European Journal of Molecular & Clinical Medicine

ISSN 2515-8260 Volume 07, Issue 07, 2020

A Study On Consumer Behaviour Towards

Passenger Car Segment With Reference To
Andhra Pradesh
Mr.B.Srikanth1, Dr.N.BinduMadhavi2
1
Research Scholar, KL Business School, KLEF
2
Assistant Professor, KL Business School, KLEF

ABSTRACT:
Study of behavior of consumers became imperative due to huge competition in all
product categories. Irrespective of size of the organization and origin understanding the
behavior of their target market became mandatory to create delighted customers and to
succeed. The automobile sector in India today is most lucrative industry. Change in the
lifestyle of Indians, increase in the income levels and some other factors like EMI facility,
offers on loans became the main driving factors of sales in car segment. Further
competition among the firms belonging to an industry in the market helps to the industry
growth. This research would be useful for the new and existing Indiancar manufacturers
to study and identify the customer expectations and their preferences from market. Indian
market influenced by many national and multinational companies. This study presents
analysis of research in the area of consumer behaviour in purchasing the cars and factors
effecting purchase decision like brand, service, price etc.

For this study, methodology adopted was to explore the purchase decision process and its
interaction with behaviour parameters. This study also attempts to present findings with
reference to study of factors influencing the purchase of Passenger cars and give
suggestions to accustom to the present scenario of sales and future demand for automobile
car market.

Key Words: Consumer Behaviour, Small cars, Sedan, Consumer perception, Consumer
buying decision process, Automobile industry.

1. INTRODUCTION
The Automobile sector in India has undergone significant transformation in the past decade.
This industry in India is to grow near about 3.62% per cent annually. Customer preferences
became complex and are undergoing rapid change due to the exposure to huge number of
information sources. So study of consumer preferences became even more imperative for
retailers today than in past. This study is conducted on consumer preferences and consumer
purchasing behaviour while purchasing the automobiles.

Marketers’ survival depends on consumer satisfaction. Consumer satisfaction depends on

their expectation and actual performance of the particular brand. In brand preference,
advertising plays a major role. In the modern highly communicated world,every individual is
influenced to some degree by advertising. Both public sector and private sector or domestic
and foreign firms have learned from their past experiences that their success is determined by
their ability to communicate effectively and efficiently with their target audiences.

6670
 European Journal of Molecular & Clinical Medicine
ISSN 2515-8260 Volume 07, Issue 07, 2020

Automobiles have become essential part in lifestyle of the people in the society. There are
number of automobile brands are available in the market. In those brands, some brands are
very famous not only in Andhra Pradesh but also globally. For the research purpose
passenger car segment has be\en selected. This is the most preferred segment of the
consumers in Andhra Pradesh.
Not lacking behind, automobile companies are also advertising their products through various
media and spending huge amount on celebrities to endorse their product. To withstand in this
heavy competition firms are using various techniques like using celebrities, investing on
research to study the pulse of target audience, investing on promotional activities etc.
Celebrities have the huge power to influence consumer’s purchase decision. So large amount
of funds are spent as the celebrity endorsement can bestow unique features upon a product
that it may have lacked otherwise. The automobile Company especially on Advertising
spends around 50-60% of the total cost. Various Movie Actors and Sports Players are hired to
endorse the brands.

2. REVIEW OF LITERATURE:
Thorough understanding of the behaviourof the target market enables a marketer to make
marketing decisions which are compatible with its consumer needs. Major determinants of
consumer behavior which have to be studied by the marketer are cultural, socio-economic,
personal and psychological. With regard to the study area ie. Automobile sector there is
enormous change in the purchase pattern of customers especially rising income has enhanced
the purchasing power and more and more people are able to afford a car. Broadening of the
target market has been observed in the recent past. Customer demands are not static, they
change with the rise in expectations and with the exposure to new information,so continuous
focus on the changesis necessary for every company to exist in the market.

Rahul Singh and Shiny Raizada (2020) explored the consumer behaviour, thinking and
usage patterns of those who have bought a mid-range priced SUV in the last 10 months
before the pandamic period or is planning to buy one in the next 10 months during the
Pandamic period. The study is focused on four major factors Media Consumption, Unaided
recall, Brand preferences and Price perception and decision making.

Tejaswi Vellampalli(2017) studied the factors influencing post purchase behaviour of

Passenger Car customers of Hyundai to understand the satisfaction level and its influencers.
The author explored the variables influencing post purchase behaviour of automobile buyers.
Kusuma P(2015)conducted study in the state of Karnataka to identify the factors that
influence the consumer buying behaviour patterns of passenger car owners. Researcher also
developed a theoretical model, which influence the consumer buying patterns of passenger
cars, so that further research could be done, based on the theoretical model developed by him.

Arpita Srivastavaand Mitu Matta (2014) explored the consumer behavior towards
passenger cars in Delhi NCR. The study focused on important behavioral aspects like
information search and evaluation, brand preference and brand loyalty and factors of
motivation. Research concluded that automobile manufacturers have to understand the factors
which enhance the level of satisfaction of customers while developing their products to meet
customer’s needs and while designing the marketing programs and strategy.

Sangeeta Gupta ( 2013) investigated the role of reference group in influencing the buying
behaviour of car owners within the city of New Delhi.. The results revealed that there is
strong correlation between theattitude of reference group towards attributes like fuel

6671
 European Journal of Molecular & Clinical Medicine
ISSN 2515-8260 Volume 07, Issue 07, 2020

efficiency, mileage, price in buying decision and buying decisions of target market.

Brown et al (2010) analyzed the consumer’s attitude towards US, European and Japanese
cars. It has been identified from the study that the country–of–origin plays a significant role
in the consumer’sbehaviour. The brand image, reasonable price and distributor’s reputation
will have a significant influence on the sale of passenger’s car.

3. Objectives
The present study is conducted with the following objectives
1. To identify the perceptions and intensions of buyers in automobile sector.
2. To examine the attributes influencing the Passenger Car buying decision.
3. To study the profile of passenger cars consumers.

4. STATEMENT OF THE PROBLEM

Consumer choice process is a complex phenomenon. Consumer buying decision with
reference to product or services involves many processes and complex it is ore complicated
for consumer durables like automobiles. The literature on brand preference studies reveals
that customer has to spend considerable amount of time to evaluate and select appropriate
brand which matches their needs and economic conditions for the selection of durable
products, especially passenger cars. The pre-conceived idea of the buyer as well as marketing
strategies followed by the manufacturer and marketer also play a vital role in selection of a
particular brand. In the region of Andhra Pradesh very limited number of attempts have been
made to study the impact of brand preference factors on customer satisfaction. Based on these
basic reasons, the present study on the factors contributing brand preference of passenger cars
and its impact on customer satisfaction level has been conducted.

5. RESEARCH METHODOLOGY
Methodology means the way the sample and the sample size is selected is of data
collection, various tools are used for studying problems with certain objects (or) objects in
view it is back bone of the study. The research design undertaken in this study is exploratory
in nature, i.e. to discover the potential opportunities. The Population for the study on
consumer perception regarding purchasing behaviour of Passenger cars is residents of Andhra
Pradesh belonging to middle and upper classes.

The questionnaire for this study was a structured questionnaire. The numbers of questions
were about 22. All the questions were asked to consumers to know their perception. The
questionnaire was designed in such a format that it was easy to get the basic Personal
information about respondent like name, e-mail address and phone number were collected.
Questions relating to Information like Preferred brands, product offering (lifestyle) and
consumer perception were also included. Sample size is190. Sample is selected through
Convenience Sampling method.

6. RESULTS & DISCUSSION

Demographic variables :

Gender Male Female

101 53% 89 47%
Marital Married Unmarried
Status 92 48% 98 52%

6672
 European Journal of Molecular & Clinical Medicine
ISSN 2515-8260 Volume 07, Issue 07, 2020

Age Below 25 26-35 36-45 46 and above

15 8% 53 28% 76 40% 46 24%

Occupation Business Govt Private Professional Others

employee Employee
62 33% 38 20% 22 12% 47 25% 21 11%

Education Diploma Graduate Post Others

Graduate
40 21% 54 28% 76 40% 20 10%

Annual Below 2.5 2.5-5 Lakhs 5-10 Lakhs More than 10

Income Lakhs Lakhs
35 18% 47 25% 75 39% 33 17%

The above table with demographic details indicates the presence of more male compared to
female and majority being unmarried. Most of them fall under the age group of 36-45 years.
Most of them are doing business and are educated. The family incomes of majority of
respondents fall under the category of 5-10 lakhs per annum.

Source of Information for Doubt Clarification

Source Number of % of respondents

respondents

Internet searching 32 17

Automobile Mechanic 48 25

Brouchure 9 5

Mail to Manufacturers 4 2

Showroom / dealer 97 51

The above analysis indicate that approx. half (51%) of the respondents consults the
showroom/dealer staff for clarification of doubts about the passenger car prior to it’s buying.
Second most important source found to be automobile mechanic (25%).

Weightages assigned to relative product attributes of Passenger car

Product Not at all Not Neutral Important Extremely

Attributes Important important important

Price 6 3.2 10 5.3 12 6.3 69 36.3 93 48.9

Design 7 3.7 16 8.4 24 12.6 71 37.4 72 37.9

6673
 European Journal of Molecular & Clinical Medicine
ISSN 2515-8260 Volume 07, Issue 07, 2020

Technology 2 1.1 13 6.8 30 15.8 70 36.8 75 39.5

Fuel
4 2.1 6 3.2 12 6.3 63 33.2 105 55.3
Efficiency

Engine power 2 1.1 6 3.2 15 7.9 87 45.8 80 42.1

Pick up 1 0.5 4 2.1 21 11.1 89 46.8 75 39.5

Warrenty 4 2.1 15 7.9 32 16.8 62 32.6 77 40.5

Colour 5 2.6 10 5.3 34 17.9 72 37.9 69 36.3

Safety 2 1.1 2 1.1 17 8.9 90 47.4 79 41.6

Internal space 21 11.1 36 18.9 17 8.9 69 36.3 47 24.7

Comfort 1 0.5 3 1.6 15 7.9 88 46.3 83 43.7

Brand Image 3 1.6 7 3.7 20 10.5 90 47.4 70 36.8

Financing
15 7.9 20 10.5 45 23.7 68 35.8 42 22.1
Schemes

Maintenance
4 2.1 12 6.3 23 12.1 86 45.3 65 34.2
Cost

Re sale Value 6 3.2 17 8.9 35 18.4 75 39.5 57 30.0

Insurance
22 11.6 16 8.4 32 16.8 50 26.3 70 36.8
Facility

Brand Image 3 1.6 7 3.7 21 11.1 95 50.0 64 33.7

The above table gives importance given by respondents towards seventeen features, which
are associated with the purchase decisions of passenger car by the target market. Five-point
scale is used to identify the emphasis given to each factor.It can be observed that there is
variation in the preference given to each factor by respondents. It can be identified that few
factors like fuel efficiency (55.3%), Price ( 48.9%), Comfort (43.7%), engine power(42.1%)
are given highest priority where as other factors like financing schemes ( 22.1%), internal
space (24.7%) are given relatively less priority in Passenger car Segment.

Analysis of Chi-Square Test Results

Ho/ Accepted/
Personal Profile Cal. Value Table Value DOF
Rejected

Age 36.5 18.3 10 Rejected

6674
 European Journal of Molecular & Clinical Medicine
ISSN 2515-8260 Volume 07, Issue 07, 2020

Gender 46.9 11.07 5 Rejected

Education 51.86 18.3 10 Rejected

Occupation 66.15 24.9 15 Rejected

Income Level 83.89 18.3 10 Rejected

The above given Chi Square Analysis indicate that Ho is rejected and so there is relation
between demographic factors like age, gender, education, occupation and income Level and
brand preference and purchase decisions of passenger car buyers.

7. FINDINGS &RECOMMENDATIONS:
The important findings of the study are summarized and suitable conclusions drawn are
presented below.
The study shows that all aged groups are well aware about brands of automobile and their
purchasing decision depends on the brand image.There is an impact of income of the
customers, which is directly proportional to the price of the car. Purchasing decisions of
individuals depends on their family members.Price is a key element, which shows high
impact on the automobile customers.Customers are giving priority to the offers and
benefits while taking the purchase decision. Customers are more concerned about family
needs while taking the decision to purchase a car. Fuel efficiency is another important
factor of concern for the customer who is planning to purchase the car.Buying decision
also depends on the Price of the car.Comfort and engine power are other two important
areas customer is giving importance with regard to their automobile purchase decisions.

8. SUGGESTIONS:
 Since all aged group customers are well aware about the brands, companies should
concentrate on their brand value in the market.
 Indian consumers are price sensitive. So, companies should be aware of the pricing
strategies
 Advertisementshave very high impact on all members of the family. so, while
creating the advertisement, companies should focus upon the preferences of target
market.
 Indian consumer purchases products when they feel they are getting something
additional to the product. So companies should follow effective offer strategies..
 Companies should implement schemes in terms of Maintenance to attract the
customers who has more concern about Maintenance.
 Organizations should maintain safety and comfort features which are recommended
by the government and SIAM(Society for Indian Automobile Manufacturers).

9. CONCLUSION
According to this study, most of the respondents are well aware of the automobile sector. In
automobile industry brand is an important element. Companies always try to keep their brand

6675
 European Journal of Molecular & Clinical Medicine
ISSN 2515-8260 Volume 07, Issue 07, 2020

strong in the market. Another impact element is price, since Indian consumers are price
sensitive. Companies will look forward to their pricing strategies. Indian consumers always
consider family needs. In India consumer gives priority to the family members. They
purchase a product if it satisfies the needs of the other members in a family. So, car
manufacturers should concentrate on the basic needs of a consumer. Benefits and offers are
key to attract the consumers. So, most of the companies aregiving offers in order to attract the
consumers.Indian market is fastest growing market in Asian continent. So, companies and
manufacturer should aware about the needs and requirements of the consumers also requires
a continuous evaluation of a market in order to find out the changes in customers tastes and
Preferences.

10. SCOPE FOR FUTURE RESEARCH

There is lot of potential for further research in this area. This section suggests few potential
avenues for future research, which may be pursued by researchers based on their area of
interest.

 Since this study is confined to the state of Andhra Pradesh only, the researcher may
focus on the other parts of country to generalize the findings of the study.Inter-State
comparison can be made to study the topic in a comprehensive way.
 Researcher may concentrate on marketing mix to have in depth knowledge of the
state.An examination into the financial implications of purchasing a vehicle could be
conducted across the state.
 Researcher may examine how marketing programme strategies affect consumer
perceptions for premium cars.

11. REFERENCES
[1] Rahul Singh and Shiny Raizada, ― Customer Analysis of Mid-Range Sport Utility
Vehicle in India‖ Customer analysis of SUV, Nov 2020 Vol. 23 Issue 17.
[2] Lahari Chaitanya atal, ―Patient Satisfaction towards Multi specialty Hospital- A case
study of Ramesh Hospitals, Vijayawada‖ International Journal of Business,
Management and Allied Sciences, Volume 4,Issue 3, PP 4449-4455, July-Sept 2017.
[3] Tejaswi vellampalli et al., ―Factors Influencing Post Purchase Behavior of Passenger
Car Customers of Hyundai‖ International Journal of Business, Management and
Allied Sciences, Volume 4,Issue 3, PP 4372-4377, July-Sept 2017.
[4] Ashok Reddy Thontla,” Barriers to Adopting E-commerce for SMEs in Developing
Cities: An Exploratory Study in Hyderabad‖ International Journal of Economic
Research, Vol 14, Number 18, 2017.
[5] Ashok Reddy Thontla, Adoption of Ecommerce in Indian SMEs: A Study in the State
of Telangana, International Journal of Applied Business and Economic Research , Vol
15, Number 19, 2017.
[6] Dr.VishalS.Rana ,Dr.M.A.Lokhande(2015) ―A Study of Consumer Preferences &
Attitude towards Passenger cars of Maruti Suzuki & Hyundai Motors in Marathwada
Region of Maharashtra‖Pratibha: International Journal Of Science, Spirituality,
Business And Technology (IJSSBT), Vol. 3, No. 2, June 2015 ISSN (Print) 2277—
7261
[7] Vikram Shende (2014), ―Analysis of Research in Consumer Behavior of Automobile
Passenger Car Customer‖ , International Journal of Scientific and Research
Publications, Volume 4, Issue 2, February 2014 1 ISSN 2250-3153 www.ijsrp.org

6676
 European Journal of Molecular & Clinical Medicine
ISSN 2515-8260 Volume 07, Issue 07, 2020

[8] G Arpita Srivastava1 and Mitu Matta2 (2014), ― Consumer Behavior Towards
Passengers Cars - A Study in Delhi NCR‖ Global Journal of Finance and
Management. ISSN 0975-6477 Volume 6, Number 6 (2014), pp. 589-598
[9] Adithya, H. S. (2013), ―Customer Perception and Behaviour of car Owners – an
Empirical Study in Bangalore City‖, Global Research Analysis, Vol. 2, No. 1.
[10] Saurabh (2012), ―Consumer Behaviour Towards Cars in Punjab: A Comparative
Study of Rural and Urban Consumers‖, Ph.D. dissertation submitted to Guru Nanak
Dev University, Amritsir.
[11] Menon Balakrishnan, V. P. Jagathy Raj (2012), ―Dominant Mean Percentage Score
Factors of Consumer Purchase Behaviour of Passenger Cars‖, IJRIM, Vol. 2, No. 5.
[12] Kshamta (2011), ―Study of Consumer Behaviour in Premium Car Segment of
Automobile Industry In India‖, Ph. D. dissertation submitted to C. S. J. M. University
Kanpur.
[13] Chattopadhyay, Tanmay, Dutta, Dutta, Rudrendunarayan & Sivani, Shradha (2010),
―Media Mix Elements Affecting Brand Equity: A Study of the Indian Passenger Car
Market‖, IIMB Management Review, No- 22, pp. 173-185.
[14] Sardar Gugloth and Reddi Naik.M(2010) ― Post-Purchase Decision Making Process
of Cars‖ The Indian Journal of Commerce Vol.63, No.3, July- September 2010 p. 92-
101.
[15] Goyal, B. B. & Aggarwal, Meghna (2008), ―Car Industry in India- An Analytical
Study of Factors of Importance‖, Indian Management Studies Journal, Vol-12, No. 1,
pp. 37-60.
[16] Badri Narayanan G, Pankaj Vashisht (2008), ―Determinants of Competitiveness of the
Indian Auto Industry‖, Working Paper No. 201, Indian Council for Research on
International Economic Relations.
[17] Ranawat and Tiwari (2009), ―Influence of Govt. Policies on India’s Automotive
Industry‖, March 2009, Working Paper No. 57, Hamburg University of Technology.
[18] Dr. B. Kishore Babu, N. Rajeswari and Naidu Mounika, An Empirical Study on
Consumer Green Buying Behaviour, Vijayawada, Andhra Pradesh, International
Journal of Civil Engineering and Technology,9(3), 2018, pp. 648–655
[19] B. Kishore Babu, P. Pavani, Engineering Students Perception Towards Social Media
Advertising For Social Causes, Vijayawada: An Empirical Study, International
Journal of Recent Technology and Engineering (IJRTE), Volume-7, Issue-6, March
2019, pp. 1901-07

6677