumption to minimal, in order to keep a check on their ailments. 5.3.6.1.2 Frequency of tea consumption The percentage of tea consumers who drank their tea twice in a day were 48.70 per cent in the urban and 61.40 per cent in the rural. Most of the respondents belonging to younger age group consumed tea twice in a day. The figures were 62.80 per cent for the urban and 71.10 per cent for the rural. Among the middle age respondents, 46.40 per cent in the urban areas had tea three times in a day, while in the rural; about fifty per cent of them consumed tea two times in a day. Among the old age category too, most of the respondents in the urban (51.20%) as well as the rural (48.70%) consumed tea twice in a day. The reasons discussed above holds well in this scenario also. 5.3.6.1.3 Frequency of coffee and tea consumption There was comparatively low number of respondents in this category, in comparison with the other two. The reason could be that people usually stick to one form of beverage and those respondents drinking both coffee and tea are basically employed and since their employees may provide them with many beverage options, they tend to consume all of those. And since they get used to drinking both the beverages in their work places, they might follow the same habits in their house also. Also, in few households, one person may prefer drinking coffee and the other tea, so they might end up consuming both as time proceeds.

5.3.6.2 Place of coffee and tea consumption It was the homes of individuals, where the beverage was mostly consumed across all the age groups and in both urban and rural areas. This could be due to the fact that, beverages are one of the food items which is consumed early in the morning; and in the evening to relax one self after a busy day out. So, this could be the driving factor behind many people having their beverage at home. 5.3.6.2.1 Place of coffee consumption Among all age groups, the maximum number of respondents belonged to the first option, i.e., they drank their coffee only at their homes. 5.3.6.2.2 Place of tea consumption In case of tea also, most preferred drinking it in their homes. The reasons quoted above can be applied here also. 5.3.6.2.3 Place of coffee and tea consumption Here too, the place of consumption which was most preferred was their homes. 5.3.6.3 Quantity of coffee and tea consumed each time The quantity where the respondents consumed their coffee and/or tea is discussed below for the three different age groups. 5.3.6.3.1 Quantity of coffee consumed each time Majority of the respondents across all age groups consumed around 100 ml of coffee during each serving. When comparing with the respondents consuming tea, coffee drinkers consumed more quantity for each serving. The reason could probably be because, most of the coffee drinkers in the sample study were from Kodagu district where the main crop grown is coffee and hence these respondents tend to consume more amount of coffee. 5.3.6.3.2 Quantity of tea consumed each time There were 226 respondents from the urban and 280 respondents from the rural who consumed tea. More then ninety per cent in the urban and about 88.20 per cent in the rural areas had only 50 ml of tea during each serving. The reason could be that, tea is usually considered as stimulants rather than a source for nutrition. Hence, people go in for having smaller quantities of the beverage. 5.3.6.3.3 Quantity of coffee and tea consumed each time Among the respondents who consumed both coffee as well as tea, majority of them had 50 ml of the beverage at each serving. The reason could be because, those belonging to this category are basically employees and therefore, since in work places or for the matter even in few hotels, usually the beverages are served to the tune of 50 ml for each serving. 5.3.6.4 Quantity of coffee and tea consumed per day The quantity of coffee and tea consumption is directly associated to the frequency and the quantity of its consumption during each serving. Here too the values are approximation of the total quantity and not the exact values. 5.3.6.4.1 Total quantity of coffee consumed per day The younger age group consumed around 100 to 250 ml of coffee in a day. This is due to the fact that their frequency of consumption was low among this age group. The middle age group respondents consumed coffee to the tune of 250 to 500 ml in a day, mainly because their frequency of consumption was more as they consumed at both their homes and office. Among the older age group, more number of respondents in the urban areas consumed 250 to 500 ml of coffee in a day, while in the rural areas majority of the respondents consumed 100 to 250 ml of coffee in a day.

5.3.6.4.2 Total quantity of tea consumed per day In the urban areas, about 49.10 per cent of the respondents consumed tea to the range of about 100 ml in a day and in the rural their percentage stood at 56.80. Another 46.00 per cent of the urban respondents drank tea in the range of 100 to 250 ml in a day; while in the rural area it was 40.70 per cent who consumed tea to the tune of 100 to 250 ml in a day. This was mainly because the quantity of tea consumed during each serving was low. 5.3.6.4.3 Total quantity of coffee and tea consumed per day Among those who consumed both coffee as well as tea, 37.70 per cent in the urban and 45.50 per cent in the rural drank up to 100 ml of it in a day. Another 37.70 per cent in the urban and 36.40 per cent in the rural drank their beverage to the tune of 100 to 250 ml in a day. Only 5.70 per cent of the urban respondents drank their beverage to the tune of 500 to 1000 ml in a day, while in the rural areas there were no respondents who consumed this high quantity of either coffee or tea in a day. This is due to the fact that the frequency of beverage consumption and the quantity of its consumption each time was low.

5.4

Brand preference and quality attributes of coffee and tea

Various brands of coffee and tea were preferred by the urban and the rural respondents. The list and the frequency of the respondents preferring those brands are discussed in the topics below.

5.4.1 Brand preference of coffee and tea


Sixty five per cent of the respondents who drink coffee give first preference for own plantation because all of them have they own coffee plantations. The taste and aroma of fresh coffee beans is so appealing that they tend to give highest preference for that. Rest of the 35 per cent who prefer drinking coffee, most of them prefer instant coffee (Bru or Nescafe), because they belong to working class and time is a constraint for them; and it could be also due to the fact that they might like the taste of the instant coffee. Among the tea drinkers, most preferred having Red label, followed by tea dust, TATA tea and Taj Mahal. Red label could the first choice of preference among majority of the tea drinkers, because, it has established a very good market for itself, wide publicity and taste. Tea dust was mainly preferred by the rural people because of the good taste with low price. TATA tea and Taj Mahal was comparatively better as compared to other brands like Three roses, Brook Bond, Star dust, etc.

5.4.2 Brand loyalty among the selected respondents towards respective coffee and tea brands
There is no much difference between the urban and the rural with respect to the brand loyalty to the beverage. This is because people tend to use the same brand once they get accustomed to it. Another reason for why rural respondents are loyal to their beverage brand could be that, in Kodagu district most of the respondents got their beverage directly from their plantations, which was considered as loyalty to their home production. Similar results were observed even with respect to north and south zones. This is because people in the south drink coffee and they are loyal to their brand and those in the north drink tea and they too are loyal to their respective tea brands.

5.4.3 Principle component analysis for coffee


The principle component analysis (PCA) was administered to identify the important attributes for brand preference of coffee in urban districts. Quality, aroma, flavour, taste, brand name, reasonable price, timely availability, attractive packing, effective advertisement, celebrity endorsement, gifts and promotions had higher principle component scoring. The respondents gave more preference for quality, taste, reasonable price and timely availability; which is some of the common traits the consumers expect from any beverage brand. However, aroma and flavour were also an added attribute, as they add taste to the beverage. These findings are in line with the results reported by Singh et al. (1995) that milk quality, convenient availability, supply in desired quantity, flavour, colour, freshness and mode of payment showed higher levels of consumer satisfaction were the factors influencing the consumers preference for milk. Because of the exposure of the mass media, the educated people gave importance for attractive packing and effective advertisement. Gifts and promotions are an added attraction for effective sale of the product. Urban people do not get influence by retailers as well as others and they do not bother about the colour of the end product. Even they are least influenced by friends/ neighbours/relatives because, they go by they own taste. Hence, colour of the end product, retailers influence and influenced by others and friends/neighbours/relatives influence are the attributes which got least scoring and could be deleted. In the case of coffee consumption in rural areas, brand name, retailers influence, reasonable price, attractive packaging, celerity endorsement and gifts/promotion are the six attributes which could be deleted for the further study. In the rural areas, the consumers preferred getting their beverage directly from their own plantations, and hence attributes like brand name, retailers influence, attractive packaging, celerity endorsement and gifts/promotion had no influence on the selected consumers.

5.4.4 Principle component analysis for tea


The urban people who consumed tea went by the quality, aroma, flavour and taste rather than the influence by the mass media and celebrity endorsements. This could be because, people in the urban areas are well educated from those in the rural and are well aware of the tastes and quality parameters and are not merrily influenced by mass media and others. The people in the rural areas who consumed tea went for lose tea dust rather than the branded ones. This could be one of the main reason for low factor loading in the case of effective advertisements, celebrity endorsements and gifts/promotions.

5.4.5 Opinion indices of attributes for brand preference of coffee and tea
The Table 4.18 indicates the opinion of respondents for different attributes for coffee in urban area. From the Table 4.18 it is clear that, quality, aroma, flavour and taste was observed to be strongly agreed by the respondents. The mean opinion index was found out to be 97.66, 96.88, 95.31 and 92.19 respectively for these attributes. Colour of the end product, brand name, timely availability, attractive packing and effective advertisement was observed to be agreeable for the respondent in urban areas. Reasonable price and retailer influence was found to be next preferred attribute. However, respondents disagreed for these four attributes, namely, influenced by others, celebrity endorsement, gifts/ promotions and friends/neighbour/relatives influence. The people in the urban area gave maximum preference for quality, aroma, flavour and taste of the coffee beverage as compared to other attributes. This goes in line with the research conducted by Haripuram, who found that the consumers gave their first preference to taste of biscuits. So, taste and quality are the two attributes which are very essential in the case of food products.

Timely availability, retailers influence, reasonable price, attractive packing, effective advertisement, celebrity endorsement, gifts/ promotions and friends/ neighbours/relatives influence are the least preferred attributes in the rural areas. This might be because most of the rural respondents who hailed from Kodagu have their own coffee plantation and they get their beverages directly from their own plantations. The people in the urban area gave maximum preference for quality, aroma, flavour and taste of the tea as compared to other attributes. Cent per cent of them in the urban area strongly believe that quality of tea is the most preferred attribute; this may be because most of the urban people are educated and they go by the quality of the food products before they consume. Attractive packing, effective ad and gifts/promotions are found to be having higher index in case of urban people. Rural respondents prefer quality, aroma and taste but not to the extent of their urban counterparts; where they give higher preference for reasonable price as compared to the urban respondents because majority of the rural respondents come under low income group. Timely availability was found to have a higher index in case of rural respondents; this might be because rural people usually travel once in a week or so to cities/towns to get their essential food items.

5.4.6 Relative importance and utility of Coffee powder


Table 4.19 provides figures pertaining to relative importance and relative utility scores for various parameters of coffee in the northern and southern regions of Karnataka. Price of the coffee powder received the highest relative importance in both the regions of Karnataka. This is in line with the research conducted by Sudhir (2005), who reported that the rural respondents attached highest importance to price, while purchasing mango for Table purpose. Since, most of the sample respondents were from the middle class families, where price plays a very important role in purchase of any commodity, therefore, price has received the highest relative importance in the conjoint analysis. Nescafe had the highest relative utility value within the popular brands among the sample respondents. This could be because of its international presence and effective advertisement. Sealed packing and powder without promotions received higher relative utility values in its category. There are high chances of adulteration when the powder comes in loose packets, therefore sealed packing obtained higher relative utility, and there is a common perception among the middle class people that products with promotions are of usually low quality, hence powder without promotions obtained higher relative utility values.

5.4.7 Relative importance and relative utility of tea powder


Table 4.20 provides figures pertaining to relative importance and relative utility scores for various parameters of tea in the northern and southern regions of Karnataka. The relative importance and relative utility values were almost the same in the case of tea also. Hence, the above explanation holds good in this scenario also.

5.5

Health related aspects of coffee and tea

Consumption of a regular cup of coffee and tea is not injuries to health, advocates many doctors. People drink coffee and tea not only for its aroma and taste, but also to have a pleasant experience.

5.5.1 Recommended frequency of coffee and tea consumption suggested by respondent doctors
The doctors felt that 16 years of age was idea for recommending coffee and tea consumption. This may be due to the fact that the caffeine in these beverages are mild diuretic and also because these beverages gives a boost during the day and by consumption of these, it is known to take a little longer time to fall asleep. The respondent doctors have recommended a maximum of three cups of the beverage per day. This could be in light of the fact that, the caffeine preset in these beverages, which is a naturally occurring substance, may cause some side effects to the human body.

5.5.2 Recommendations for the quantity of coffee and tea consumption


There is no much difference in the quantity recommended for coffee and tea across the sex. From the Table 4.22, it is seen that, children can have on an average about 70 ml of coffee or tea in a day. For the teenagers, a range of 100 to 200 ml of the beverage was recommended. The working class had the highest quantity recommendation with a mean of 235 ml in a day. Normally, low quantity of the beverage is recommended because it usually does not have any nutritional significance. Most of the doctors were of the opinion that coffee or tea should be consumed with a time interval of at least eight hours, i.e., a person can enjoy his beverage once in the morning and once in the evening. This is because of the composition of coffee and tea, i.e., it contains minerals, chlorogenic acid, proteins, amino acids, alkaloids and related compounds.

5.5.3 Benefits and effects of coffee and tea consumption


Coffee and tea have various benefits and effects to some extent. The list of the benefits of drinking these beverages is being furnished in the Table 4.23. Around 20 per cent of the respondents felt that coffee and tea acts as a stimulant and also reduces the cardiovascular diseases to some moderate extent. This is in line with the research conducted by Professor Peter Martin, Director of the Institute for Coffee Studies (ICS), who found that, consumption of coffee, as a major source of dietary antioxidants, may inhibit inflammation and thereby reduce the risk of cardiovascular disease and other inflammatory diseases.

6. SUMMARY AND POLICY IMPLICATIONS


Coffee and tea are drunk in most countries, but typically one predominates. Coffee is the preferred drink in Europe and America, and tea elsewhere. Until the early eighteenth century, coffee production and consumption was confined to the Islamic World and tea production to East Asia. European traders altered this pattern dramatically. The present pattern of coffee consumption is influenced by income per capita and that of tea is not. Religious influence played some part in the early development of both tea and coffee but have little relevance at the present. In the past, coffee was regarded as an "old fashioned" beverage for older people, with just two flavours: regular and decaf. Coffee, of late has become relevant and contemporary. Coffee houses or bars have sprung up across the country, making coffee an important part of social gathering places. In many communities, coffee bars have become innovative: some provide personal computers so that customers can surf the Net, while others provide match-making services. There is a wide variety of coffee offerings, from size, flavour, preparation and toppings and plenty of gourmet and specialty shops to provide them. For the last few years, new product trends have been driven specifically by consumer demand for more complex, upscale coffee, both in and outside of their homes. The increased sophistication of the coffee drinkers palate means that coffee as a whole is moving away from the Cuppa-Joe image and towards a richer, more complex drinking experience. So, as the trend towards single cup preparation at home is building more and more momentum, packaging innovators are looking at how-to best present pods to these consumers on retail shelves. Annual tea consumption varies from country to country, with the highest consumption of 2.30 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 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 m kgs during 1991, and during 2005, it was estimated to be consumed to the tune of 757 m 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 objectives of the study are:


i. ii. iii. iv. To study the consumption pattern of coffee and tea in Karnataka. To examine the socio-economic factors influencing the consumption of coffee and tea in Karnataka. To analyze the consumer preferences for different brands of coffee and tea and their quality traits. To study the health related issues associated to consuming coffee and tea.

Methodology
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 and Belguam districts were selected from the north, to study the difference in Karnataka, with respect to coffee and tea consumption. In the next stage, two taluks from each district were selected. From these selected taluks, thirty sample households were selected randomly from the urban areas; and from the rural areas, two villages were selected, from each of which fifteen sample households were selected at random. From Bangalore district, Nelmangalla and Kengari were selected as their rural counterpart. Murnad and Kalur 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 and 932 respondents from where information regarding their consumption behaviour towards beverages was studied using a well structured and pre-tested schedule. To study the health aspects associated with the consumption of coffee and tea, five doctors was interviewed at the each of the four districts selected for the study. A well structured schedule was formulated and used to interview the doctors to obtain the required information.

Findings of the study


1. In the urban districts, majority of the respondents were graduates, while in the rural, more than fifty per cent of the respondents were illiterates. Most of the sample respondents were living in nuclear families in both urban and rural areas and also most of them followed Hinduism. Majority of the respondents in the urban areas were government employees, while in the rural, agriculture was their main occupation. 2. 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. Fifty five per cent of the urban respondents belonged to the high income group and had only 17.50 per cent belonging to the low income category, but a large portion of the rural respondents belonged to the low income group. 3. In about 41.70 per cent of the sample households in the urban areas, all the members of the family were involved in taking the food consumption decisions, while the figure stood at 45.80 per cent in the case of rural regions. The wives of the respondents were the major decision takers regarding the purchase food items in 24.20 and 30.80 per cent of the sample households. 4. Only education of the respondents turned out to be statistically significant at one per cent level of significance with respect to demand of coffee in urban areas. It could be observed that family size and income had a positive influence on coffee demanded, while the price per unit of coffee negatively influenced the demand for coffee. In the rural areas, the scenario was quite different. Family size and the price per unit of coffee were highly significant (at one per cent level of significance), while the rest of the factors like age, education and total family income were not significant with respect to demand of coffee in urban areas. In case of demand of tea, the total family income turned out to be highly significant in urban areas, while in the rural areas it was family size which was highly significant. 5. The urban households spends significantly higher (Rs.2620.93) compared to the rural household (Rs.2129.88) in case of total food items. The average total food expenditure of all the sample households stood at Rs.2375.40. The urban households purchased more amount of coffee and/or tea powder in comparison with their rural counterparts. The expenditure on coffee and/or tea powder was significantly high in case of the urban households.

6. Majority of the respondents in the urban and rural areas of the north consumed tea, while in the south 48.30 per cent of the respondents in the urban areas and 43.30 per cent in the rural preferred tea. For coffee, there were no takers in the rural regions of the north and only 11.70 per cent of the urban respondents consumed coffee. Down south, the figures were more pleasing at 81.70 per cent in the urban and 63.80 per cent in the rural consuming coffee. 7. There was more number of households in the north who consumed tea, than in the south. The mean quantity of tea powder purchased in the north as well as in the south was only 0.76 kilograms, whereas the expenditure incurred in the north was much lower than in the south at Rs. 128.36 as against Rs. 86.84. Coffee powder was purchased by 94 households of the 240 households selected for the study. In the south alone, 87 households out of 120 households, consumed coffee at an average of 1.09 kilograms per month spending on an average Rs. 190.70 on its purchase. In the north zone, only seven households consumed coffee, buying an average of 0.35 kilograms with a mean monthly expenditure of Rs. 70.43. 8. Tea was the highest consumed beverage among all the beverages, when all the family members in the sample households were considered; in both the regions of Karnataka, with 57.30 and 51.50 per cent of the people consuming tea in the northern and southern regions, respectively. 9. Going by the nativity of the respondents, 226 (50.30%) and 280 (58.00%) of them drank tea. Coffee was consumed by 91 (20.30%) respondents in the urban and 102 (21.10%) respondents in the rural areas. In the urban areas there were around 53 (11.80%) respondents who drank both coffee and tea, while in the rural areas only 11 (2.30%) respondents had both coffee as well as tea. 10. More number of children in the urban as well as in the rural drank tea. In the urban areas, 23.90 per cent of the children drank Horlicks/Boost/Bournvita and 12 per cent of them drank coffee. Horlicks/Boost/Bournvita and coffee was consumed by only 14 (9.60%) and 6 (4.10%) children in the rural parts of the study area, respectively. The adult scenario in the urban and rural areas was not quite different. Tea being the hot favourite was consumed by 50.30 and 62.90 per cent of the sample respondents in the study area. Coffee was consumed by 77 (23.20%) respondents in the urban, and around 96 (28.50%) respondents in the rural areas. 11. In the younger age group, majority of them drank their coffee and/or tea twice in a day in both the urban and rural areas. In the middle age group category, most of the respondents drank their coffee and/or tea three times in a day in the urban regions, while in the rural it was two cups in a day. Among the old age group also, most of them drank coffee or tea two times in a day. 12. It was their homes, wherein most of the respondents drank their coffee and/or tea, across all age groups and nativity. 13. There were around 91 respondents from the urban and 102 respondents from the rural areas who consumed coffee. Majority of the coffee drinking respondents on an average consumed 100 ml of it during each serving. The number of tea consumers was 226 from the urban and 280 from the rural areas. Unlike coffee, majority of these respondents had only 50 ml of tea at each serving. 14. Most of the respondents preferred to have coffee from their own plantation, i.e., these were the people basically from Kodagu district, wherein almost all the respondents were planters. Going by the commercial brands of coffee, Bru enjoyed the first place with 11.70 per cent of the responding opting it as their first preference and around 1.06 per cent of the respondents choose Bru as their second preference. Nescafe too was not far behind, giving close competition to its counterpart, it was the brand of first preference for about 10.64 per cent of the respondents and about 1.06 per cent of the respondents went for Nescafe as their brand of second preference.

15. Tea which was consumed by 72.50 per cent of the sample households had more number of commercially available brands than coffee. Around 36.21, 2.30 and 0.57 per cent of the sample respondents preferred Red Label as the brand of first, second and third preference, making it the most preferred brand among the sample respondents. About 25.29 per cent of them preferred locally available tea dust making it the second most preferred brand of tea among the respondents. 16. About 88.80 per cent of the sample households were loyal to their beverage brands and only 11.30 per cent preferred experimenting with the brands in the market. 17. The results of the Principle Component Analysis showed that celebrity endorsement, influence by retailers and others had little influence on the purchase of the coffee and tea by the respondents. 18. Quality, aroma, taste and flavour of coffee and tea obtained high index values indicating that, they were the most important attributes preferred in both, the urban and rural regions of Karnataka. 19. The results of conjoint analysis showed that price of the coffee and tea powder obtained the highest relative importance among the other factors considered, in both the northern and southern regions of Karnataka. 20. Most of doctors interviewed for the study suggested that coffee and tea is recommended only after the age of 16 years. Two to three cups of coffee and tea were recommended by the respondent doctors and there must be a time interval of 10 hours before sipping in the next cup.

Policy implications
i. ii. There is a vast scope for coffee promotion in the northern districts of Karnataka. The Coffee Board of India must play a strong role here. The manufacturers of coffee and tea brand must give more importance to the quality, aroma, flavour and tea of the beverage, since these four attributes obtained greater factor loadings in both the rural and urban areas. The price of the coffee and tea powder obtained highest relative importance in both northern and southern regions of Karnataka. Hence the manufacturers of different coffee and tea brands should keep its prices as competitive as possible. The family heads and the better half of the respondents were the major decision takers regarding the food purchase in the urban and rural areas. Hence the advertisements should target them for effective marketing of their brands. There must be development of tea bars and coffee shops to encourage out-of-home consumption. They must provide a wide selection at affordable prices for the consumers. Awareness about the health benefits associated with the consumption of coffee and tea must be educated to the people.

iii.

iv.

v.

vi.

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UNIVERSITY OF AGRICULTURAL SCIENCES, DHARWAR Appendix I: INTERVIEW SCHEDULE Consumption behaviour of Coffee & Tea in Karnataka (Schedule for Individual Consumer Families) THE DATA WILL BE USED ONLY FOR RESEARCH PURPOSE Schedule No. : I. SOCIO-ECONOMIC CHARACTERISTICS a) District: c) City/Village: d) Name of the respondent: e) Age: f) Educational Qualification: Ill/PS/HS/SSLC/PUC/DEGREE/PG g) Occupation (Profession): i) Type of Family: Joint/Nuclear j) Family particulars: Adult Males: Adult Females: Children: h) Religion: b) Taluk:

k) Total Income of the family (monthly) Rs.______________________ l) Who makes buying decision in your family? ______________________ Age: II) Beverage Consumption: Beverage a) Coffee b) Tea Others: c) Plain milk d) Complan/ horlicks/ boost e) Rice starch water Quantity Purchased/month Price/Unit (Rs.) Total Expenditure Purchased from

III) Expenditure pattern (full details) FOOD ITEMS Cereals Pulses Vegetables Oils Beverages Milk Egg Meat Spices and condiments NON- FOOD ITEMS Clothing Cosmetics Transportation Entertainment Power and fuel Medicines Education Others (specify) Quantity Amount spent (RS./ month)

IV) Consumption Pattern of coffee and tea by family members


Relation with the head of the family Name of the coffee/tea consumed Quantity consumed (each time)

Age

M/F

Profession

Frequency of coffee/tea consumption

Place of coffee/tea consumption

Total Quantity consumed/day

V) Method of Preparation: a. How the coffee is usually made? Instant/ Boiled/ Percolated/ b. How the tea is usually made? Dip/ Boiled/ Percolated/

VI) Brand preference: a. Are you brand loyal? Yes/No b. If yes, name the Brand according to preference: I. Coffee: i)___________ II. Tea: i)___________ ii) ___________ ii) ___________ iii) _______________ iii) _______________

VII) Brand preferred: (Mark any one: Strongly Agree-4/ Agree-3/ Disagree -2/ Strongly Disagree -1) Coffee Reasons 1st 2nd 3rd 1st Tea 2nd 3rd

Brand name according to preference 1. Quality 2. Aroma 3. Flavor 4. Taste 5. Colour of end product 6. Brand image 7. Retailers influence 8. Influenced by other persons 9. Reasonable price 10. Timely Availability 11. Attractive packaging 12. Effective advertisements 13. Celebrity endorsements 14. Gifts/ Promotional strategies 15. Neighbors/friends /relatives influence Note: Strongly Agree-4, Agree-3, Disagree -2, Strongly Disagree -1 VIII) Whether family mbrs are having any social participation in NGO/ Gram Panchyath, etc IX) Whether increase in price affects the quantity demanded? X) Whether climate/ season change has any affect on coffee/tea consumption

UNIVERSITY OF AGRICULTURAL SCIENCES, DHARWAD DOCTORS QUESTIONNAIRE Consumption behaviour of Coffee & Tea in Karnataka (Information used for research purpose only) Schedule No. : 1. Name 2. Age 3. Qualification 4. Place & Address 5. Experience 6. a) Does coffee and tea consumption affect ones health? Yes/ No b) Age at which consumption of coffee or tea can be recommended: 7. How many cups of coffee per day is recommended for Children Male Teen age Working class Old age Frequency Quantity Female Frequency Quantity : : : : :

8. How many cups of tea per day is recommended for Children Male Teen age Working class Old age Frequency Quantity Female Frequency Quantity

9. At what interval is coffee and tea recommended: 10. What percent of caffeine is recommended per cup of: Coffee: Tea:

11. Coffee and tea consumption Sl no. Benefits Ill effects

12. Is it safe to consume caffeinated drinks during: After meals During pregnancy During nursing(lactating) While working late hours While performing heavy work Smoking : : : : :

13. Is it safe to consume caffeinated drinks for people suffering from: BP : Heart Diseases Diabetics Paralysis Asthma Cancer Any other : : :

Appendix II: Plan cards for coffee through conjoint analysis Card ID 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Name of the brand Nescafe Bru Nescafe Nescafe Bru Bru Nescafe Bru Kothas Bru Kothas Bru Bru Bru Kothas Kothas Price of the powder Low High High Medium Medium Medium High Low High High Medium High Low High Low High Type of packing Sealed Loose Loose Loose Sealed Sealed Sealed Loose Sealed Sealed Loose Loose Loose Sealed Sealed Loose Promotions associated No No Yes No Yes No Yes No No No Yes Yes Yes Yes Yes No Form of the powder Instant Filter Filter Instant Instant Filter Filter Filter Instant Filter Filter Instant Instant Instant Filter Instant

Appendix III: Plan cards for tea through conjoint analysis Card ID 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Name of the brand Red Label Taj Mahal Red Label Red Label Taj Mahal Taj Mahal Red Label Taj Mahal TATA tea Taj Mahal TATA tea Taj Mahal Taj Mahal Taj Mahal TATA tea TATA tea Price of the brand Low High High Medium Medium Medium High Low High High Medium High Low High Low High Packing material Sealed Loose Loose Loose Sealed Sealed Sealed Loose Sealed Sealed Loose Loose Loose Sealed Sealed Loose Promotions associated No No Yes No Yes No Yes No No No Yes Yes Yes Yes Yes No Form of the powder Dust Dip Dip Dust Dust Dip Dip Dip Dust Dip Dip Dust Dust Dust Dip Dust

CONSUMPTION BEHAVIOUR OF COFFEE AND TEA IN KARNATAKA


VARUN T.C. 2008 Dr. KERUTAGI M.G. Major advisor

ABSTRACT
The present study on consumption behaviour of coffee and tea was carried out during 2007-08 in selected four districts of Karnataka, by following multi stage sampling. Totally 240 sample households were randomly selected accounting to 932 respondents. Information was obtained by personal interview method. The important findings of the study are education of the respondents in the urban areas; and family size and price per unit of coffee in the rural area were highly significant with respect to demand for coffee. In case of demand for tea, the total family income in the urban areas and the family size in the rural areas were found to be highly significant. Majority of the respondents in the urban and rural areas of Northern Karnataka consumed tea, while coffee was consumed by 81.70 per cent of the urban and 63.80 of the rural respondents in the south. Bru and Nescafe were the two most preferred commercial brands of coffee and Red Label was the most preferred tea brand among the sample respondents. Quality, aroma, taste and flavour of coffee and tea obtained high index scores in both the urban and rural regions of Karnataka. Results of the Principal Component Analysis showed that celebrity endorsement and influence by retailers had little influence on the purchase of coffee/ tea. Results of the conjoint analysis revealed that price of coffee and tea powder attained the highest relative importance. The doctors who were interviewed for the study recommended the consumption of coffee and tea only after the age of 16 years. Around 20 per cent of the doctors opined that coffee and tea act as a stimulant and also reduces cardio-vascular diseases to some moderate extent.