CHAMELI DEVI INSTITUTE OF TECHNOLOGY AND MANAGEMENT INDORE

A study of influence of consumers disposable income on buying decision

A MAJOR RESEARCH PROJECT SUBMITTED FOR THE PARTIAL FULFILLMENT OF MASTER OF BUSINESS ADMINISTRATION DEGREE AWARDED BY-DAVV INDORE

RESEARCH GUIDE DR.ATUL VORA

RESEAECH CANDIDATESUMIT GOUR

CHAMELI DEVI INSTITUTE OF TECHNOLOGY & INDORE

Ro.No.- 082344620050

Certificate of Faculty Guide

This is to certify that Mr. Sumit Gour student of MBA program has completed his MRP entitled A study of influence of consumers disposable income on buying decision under my guidance. He carried this project with full sincerity & declaration.

Date:Faculty Guide Dr.Atul Vora

Declaration by Student
I here by declare that the project report entitle A study of influence of consumers disposable income on buying decision submitted by me to the CHAMELI DEVI INSTITUTE OF TECHNOLOGY & MANAGEMENT INDORE for the consideration for the award of Master Degree of Business Administration (MBA) represented by my own work except for the guidance and suggestion received, which have been suitably acknowledged. I further state that this work doesnt form part of my or any other report submitted this or any other University/Institute for the award of any degree or diploma.

Sumit gour

Date: Place:

Acknowledgement

This project has been a truly educative and enlightening experience for me, one that has seen me grow in professionally and personally by expanding my domain knowledge, for this I would like to thank the following people without whom this project could not be completed. First I would like to thank to all staff specially Dr.Atul Vora who has been helpful throughout the project.

Contents
Chapter 1. Introduction A: Conceptual framework B: Review of literature C: Objective of the study D: Hypothesis 2. Methodology A: The Study B: The Research Design C: The Sample D: The Tool Used a. 3. 4. 5. 6. 7. 8. For Data Collection b. For Data Analysis Data Analysis & Discussion Conclusion Limitation Suggestion & Implication of The Study References Appendices A: Questionnaire
5

Particulars

Page No. 7 21 22

24 24 24 24 25 27 38 40 43 44 46

INTRODUCTION

A) Conceptual framework

Income or economical situation of a person is one of the factors which influence the behavior of any individual during buying or purchasing of goods and services. Income is a physiological factor which influences the behavior of consumer. Income is not only the thing which can decide consumer behavior, because every individual differ from that of others in perception as well as their needs are different. Possibly the most challenging concept in marketing deals with the understanding why buyers do what they do (or dont do). But such knowledge is critical for marketer since having strong understanding of buyers behavior will help shed light on what is important to the customer and also suggest the important influences on customer decision making. Using this information, marketers can create marketing programs that they believe will be of interest of consumers. So we need to consider disposable income as a base for knowing their behavior based on their income. Disposable income is income which remains after tax reduction. Buyers behavior is deeply rooted with psychology with dashes of psychology thrown in just to make things interesting. Since every person in the world is different, it is impossible to have simple rules that explain how buying decision are made. Consumer behavior refers to selection purchase and consumption of goods and services for the satisfaction of their wants. Presently the Indian economy is $1 trillion. From the past few years disposable income of an average Indian is rising because of the increase in middle and upper middle consumer income, and this is the factor which enabling them to spend more and more Consumers income could be divided in following groups. Money or nominal income: money received Real income purchasing power of money Disposable income money left after compulsory deductions Discretionary income income which can be used as we please after allowing for

regular commitments such as utility bills etc.

Disposable income
8

Disposable income is total personal income minus personal current taxes. In national accounts definitions; personal income minus personal current taxes equals disposable personal income. Subtracting personal outlays (which includes the major category of personal (or, private) consumption) yields personal (or, private) savings. Consumption expenditure plus savings equals disposable income after accounting for transfers such as payments to children in school or elderly parents living arrangements. The marginal propensity to consume (MPC) is the fraction of a change in disposable income that is consumed. For example, if disposable income rises by $100, and $65 of that $100 is consumed, the MPC is 65%. Restated, the marginal propensity to save is 35%. The lowered disposable income is recognized to be the greatest challenge for the consumers' purchasing activities. All of the interviewees described that lowered disposable income makes them feel more careful when buying particular products. They also revealed that they are likely to discuss their purchases and shopping lists with their families or close friends in order to achieve greater buying efficiency in terms of buying the best quality for the amount of financial value they sacrifice. This suggests that group influence would be a great determinant of customer behavior, which is an interesting context for further academic research as it would be valuable for a wide range of academic and commercial parties to gain more insight on the way peer pressure affects consumers during an economic crisis. The interviewees revealed that when they discuss purchases they are most interested in the price-quality ratio and the transaction costs, which they are likely to experience during the buying processes. However, they also shared that price and quality are important determinants but many of them still identify the process of purchasing as a pleasurable event and therefore customer service and in-store environment are of high importance. A person buying behavior is a true reflection of the social class he/she belongs to. Social class is basically determined by the level of income of a person. And as a matter of fact every individual spends according to the spending capacity he has, which, in turn, is determined by his level of income. Social class determines what a person would buy, and in what quantity. It also determines the frequency of use of a product. For more details see the link below:
9

Discretionary income
It is the income after subtracting taxes and normal expenses (such as rent or mortgage, utilities, insurance, medical, transportation, property maintenance, child support, inflation, food and sundries, &c.) to maintain a certain standard of living. It is the amount of an individual's income available for spending after the essentials (such as food, clothing, and shelter) have been taken care of:

Discretionary income = Gross income - taxes necessities

Despite the formal definitions above, disposable income is commonly used to denote discretionary income. The meaning should therefore be interpreted from context. Commonly, disposable income is the amount of "play money" left to spend or save. The Consumer Leverage Ratio is the expression of the ratio of Total Household Debt to Disposable Income.

10

Per capita income

Per capita Income means how much an individual earns, of the yearly income that is generated in the country through productive activities. Per capital income of India means income of each Indian if national income is evenly divided among the country's population of 117 crore. Avg per capita income of India$441.56 per person.

C ng inp c p inc e inInd in$ ha es er a ita om ia

2002 2003 2004 2005 2006 2007 2008

70 0 60 0 50 0 40 0 30 0 20 0 10 0 0 20 02 20 03 20 04 20 05 2 06 0 2 7 00 20 8 0

The per capita income grew by 10.5 per cent to Rs 44,345 in 2009-10 against Rs. 40,141 in the year-ago period, according to the government.

11

Consumer behavior
Consumer behavior is the study of when, why, how, and where people do or do not buy a product. It blends elements from psychology, sociology social anthropology and economics. It attempts to understand the buyer decision making process, both individually and in groups. It studies characteristics of individual consumers such as demographics and behavioral variables in an attempt to understand peoples want. It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general. Customer behavior study is based on consumer buying behavior, with the customer playing the three distinct roles of user, payer and buyer. Relationship marketing is an influential asset for customer behavior analysis as it has a keen interest in the re-discovery of the true meaning of marketing through the re-affirmation of the importance of the customer or buyer. A greater importance is also placed on consumer retention, customer relationship management, personalization, customization and one-to-one marketing. Social functions can be categorized into social choice and welfare functions. Each method for vote counting is assumed as social function but if Arrows possibility theorem is used for a social function, social welfare function is achieved. Some specifications of the social functions are decisiveness, neutrality, anonymity, monotonicity, unanimity and homogeneity and weak and strong .No social choice function meets these requirements in an ordinal scale simultaneously. The most important characteristic of a social function is identification of the interactive effect of alternatives and creating a logical relation with the ranks. Marketing provides services in order to satisfy customers. With that in mind, the productive system is considered from its beginning at the production level, to the end of the cycle.

12

Types of Consumer Behavior

There are four distinctive buying behavior patterns which can be outlined. They differ with respect to the frequency of occurrence, emotional involvement, decision-making complexity and risk such as: 1) Programmed behavior. 2) Limited decision-making buying behavior. 3) Extensive decision-making buying behavior. 4) Impulsive buying. Programmed behavior, also known as habitual buying behavior, is the buying pattern which can be characterized as the routine purchasing of low cost items. Limited decision-making buying behavior can be characterized as a buying pattern that involves moderate levels of decision-making and comparatively low amounts of required information to trigger purchasing. Extensive decision-making buying behavior.This type of behavior is characterized with complex decision-making, where the buyer needs a comparatively longer period to make a decision and greater amounts of information gathering. Impulsive buying is characterized as a buying process that does not involve any conscious planning. It is a short-term phenomenon, which is usually provoked by an external stimuli and irritation, making particular products irresistible to consumers at a given short period of time.

13

Factors Affecting Consumer Behavior

1) Cultural Factors Consumer behavior is deeply influenced by cultural factors such as: buyer culture, subculture, and social class. Culture Basically, culture is the part of every society and is the important cause of person wants and behavior. The influence of culture on buying behavior varies from country to country therefore marketers have to be very careful in analyzing the culture of different groups, regions or even countries. Subculture Each culture contains different subcultures such as religions, nationalities, geographic regions, racial groups etc. Marketers can use these groups by segmenting the market into various small portions. For example marketers can design products according to the needs of a particular geographic group. Social Class Every society possesses some form of social class which is important to the marketers because the buying behavior of people in a given social class is similar. In this way marketing activities could be tailored according to different social classes. Here we should note that social class is not only determined by income but there are various other factors as well such as: wealth, education, occupation etc. 2) Social Factors Social factors also impact the buying behavior of consumers. The important social factors are: reference groups, family, role and status.
14

 Reference Groups Reference groups have potential in forming a person attitude or behavior. The impact of reference groups varies across products and brands.

Family Buyer behavior is strongly influenced by the member of a family. Therefore marketers are trying to find the roles and influence of the husband, wife and children. If the buying decision of a particular product is influenced by wife then the marketers will try to target the women in their advertisement. Here we should note that buying roles change with change in consumer lifestyles. Roles and Status Each person possesses different roles and status in the society depending upon the groups, clubs, family, organization etc. to which he belongs. For example a woman is working in an organization as finance manager. Now she is playing two roles, one of finance manager and other of mother. Therefore her buying decisions will be influenced by her role and status. 3) Personal Factors Personal factors can also affect the consumer behavior. Some of the important personal factors that influence the buying behavior are: lifestyle, economic situation, occupation, age, personality and self concept. Age Age and life-cycle have potential impact on the consumer buying behavior. It is obvious that the consumers change the purchase of goods and services with the passage of time. Family life-cycle consists of different stages such young singles, married couples, unmarried couples etc which help marketers to develop appropriate products for each stage. Occupation The occupation of a person has significant impact on his buying behavior. For example a marketing manager of an organization will try to purchase business suits, whereas a low level worker in the same organization will purchase rugged work clothes.

15

 Economic Situation Consumer economic situation has great influence on his buying behavior. If the income and savings of a customer is high then he will purchase more expensive products. On the other hand, a person with low income and savings will purchase inexpensive products.

Lifestyle Lifestyle of customers is another import factor affecting the consumer buying behavior. Lifestyle refers to the way a person lives in a society and is expressed by the things in his/her surroundings. It is determined by customer interests, opinions, activities etc and shapes his whole pattern of acting and interacting in the world. Personality Personality changes from person to person, time to time and place to place. Therefore it can greatly influence the buying behavior of customers. Actually, Personality is not what one wears; rather it is the totality of behavior of a man in different circumstances. It has different characteristics such as: dominance, aggressiveness, self-confidence etc which can be useful to determine the consumer behavior for particular product or service. 4. Psychological Factors There are four important psychological factors affecting the consumer buying behavior. These are: perception, motivation, learning, beliefs and attitudes. Motivation The level of motivation also affects the buying behavior of customers. Every person has different needs such as physiological needs, biological needs, social needs etc. The nature of the needs is that, some of them are most pressing while others are least pressing. Therefore a need becomes a motive when it is more pressing to direct the person to seek satisfaction. Perception Selecting, organizing and interpreting information in a way to produce a meaningful experience of the world is called perception. There are three different perceptual processes which are selective attention, selective distortion and selective retention. In case of selective attention, marketers try to attract the customer attention.
16

Whereas, in case of selective distortion, customers try to interpret the information in a way that will support what the customers already believe. Similarly, in case of selective retention, marketers try to retain information that supports their belief. Beliefs and Attitudes Customer possesses specific belief and attitude towards various products. Since such beliefs and attitudes make up brand image and affect consumer buying behavior therefore marketers are interested in them. Marketers can change the beliefs and attitudes of customers by launching special campaigns in this regard.

Black box model

ENVIRONMENTAL FACTORS Marketi ng Stimuli

BUYER'S BLACK BOX Buyer Characterist ics BUYER'S RESPONSE

Environmen tal Stimuli

Decision Process

Product Price Place Promotio n

Economic Technologica l Political Cultural Demographic Natural

Attitudes Motivation Perceptions Personality Lifestyle Knowledge

Problem recognition Informatio n search Alternative evaluation Purchase decision Postpurchase behavior

Product choice Brand choice Dealer choice Purchase timing Purchase amount

The black box model shows the interaction of stimuli, consumer characteristics, and decision process and consumer responses it can be distinguished between interpersonal stimuli (between people) or intrapersonal stimuli (within people). In that
17

model the focus is not set on the processes inside a consumer, but the relation between the stimuli and the response of the consumer. The marketing stimuli are planned and processed by the companies, whereas the environmental stimulus is given by social factors, based on the economical, political and cultural circumstances of a society. The buyers black box contains the buyer characteristics and the decision process, which determines the buyers response.

Consumers purchasing model

18

Need recognition
Need recognition is the first and foremost step of consumer purchasing behavior, needs are different for different one sometimes organizations need becomes platform for purchasing, marketer works on the need of consumer some needs are created by marketer need recognition gives the right direction to the process of information search.

Information search
Once the consumer has recognized a problem, they search for information on products and services that can solve that problem. Belch and Belch (2007) explain that consumers undertake both an internal (memory) and an external search. Sources of information include: Personal sources Commercial sources Public sources Personal experience

The relevant internal psychological process that is associated with information search is perception. Perception is defined as "the process by which an individual receives, selects, organizes, and interprets information to create a meaningful picture of the world".
19

The selective perception process

Stage Description Selective exposure consumers select which promotional messages they will expose themselves to. Selective attention consumers select which promotional messages they will pay attention to. Selective comprehension consumer interprets messages in line with their beliefs, attitudes, motives and experiences. Selective retention consumers remember messages that are more meaningful or important to them.

Evaluation of alternatives
At this time the consumer compares the brands and products that are in their evoked set. How can the marketing organization increase the likelihood that their brand is part of the consumer's evoked (consideration) set? Consumers evaluate alternatives in terms of the functional and psychological benefits that they offer. The marketing organization needs to understand what benefits consumers are seeking and therefore which attributes are most important in terms of making a decision.

Purchase decision
Once the alternatives have been evaluated, the consumer is ready to make a purchase decision. Sometimes purchase intention does not result in an actual purchase. The marketing organization must facilitate the consumer to act on their purchase intention. The organization can use variety of techniques to achieve this. The provision of credit or payment terms may encourage purchase, or a sales promotion such as the opportunity to receive a premium or enter a competition may provide an incentive to buy now. The relevant internal psychological process that is associated with purchase decision is integration. Once the integration is achieved; the organization can influence the purchase decisions much more easily.

Post Purchase evaluation

20

The EKB model was further developed by Rice (1993) which suggested there should be a feedback loop, Foxall (2005) further suggests the importance of the post purchase evaluation and that the post purchase evaluation is a key due to its influences on future purchase patterns.

Consumer behavior with price changes in market

One of the key analyses under the heading "consumer behavior" refers to the interaction between price changes and consumer demand. From introductory economics we know that a reduction in the price of X will result in an overall rise in the quantity demanded of good X. However, this rise in the quantity demanded is due to the total price effect, which can be subdivided into two separate parts, the substitution effect and the income effect. The substitution effect refers to the extra purchase of good X now that it is, after the price fall, relatively cheaper than other substitutes in consumption. The income effect refers to the rise in real income (purchasing power) now that the price of one commodity is lower within the bundle of commodities purchased by the consumer. This extra real income can potentially be used to buy more of all commodities, including X.

Total price effect = substitution effect + income effect

In terms of rules associated with the law of demand, the substitution effect will always be negative. The income effect can be positive, zero or negative.

21

Textbooks should provide more detail about the theory behind consumer behaviour. Unfortunately, to find good data on the Web in this area is incredibly difficult, as they are highly commercial and therefore expensive. Organizations like Mintel and Keynote provide marketing reports based on extensive market research into consumer behaviour across all sectors. Information services or libraries should be approached to find out how to access this information either online or in hard copy. One consumer research organization site is noted here.

B) Review of literatureTop 20 Indian Cities that accounts for 1/3rd of disposable Income A study by Roopa Purushothaman and Rajesh Shukla (co-authored Goldman Sachs famous BRIC report) has conducted a study (on behalf of Kishore Biyanis Future Capital Research and National Council of Applied Economic Researchs (NCAER)) The authors have identified 20 key cities (which accounted for ~$100-billion of consumption expenditure in 2007-08) and grouped them into three broad buckets Megacities: Largest cities in terms of population/market - Mumbai, Delhi, Kolkata, Chennai, Bangalore, Hyderabad, Ahmadabad and Pune. Boomtowns: Next set of big population cities with high expenditure per household- Surat, Kanpur, Jaipur, Lucknow, Nagpur, Bhopal and Coimbatore. Niche cities: Smaller in terms of overall population, but still hit well above their weight in spending per household-Faridabad, Amritsar, Ludhiana, Chandigarh and Jalandhar.
22

C) Objective of the study-This study is about the influence of

consumers disposable income on buying decision, as purchasing behavior of consumer is influenced by many factors & income is one of the physiological factors. Our study shows the buying pattern of different income consumer towards different products.

23

INCOME LEVEL
Below 10,000 10,000-18,000 18,000-24,000 More then 24,000 Lower income level Lower Middle Middle Higher

HypothesisHo1-People of higher income level takes insurance rather than lower income level.

Ho2-People of Middle & higher income level have their own house.

Ho3-People having income more then 10,000 goes outside for vacation.

Ho4-Higher income level goes outside maximum time to watch movie.

Ho5-People of higher income level (24,000) have their own car.

Ho6-Maximum no. of people from lower income level doesnt purchase cloth from shopping mall.

Ho7-People of every income level goes equally outside for dinner.

24

Ho8-People of income level less then 10,000 doesnt spend more then 800 on childrens education.

Ho9-Income level does not have more effect on spending pattern on mobile recharge.

METHODOLOGY

The studyThis is an exploratory type of research. This undertakes to analyze the influence of consumers disposable income on buying decision
25

The designThe research design will be conclusive in nature and would focus on the accurate description of consumers behavior based on their income level.

The sampleThe study is all about different income level of people, so we examined 50 people and divide them in four categories according to their income.

The Tools usedFor Data collection-Impact of income on decision-making in buying behavior. This type of behavior is characterized with complex decision-making, where the buyer needs a comparatively longer period to make a decision and greater amounts of information gathering.
a)

Primary Data - The present dissertation incorporates a multi-method research process, where the researcher combines secondary and primary data in the same study. Primary data contributes to the researcher's ability to address the most important issues in the present context. The primary data is extracted through the fulfillment of structured questionnaire.

Secondary Data- The secondary data employed can be described as multiple source secondary data. The use of multiple source data provides the researcher with the opportunity to develop a balanced and analytical dissertation. The academic literature is used for outlining the academic context of consumers' buying behavior, whereas the commercial sources are used for identification of the current conditions.

Designing the Questionnaire

A questionnaire is consists of a set of questions presented to respondents. Because of its flexibility the questionnaire is by far the most common instrument used to collect primary data.
26

While preparing this questionnaire, the form, words and sequence of the questions were chosen very carefully. Care was taken not to influence the response of the respondents by asking them biased questions or showing any sort of biasness towards the results.

The questionnaire prepared is mix of open-ended and close-ended type of questions presented in a sequential form as not to deviate the flow to the information required.

The open-ended question were asked to know the views of customer regarding the product or services expected from the company or the distributor and the closeended question asked to collect the basic demographic information along with preferences about the value added services and products which the company intend to provide.

b) For Data Analysis- For data analysis we divided the respondents in to 4 categories according to income. And by % analysis we found the weight of different option of different income level.

DATA ANALYSIS
27

& DISCUSSION

Data Analysis
1) What is your household income?

Income level
Below 10,000 10,000-18000 18,000-24000 More than 24000

No of con.
11 18 8 13

%
22 36 16 26

28

Graph no 1.1

It is the percentage of different income level of consumers which were found by conducting research on the sample of 50,This graphs segments the sample in different level Which will be helpful for analyzing other topics related to consumers behavior.

2) Do you have insurance?

Income level
Below 10,000 10,000-18000 18,000-24000 More than 24000

Yes (%)
64 67 100 85

No (%)
36 33 0 15

29

120 100

Consumer with insurance

Graph no 1.2

This 80 graph shows 60 that more 40 then 60% 20 people 0 from > 10000 10000 -18000 18000 -24000 <24000 each income level have insurance, people with income level 18,000-24,000 Maximum (100%) of people having insurance.

3) Do you have your own house?

Income level
Below 10,000 10,000-18000 18,000-24000 More then 24000

Yes (%)
64 61 88 69

No (%)
36 39 12 31

30

Graph no 1.3

This graphs shows that consumers whose income level is between 18000-24000 has the Highest (88%) of having their home, although the % of income level more then 24000 who has their own house is 69% .

4) Do you like to go outside for vacation?

Income level
Below 10,000 10,000-18000 18,000-24000 More than 24000

Yes (%)
55 67 75 62

No (%)
45 33 25 38

31

%of consumer like to g outside for o vacation

80 70 60 50 40 30 20 10 0

Graph no 1.4

goes goes

Maximum % of people from income level ranging from Below 10000 10000-18000 18000-24000 More then 24000 18,00024,000 outside for vacation and people from other income level more then 55 % people outside for vacation.

5) Do you have a car?

Income level
Below 10,000 10,000-18000 18,000-24000 More than 24000

Yes (%)
9 17 50 69 50

No (%)
91 83

31

32

Graph no 1.4

This graph shows that purchasing of car is directly related with the income of consumer, more the income more the people buy the car.

6) How many times do you go movie in a month? Never (%)

Below 70 10,000
60
45

Once (%)
36

Twice (%)
19

Thrice (%)
0

Every week (%)

0

10,00018,000 50 18,000- 40 24,000 < 24,000

30 20 10 0 Never

28

28

39

Below 10000
0 8 63 46 25 22 12 8

10000-18000 0 18000-24000 < 24000

16

33

Once

Twice

Thrice

Every week

Graph no 2.1

This graph shows that maximum (63%) of consumer of income level below 18,00024,000 goes for movie once in a month. Maximum no. of people go two time movies in a month.

7) From where do you purchase cloths? Malls (%)

Below 10,000 10,000-18000 18,00024,000 More then 24,000 9 39 50 54

Shops (%)
73 39 13 39

Both (%)
18 22 37 7

34

Graph no 2.2

This graph shows that only (9%) of consumer of income of below 10,000 go for malls to shop and 73 % goes on shops.

8) How many times do you go outside for dinner in a month?

Never (%)
Below 10,000 10,00018000 18,00045

Once (%)
36

Twice (%)
19

Every week (%)

0

Frequently (%)
0

28

28

39

63

25

12

35

24,000 < 24,000

8 46 22 8 16

Graph no 2.3

From that graph it could be implemented that maximum people (81) having income below 10000,Go twice outside for dinner in a month and 63% people of income level 18000-24000 goes once in a month outside for dinner.

9) How much money do you spend on your childrens education in a month?

36

Nothing (%)
Below 10,000 10,00018000 18,00024000 <24,000 0 61 25 46

<200( %)
36 0 25 8

200400(%)
15 11 0 0

400800(%)
15 6 25 0

<800( %)
44 22 25 46

70 60 50 40 30 20 10 0 Nothing(% ) < 200 200-400 400-800 < 800 Below 10000 10000-18000 18000-24000 More then 24000

Graph no 2.3

From the above graph it could be implemented that more people from the income level from 10,000-18,000 does not spend no money on childrens education, and most people append more then 800 Rs. In a month.

37

10) How much money do you spend on your mobile recharge in month? Less the 100
Below 10,000 10,00018,000 18,00024,000 < 24,000 27 0 0 0

100200
38 50 38 23

200400
27 44 37 23

400800
8 6 25 54

Graph no 2.4

From above graph it could be implemented that only 27% of consumer of income of below 10000 spend less than 100 Rs. In a month and 54 % of consumer having income more then 24000 spend more then 800 in a month on mobile recharge. Maximum no of people spend 100-200 on mobile recharge in a month.

38

CONCLUSION

Conclusion- Consumer behavior is a complex phenomenon, I found that

consumer followsbehave differently for different products following conclusions are as 1)100% people from middle income level (18,000-24,000) takes insurance and 85% people of higher income level takes insurance .(From graph 1.2) 2)60% people from each income level have their own house maximum no. of people from 18,000- 24,000 have their own house.( From graph 1.3)

39

3) People from each income level go outside for vacation & the no. increases with income.( From graph 1.4) 4) People having income more then 18,000 50% people have car. (From graph 1.5) 5) Maximum people from middle income (18,000-24,000) go movie. Income level more then 18,000 goes lesser. (From graph 1.3) 6) Only 9% people from lower income level (10,000) go mall for shopping. (From graph 2.1) 7) More then 50% people from each income level go outside for dinner, Maximum no. people from middle income (18,000-24,000) in them. . (From graph 2.2) 8) People even from Low income level (Below 10,000) spend more then 800 in a moth on childrens education (.Graph no 2.3) 9) Beside Lower income (Below 10,000) each income level of people spend more then 100 in a month Graph no2.4).

LIMITATION

40

Limitations

Consumer buying behavior is influenced by so many factors so it is difficult to determine the impact of a particular factor like income level of consumer. Consumer buying behaviors also determined by the demographic factors the implications of study could be irrelevant for other demography. Consumer buying behavior also depends on their past economic situation, which decides the need for a particular product.

41

SUGGESTION AND IMPLICATION

42

Suggestions and Implications of the studySome suggestions are as follows More then 60% of people from different income level buy insurance, so insurance company can get the benefit of huge amount of consumers by providing them suitable option of investment. More then 50% people from each income level go outside for vacation and this % increases with the income. People of income level from 10,000-18,000 are the prospectus consumer for tourism industry. People whose income is more then 18,000 buy car, automobile can be benefited by them; people of income level below 18,000 could be customers if they get it in cheaper price. Most the people from income level below 10,000 does nt go for movie which can be targeted audience by lower price of entertainment. People from income level from 0- 18,000 go more outside for dinner. People of each income level spends more then Rs.100 on recharge in a month.

People from each income are ready to pay more then 800 monthly for their childrens good education.

43

REFERENCES

ReferencesWebsites www.wikipidia.com www.internationalbusiness.wikia.com www.expressindia.com www.tradechakra.com www.manage indiabudget.nic.in www.mentparadise.com

44

BooksManagerial Economics By D.N. Dwiedi Business research methodology By William G.zikmund Consumer Behavior & market strategy By J Paul Peter Jerry colson Consumer behavior By Leon G.shiffman

APPENDICES

45

AppendicesQuestionnaire for conducting survey for impact of consumers disposable income on buying behavior This research is being done purely for academic purpose, I promise hereby that the information you are providing me will not be given anybody else for any purpose! NameOccupation1) What is your household income? Below 10,000 10,000-18,000 18,000-24,000 More than 24,000 2) Do you have insurance? Yes No

3) Do you have your own house? Yes No

4) Do you like to go outside on vacation? Yes No

5) Do you have car?

46

Yes

No

6) How much time do you go for movie in a month? Once Twice Thrice Four times 7) From where do you like to shop for cloths? Shopping malls Shops Both 8) Do you like to go outside for dinner? Never Once Twice Thrice Four times

9) How much money do you spend on your childrens education monthly? Nothing Less than 200 200-400 400-800 More than 800

47

10) How much money do you spend on your mobile recharge in a month? Less than 100 100-200 200-400 400-800 Thank you very much for giving your precious time and information!

48