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RETAIL OUTLETS
PRINCIPLES OF MARKETING
CCA1009 E1 SLOT-GROUP 10
SUBMITTED BY
PROF. R. GEETHA
DEPARTMENT OF COMMERCE
VELLORE.
OCTOBER, 2016.
CONTENTS
1.1 INTRODUCTION
Every business conducted for the purpose of selling or offering for sale any goods, wares, or
merchandise, other than as a part of a "wholesale business" to the final consumer can be defined
as retail business
Retail is the second-largest industry in the United States both in number of establishments and
number of employees. The U.S. retail industry generates $3.8 trillion in retail sales annually
($4.2 trillion if food service sales are included), approximately $11,993 per capita. The retail
stores are one of the largest sectors worldwide.
Retailing is the final step in the distribution of merchandise - the last link in the Supply Chain
- connecting the bulk producers of commodities to the final consumers. Retailing covers
diverse products such as foot apparels, consumer goods, financial services and leisure. The
organized retail sector is expected to grow at 6% by 2010 and touch a retail business of $ 17
billion as against its current growth level of 3%, which at present is estimated to be $ 6 billion.
As India moves towards the service oriented economy, a rise in this percentage is expected.
The number of the retail outlets is growing at about 8.5% annually in the urban areas and in
towns with population between 1,00,000 to 1 million; the growth rate is about 4.5%. Organized
retailing is witnessing a wave of players entering the industry. These players are experimenting
with various retail formats.
Yet, Indian retailing has still not been able to come up with many successful formats that can
be scaled up and applied across India. Some of the notable exceptions like Reliance Retail &
Vishal Mega Mart who scaled their Retail format across the country.
This research project is undertaken with a view to analyse the trends in the Indian Organized
Retail Industry with reference to changing trends in buying behaviour of consumers. The aim
is to understand the effect of increasing income levels of consumers on the organized retail
industry.
In this competitive world, we can see many problems in marketing of any product or service.
Some problems can be solved, but so many problems may not be solved. India is a developing
country and retail marketing is an important one to develop a countrys economy. Retailers,
who are the connecting link between the producer and consumer, face many problems to market
their products from various dimensions and many causes behind this. At present the customers
are also more dynamic. The customers have certain expectations from the items they purchase
such its quality, price, good
services etc. Hence, there is a need for a research work in the field of problems of retail
marketing in the point of view of retailers and customers as well
To re-standardize and to modify the measure of brand image and consumer purchase
intention.
To identify the factors underlying brand image and consumer purchase intention.
To establish the cause & effect relationship between Brand Image and consumer
purchase intention.
To assess the perception of a consumer towards a particular brand is in direct relation
to the image of the brand.
H1: Demographic variables have an impact on the buying behaviour of consumers while
shopping for apparels in organized retail outlets;
H2: Various store related factors influence the buying behaviour of consumers while shopping
for apparels in organized retail outlets.
H1.2: Age has an impact on the buying behaviour of consumers while shopping for apparels in
organized retail outlets.
H1.3: Marital Status has an impact on the buying behaviour of consumers while shopping for
apparels in organized retail outlets.
H1.4: Income has an impact on the buying behaviour of consumers while shopping for apparels
in organized retail outlets.
H1.5: Education has an impact on the buying behaviour of consumers while shopping for
apparels in organized retail outlets.
CHAPTER-II
REVIEW OF LITERARTURE
2.1 INTRODUCTION
Retail is India's largest industry. It accounts for over 10 per cent of the India's GDP and around
eight per cent of the employment. Retail sector is one of India's fastest growing sectors with a
5 per cent compounded annual growth rate. India's huge middle class base and its untapped
retail industry are key attractions for global retail giants planning to enter newer markets.
Driven by changing lifestyles, strong income growth and favourable demographic patterns,
Indian retail is expected to grow 25 per cent annually. It is expected that retail in India could
be worth US$ 175-200 billion by 2016.
Goldman A (2001) in his article entitled The Transfer of retail formats into developing
countries: The example of China stated that the retail format has the ability to recognize the
capacities of the sellers. It could make the company to earn return on investments higher than
the cost of investments. It acts as a driver which attracts the shoppers. There is an evolution in
the retail format of developing countries which place themselves competitively in national and
international level. From the year 1990, there has been a revolution in Indian retail format.
Anand K.S. and Sinha P.K (2009) in his article entitled Store format, choice in an evolving
market: role of affect cognition and involvement stated that though there is an extreme
transition in Indian retail format, only five (5 percent) percentage of overall retail market has
been occupied by organized retail sector. Open market, sandy, street shops and grocery store
are the major segments of the retail market in India. Further they have also explained that the
customers priorities are being changed with respect to the availability of the retail formats. So
it is difficult to predict the attitude of the shoppers. As an example, the customers may visit
grocery shop either for bulk or small purchase.
Block Lauren G. and Morwitz Vicki G (1999) in his article entitled Shopping lists as an
External Memory Aid for Grocery Shopping: Influence on List Writing and List Fulfilment
stated that fill-up purchase is found to be a common and spontaneous. If the shoppers require
anything urgently, they will reach the nearby street shops. This is called obsessive purchasing.
But the shoppers have a tendency to carry out the Bulk grocery purchase in a periodic and
planned manner and these types of purchases have been influenced by utilitarian motivations.
The shoppers perspectives on functional features of the retail sectors in response to the
changes in the retail format and the shopping value gained by the customer through the retail
formats have been focused only by few researchers.
Yoon K. and Tran T.V (2011) in his article entitled Capturing consumer heterogeneity in
loyalty evolution patterns stated that the outcomes of a profitable venture are based on the
satisfaction and preference of a consumer. The customers are influenced by purchase intention
and there is an unexpected increase in terms of market share and loyalty of the customers.
Divett M., Crittenden N. and Henderson R (2003) in his article entitled Actively influencing
consumer loyalty stated that the increase in consumer loyalty is considered as one among the
essential strategies of marketing which is been identified by the researchers. It is therefore
important to ensure that there is understanding of all the facets of consumer interests in order
to understand brand loyalty and brand preferences. The consumer preferences towards one
particular brand or retailer maybe associated with determination of specific factors with regards
to consumer attitude and behaviour.
Odin Y. and Valette Florence P (2001) in his article entitled Conceptual and Operational
Aspects of Brand Loyalty an Empirical Investigation stated that behaviour and attitudes are the
two terms in concern to loyalty to a brand. In addition, Aaker also explained that the
attachment that a customer has to a brand is the phrase given to signify the loyalty of a
customer to a particular brand. Divett points out that when the customer is given with many
choices, he opts for the first choice in selecting a specific brand considering it as a tendency of
the customer to be loyal is called as the brand loyalty. If a particular brand is continually
obtained by the consumers, then its regarded as the promotion of consumer loyalty with
respect to their behaviour. In addition, it can be identified that it is cheaper and easier in terms
of measuring the cost of the product.
Keller K.L (2001) in his article entitled Building Customer-Based Brand Equity that it is
important that the brand loyalty should be promoted as it helps in counting the popularity of
the product and further can help in promoting repeat patronage. This leads to benefit in terms
of the cost of measurement. The reason for the company to develop its brand as stronger and
successful is to establish itself stronger in the market. Perrier identified that the earlier literature
in this field has exposed the need for better brand management and the establishment of a good
brand structure as a basic cause in many organizations. The success of a brand and presentation
of relative measures of a market place is associated with the performance of a brand. Thus, the
performance of the brand is directly associated with the objectives of an organization within a
particular market background.
LaxmiPrabha.G. (2007) in her study focused to study the prospects and problem of Indian
Retailing one of the major concerns of retail is shoplifting, shoplifters use different
shoplifting techniques for the theft. It is done deliberately with the intention of robbing the
processor for the particular piece of property that has been stolen from the retail establishment.
Amatual Baseer (2007) studied in his research about Emerging Trends in India, The
demanding ascertain Indian consumer is now sowing the seeds for an exciting retail
transformation that he already started bringing in larger interest from international brands /
formats. With the advent of these players, the race is on to please the Indian customer and its
time for the Indian customer sit back and enjoys the hospitality of being treated like a King.
Hariharan.G. (2008) in his study profile and perception of retail consumers, analysed the
consumers perception towards retail, in Palakkad. Visiting retail outlets has become a group
activity. Most of the shoppers are influenced by as well as accompanied by colleagues, friend
and relatives. Majority of the people who visit do not shop at all. The hang around meet friends,
do window shopping and spend time leisurely.
2.3 CONCLUSION
Review of literature was an exhaustive task which helped the researcher to get an insight of
retail sector not only in India but also in abroad. The researcher reviewed several books devoted
to the conceptual understanding to retailing and the conceptualities related to marketing. The
reading has helped the researcher to get an in-depth knowledge and understanding about retail
marketing management.
Over the past several decades, modern retailing has become increasingly global in scope. The
term globalization of retailing encompasses many interrelated developments such as (1) major
retailers based on mature markets establishing a market presence in countries in different stages
of economic development, (2) the supply chain undergirding the operations of retailers
becoming increasingly global in scope, and (3) the diffusion of retailing innovations in various
parts of the world. By and large, the retail market environment in numerous countries
worldwide has been subject to the influence of globalization forces. The influence of these
globalization forces is evident with regard to various aspects of retailing such as the retailing
supply chain, product assortment, store format, and branding.
Most of the authors are concentrating on understanding consumers responses to different retail
formats and marketing strategies. Studies are being conducted to analyse and explain marketing
strategies and trends of organized retailers. The researchers are trying to identify the factors
that are responsible for changes in approaches of global retail players towards consumers and
advancement in developing countries. In India, researches are being conducted to know about
emergence of organized retailing and its impact on consumer behaviour.
CHAPTER-III
RESEARCH METHODOLOGY
3.1 INTRODUCTION
In order to accomplish the objectives of the study, it is essential to articulate the manner in
which it is to be conducted, i.e., the research process is to be carried-out in a certain framework.
The Research Methodology, which follows, is the backbone of the study.
The research will be descriptive in nature. The researcher consulted various magazines,
newspapers, books, reference materials and internet.
Individual customers in the age range of 15 to 60 years old were selected for the study. The
questions were multiple choice. There were equal number of males and females. An individual
customer was treated as element of study.
PRIMARY DATA
Primary data was collected from 100 respondents by sending the questionnaire form to the
consumer through WhatsApp and Facebook with the help of google docs. The respondent filled
the data and submit through the link. The unfilled data were rejected and the filled data were
analysed.
SECONDARY DATA
Secondary data was collected from books, journals, magazines and articles. For this project
data was collected from articles.
The time taken in order to conduct a survey was two weeks from 15th October 2016 to 1st
November 2016.
3.6 NEED OF THE STUDY
The survey was conducted to know the impact of consumer buying behaviour in retail outlets.
The study was conducted to conclude if the preference of consumer changes time to time.
Convenient sampling was considered since each member of the population has the chance of
being selected as subject based on convenience. The entire process of sampling was done in a
single step with each subject selected independently of the other members of the population.
Responses from the customers were different during weekdays and weekends
The findings were based on the information given by the customers and can be biased.
CHAPTER-IV
TABLE 1:
RETAIL OUTLETS
35%
30%
25%
20%
15%
10%
5%
0%
BIG BAZAR LIFESTYLES MORE RELIANCE PANTALOONS OTHERS
TRENDS
NO.OF PEOPLE
From the above study, it shows that many customers prefer big bazar over other retail outlets.
More is almost close to big bazar due to availability of stores in rural areas too.
TABLE 2:
Chart Title
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
GROCERY COSMETICS BEVERAGE&SNACKS
People prefer to buy grocery at least once in a month because there not perishable goods.
NO.OF PEOPLE
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
ONCE 2-3 TIMES 4-5 TIMES MORE THAN 5
NO.OF PEOPLE
From the above study, most of the people prefer to purchase more than 2-3 times in a month
from a retail outlet. More than 46 people purchase at least 2-3 times in a month
TABLE 4:
NO.OF PEOPLE
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
BRAND VARIETY LOCATION TIME SAVING SERVICES
NO.OF PEOPLE
From the above study, the priority of the people is based on location and brand variety. More
than 76 people prefer on basis of these facilities.
TABLE 5:
NO.OF PEOPLE
70%
60%
50%
40%
30%
20%
10%
0%
YES NO
NO.OF PEOPLE
From the above study, it shows that more than half people are not member of any retail outlets
only 40% people are the member of retail outlets.
B) IF YES, THEN WHY TO CHOOSE TO BE ITS MEMBER?
NO.OF PEOPLE
60%
50%
40%
30%
20%
10%
0%
EXTRA SERVICES SPECIAL DISCOUNTS OTHERS
NO.OF PEOPLE
From the above study, out of 40 people 22 people choose for special discounts and 16 people
choose for extra services provided by the retail outlets.
TABLE 6:
NO.OF PEOPLE
80%
70%
60%
50%
40%
30%
20%
10%
0%
YES EQUAL NO
NO.OF PEOPLE
From the above study, it shows that 70 people says that price of organised retail stores are equal
to other stores. 22 people says that price of organised retail stores are less than other stores
TABLE 7:
WHEN DO YOU PREFER THE MOST TO VISIT RETAIL OUTLETS?
NO.OF PEOPLE
60%
50%
40%
30%
20%
10%
0%
WHEN THERE IS FRESH WHEN THERE IS WEEKEND OUTINGS ANYTIME
STOCK DICOUNTS
NO.OF PEOPLE
From the above study, it shows that 56 respondents visit the retail outlets when there is fresh
stock and 26 respondents visit when there are special discounts for the product.13 respondents
visit during weekend outings and 5 respondents visit anytime.
TABLE 8:
NO.OF PEOPLE
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
BELOW RS.1000 RS.1000-RS.1500 RS.1500-RS.3000 ABOVE RS.3000
NO.OF PEOPLE
In this 44 respondents told that they purchase between 1000-1500 Rs. at one time.26
respondents told that they spent 1500-3000 at one time purchase at organized retail outlets.14
said that they spent more than 3000 at one purchase, while 16 said that they purchase below
INR1000 on an average purchase at organized retail outlets.
TABLE 9:
NO.OF PEOPLE
40%
35%
30%
25%
20%
15%
10%
5%
0%
STRONGLY DISAGREE DISAGREE NEUTRAL AGREE STRONGLY AGREE
NO.OF PEOPLE
In this 35 respondents told that they will spend more at organized more at organized retail
outlets, 33 were not sure about it,12 said definitely purchase more from organized retail outlets.
Only16 respondent said that they dont want to spend more at organized retail outlets.
TABLE 10:
WHAT ARE THE PROBLEMS YOU FACED WHEN YOU SHOP FROM THESE RETAIL
OUTLETS?
NO.OF PEOPLE
60%
50%
40%
30%
20%
10%
0%
LONG QUEUE NEED HOME DELIVERY NEED CREDIT FACILITY ANY OTHER
NO.OF PEOPLE
From the above study, in this maximum number of respondents said that they faced the
problems at billing counters due to long queue. In this 54 respondents told that billing counters
are insufficient while 34 said that they need free home delivery, 8 need goods on credit while
remaining 4 said that the range is not complete.
TABLE 11:
NO.OF PEOPLE
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
DEFINITELY INCREASE REMAINS SAME DECREASE DEFINITELY
INCREASE DECREASE
NO.OF PEOPLE
From the above study, most of the respondents replied that market share of unorganized retail
will definitely decrease. In this 46 respondents said that market share of unorganized share will
decrease while 22 said that it will definitely decrease and 15 said that it will remain same. Only
16 respondents said that it may increase.
TABLE 12:
NO.OF PEOPLE
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Food products Clothing Fruits & vegetables Cosmetics
NO.OF PEOPLE
From the above study, 41 respondents said that they spend their expenditure more on food
product. 30 respondents said that they spend their expenditure more on clothing. 23 respondents
said that they spend their expenditure more on fruits & vegetables and only 6 people spent on
cosmetics.
CHAPTER-V
FINDINGS
It shows that many customers prefer big bazar over other retail outlets. More is almost
close to big bazar due to availability of stores in rural areas too.
People prefer to buy grocery at least once in a month because there not perishable
goods. People prefer to buy cosmetic mostly once in a week especially womens. People
prefer to buy beverage & snacks once in a week.
Most of the people prefer to purchase more than 2-3 times in a month from a retail
outlet. More than 46 people purchase at least 2-3 times in a month.
The priority of the people is based on location and brand variety. More than 76 people
prefer on basis of these facilities.
More than half people are not member of any retail outlets only 40% people are the
member of retail outlets. Out of 40 people 22 people choose for special discounts and
16 people choose for extra services provided by the retail outlets.
From the above study, it shows that 70 people says that price of organised retail stores
are equal to other stores. 22 people says that price of organised retail stores are less than
other stores.
56 respondents visit the retail outlets when there is fresh stock and 26 respondents visit
when there are special discounts for the product.13 respondents visit during weekend
outings and 5 respondents visit anytime.
44 respondents told that they purchase between 1000-1500 Rs. At one time.26
respondents told that they spent 1500-3000 at one time purchase at organized retail
outlets.14 said that they spent more than 3000 at one purchase, while 16 said that they
purchase below INR1000 on an average purchase at organized retail outlets.
35 respondents told that they will spend more at organized more at organized retail
outlets, 33 were not sure about it,12 said definitely purchase more from organized retail
outlets. Only 16 respondents said that they dont want to spend more at organized retail
outlets.
Maximum number of respondents said that they faced the problems at billing counters
due to long queue. In this 54 respondents told that billing counters are insufficient while
34 said that they need free home delivery, 8 need goods on credit while remaining 4
said that the range is not complete.
Most of the respondents replied that market share of unorganized retail will definitely
decrease. In this 46 respondents said that market share of unorganized share will
decrease while 22 said that it will definitely decrease and 15 said that it will remain
same. Only 16 respondents said that it may increase.
41 respondents said that they spend their expenditure more on food product. 30
respondents said that they spend their expenditure more on clothing. 23 respondents
said that they spend their expenditure more on fruits & vegetables and only 6 people
spent on cosmetics.
CHAPTER-VI
SUGGESTIONS
RECOMMENDATIONS
As per survey conducted most of the people came to know about organized store
because of print media so companies must put more emphasis on this channel of
communication and promotion means print media
As customer prefer to buy from organized store firstly due to location so companies
must open its store at convenience location, then customer prefer quality so companies
must put only quality products inside the store
As customer prefer to buy Fruits and Vegetables on daily basis, grocery items on
monthly basis, cosmetics items on monthly basis, Beverages and snacks on weekly
basis and Ready to eat food on monthly basis and people prefer to buy products
whenever they required so companies must put all the items in shelves every time
CHAPTER-VII
CONCLUSION
REFERENCE
Goldman A (2001) The Transfer of retail formats into developing countries: The example of
China, Journal of Retailing, 77, pp. 221-242.
Anand K.S. and Sinha P.K. (2009) Store format, choice in an evolving market: role of affect
cognition and involvement. International Review of Retail, Distribution and Consumer
Research, 19(5), pp. 505534.
Block Lauren G. and Morwitz Vicki G. (1999) Shopping lists as an External Memory Aid for
Grocery Shopping: Influence on List Writing and List Fulfilment. Journal of Consumer
Psychology 8(4), pp. 343-75.
Yoon K. and Tran T.V. (2011) "Capturing consumer heterogeneity in loyalty evolution
patterns", Management Research Review, Vol. 34 Iss: 6, pp. 649 662.
Divett M., Crittenden N. and Henderson R. (2003) Actively influencing consumer loyalty,
Journal of Consumer Marketing, Vol. 20 No.2, p.109.
Odin Y. and Valette Florence P (2001) Conceptual and Operational Aspects of Brand Loyalty
an Empirical Investigation, Journal of Business Research, 53, pp. 75-84.
Keller K.L. (2001) Building Customer-Based Brand Equity. Marketing Management. 10(2),
pp. 14-19.
BIBLIOGRAPHY
http://www.indiainbusiness.nic.in/economy/retail.htm
http://www.indiaretailbiz.com/blog/2008/04/17/wal-mart-backed-bharti-entersretail-
with-debut-of-every-day-chain-in-india-launches-3-convenience-stores-inludhiana/
http://www.economicstimes.com/
http://www.bigbazaar.com/
http://www.retailindustry.about.com/
http://www.hindubusinessline.com/
www.Google.com
www.ril.com
www.reliancefresh.info
ANNEXURE
QUESTIONNARIE
a) Extra services
b) Special discounts
c) Any other
6) Do you find the pricing of Organised Retail Outlets is less than other store?
a) Yes
b) Equal
c) No
7) When do you prefer the most to visit Retail Outlets?
a) When there is fresh stock
b) When there is discount
c) Weekend outings
d) Anytime
8) What is your average one time purchase at Retail Outlets in rupees?
a) Below 1000
b) 1000-3000
c) Above 3000
9) In future will you spend more at Retail Outlets?
a) Strongly disagree
b) Disagree
c) Neutral
d) Agree
e) Strongly agree
10) What are the problems you faced when you shop from these Retail Outlets?
a) Long queue
b) Need home delivery
c) Need credit facility
d) Any other
a) Definitely increase
b) Increase
c) Remains same
d) Decrease
e) Definitely decrease
12) Out of the total shopping specify percentage expenditure in the following categories at
Retail Outlets
a) Food products
b) Clothing
c) Vegetables & fruits
d) Cosmetics