Pillais Institute of Management Studies and Research, New Panvel

Subject: Research Methodology and Fundamentals of Marketing Research

Submitted By: Group No: 6 Arjun Sreenivasan Pooja Ganhar Gaurav Maru Lokesh Oswal Raju Patowary 123 130 142 162 166

Submitted to : Prof. Farha Hassan

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Table of Contents
Sr. No 1. 2. 3. 4. 5. 6. 7. 8. 8.a 8.b 9. 10. 11. 12. Abstract Introduction Objective Scope Limitations Research Methodology Literature Review Data Analysis and Interpretation Hypotheses Data Analysis Conclusion Recommendations Reference Annexure I- Questionnaire 3 4 6 6 6 6 7 12 12 12 13 13 14 15 Topic Page No.

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Abstract
The expansion of customer loyalty is a deliberate objective for most of the companies. In many business situations, the most important part of marketing activities can be observed as the growth and maintaining repeat patronage or loyalty among the customers. The purpose of this research study is to examine the importance of youth consumers in the carbonated soft drink industry in order to build brand loyalty to maintain world market leadership. Hence this research study is focus on establishing loyalty among youth consumers. However the behaviour, purchasing decision and loyalty towards the brand is measured by comparing with worlds market leaders of Coca Cola and Pepsi youth consumers and differentiate their competitive advantage. The literature review covers all possible ways in explaining the importance of maintaining customer loyalty and also explain ways in which customer evaluate the product for their purchase decision for the long term business performance. This research also investigates the issues with the consumption of carbonated soft drinks among the youth consumers will be examined. At the same time the investigation also explains the significance of building brand loyalty within the youth consumers in the carbonated soft drink market. Finally, the study recommends how to attract the youth consumers in the carbonated soft drink industry at present and make some tentative recommendations for both Coca Cola and Pepsi Company.

Keywords: brand loyalty, carbonated drinks, youth, brand recall

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Introduction
This research study deals with the problems facing by the carbonated soft drink market in order to maintain customer loyalty among the youth targeted audience. Hence descriptive research methods are using for this research study in order to identify and obtain information on the distinguishing of a particular problems or issues facing by the carbonated soft drink industry. This method of study will helps to identify the issues or the problems facing by the carbonated soft drink market in past and present situations, meanwhile descriptive method of research study will helps to obtain the data which often collected quantitatively and the statistical techniques which helps to summarize the problems or information in order to identify the current issues in the markets. The main reason for choosing this topic is because of the current problems facing by the carbonated soft drink industry of Cola markets among the youth and young adult consumers which cause to decreases the sales of carbonated soft drink market and it may cause the declining customer loyalty among the specified age range of markets. Collecting information related to attitude, motivation and behaviour of the consumers of the students who consuming the carbonated drinks will enhance to get an understanding on consumer behaviour and marketing decision making. Developing, maintaining and retaining customer loyalty towards a firms product or services is generally to be seen as the important factor in the marketing activities. Youth customers are one of the attractive sector as it concerned as the large demographic group in most of the developed countries and it was extremely benefit the business sector to produce lot of sales in this particular sector. Moreover obtaining the relationship of young consumers in the early age of period habitually formed and other services may be cross selling over the time in deeper and it will create the people to start a relationship to the product which exists. More significantly consumers are more individualistic and todays market is being globalized. It means that the company should know that what makes the customer to take a quick decision and satisfies the customer is primary to the modern business world .Therefore Coca Cola and Pepsi always trying to keep particular differentiated target customers, for which they build different kinds of marketing strategies in order to retain the specified targeted customers. For example of diversity of
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categories are Coke Diet and Pepsi Max . Nevertheless, the youth market is segment is not homogenous in nature. When price is not an important factor to the customer, especially low involvement product of cola most consumers are make their purchases based on how they feel about the product. Meanwhile positive feelings such as happiness, love, are some of the desirable feelings of the consumer and advertisement play an important role which emotionally motivates the consumer to buy the product. The overall aim of this research study is to examine the behavioural and attitudinal loyalty among the youth consumers in the consumption of carbonated soft drinks and to analyse their influential factor for the purchase of this low involvement product and also reasons for dissatisfaction.

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Objectives:
1. To identify whether the population is brand loyal when it comes to carbonated drinks. 2. To identify the various factors contributing to their brand loyalty.

Scope:
The study covers the youth aged between 18 to 25 years in Navi Mumbai.

Limitations;
The solving of questionnaire depends upon the mood of the population. There is always limitation of time to interact about the research with the population. The research cannot be carried out across the entire population of Mumbai because of time and resource constraint. The study covers brand loyalty of youth only towards branded carbonated drinks. This study doesnt cover other beverages & thirst quenchers.

Research Methodology:
This is an Empirical study using both primary and secondary data for the research. A sample size of 50 individuals is chosen from Navi Mumbai. A questionnaire is been administered to the individuals to collect the primary data for the research. The respondents were met personally to collect the data. Microsoft Excel has been used for the data analysis. The hypotheses were tested using the Z- test analysis.

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Literature Review
Customers are less price sensitive and spend more in the product while they are loyal to the specific brand or the company. Moreover there is a primary belief among the marketers that it is cheaper to market to existing loyal consumers rather than the new ones. Consumer loyalty which means an intensive commitment with the consumers to buy the product or commitment with the product and services in the future. Therefore it is uncertain whether that a repeat purchase behaviour or retention can be fully regarded as a customer loyalty or devotion should be considered as such. For example a routine purchase of buying bread at the corner shop an act of loyalty to brand or whether it is convenience with the shop. In fact several studies has been proven that there exists a direct connection between the satisfaction and loyalty. Previous research studies examined that the satisfied customers become loyal and dissatisfied customers may move to the other seller. The primary objective of implementing ACSI (American Customer Satisfaction Index) in1984 was to explain the development of the customer loyalty. Therefore in ACSI model there are three factors which include the past experiences of the customer loyalty they are; perceived value, perceived quality and customer expectations Anderson et al. (2000).However in the ECSI (European Customer Satisfaction Index) model divided into two elements. First one is hard ware which contains the elements of the product and services and the second one is human ware which consists the customer service which means the personal behaviour and atmosphere of the environment Grnholdt et al (2000). In both of these models it is revealed that satisfaction should increase the loyalty of the consumers. When the satisfaction is low the customer will have the tendancy to exit e.g. switch to a competitor or express their complaints about the product or services Grnholdt et al (2000).Researchers have shown that 6080% of customer who defect to the competitor said that they are satisfied or very satisfied on the survey just previous to their defection Reichheld et al.(2000). Hence it is clear that there should be other factors apart from satisfaction will have an impact on the customer loyalty. Several authors have measured different aspects of loyalty. Mostly loyalty have been seen as a multidimensional construct acknowledged by different dimensions, some of which can be identified by the behaviour of the customers and other on the basis of psychological processes. Hence Rundle (2005) pointed out that that it should be measured by individualizing the attitudinal loyalty defined as a customer tendency towards a brand that include preference
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Bowen and Chen, (2001) and Butcher et al, (2001) intent to repurchase Bloemer et al. (1999), obligation and word of mouth Ganesh and al. (2000) a complaining behaviour having the positive and negative meaning of dissatisfaction response. Research has shown that the declining of retention only by a small percentage can have the advantage on the major profitability of the company Reichheld and Sasser (1990). According to Littleand Marandi (2003) a stable consumer base creates the opportunity for cross-selling and it decrease the cost of marketing. (Evans and Laskin, 1994; Mittal and Lasser1998).While explaining the positive effects of having loyal consumer base, customer loyalty is value motivated for. It is to be mentioned that while improving the quality of customer loyalty, a key issue or argument factor is that identifying the problems for the customer defection, i.e. causes for the customer disloyalty. Payne (2000). Kim, Han and Park did a immense research and from that research they analysed that the brand personality and loyalty have a link between each other. From their research they got positive support to hypothesis that the brand personality ultimately affects the brand loyalty Kim et al. (2001). People have showed that they are using the particular brand or product of a company for their self image. Tidwell and Horgan (1993).Customer satisfaction is prior to the loyalty. Customer satisfaction can be used as an indicator of future consumer purchases and the satisfied customers will have a higher probability of creating repeated purchase behaviour in time Zeithaml et al. (1996), of recommending others that to try the source of satisfaction (Reynolds and Arnold, 2000; Reynolds and Beatty,1999), and of becoming less willing to the competitors offerings Fitzell (1998). More specifically satisfaction is found to be essential influencing factor of customer loyalty(Fitzell, 1998; Fornell, 1992;Reynolds and Beatty, 1999; Sivadas and BakerPrewitt,2000;Zeithaml et al., 1996). Whereas satisfaction and customer loyalty recognized to be the most strong relationship in most of the research studies. (Anderson and Sullivan, 1993;Fornell, 1992; Rust and Zahorik, 1993; Taylorand Baker, 1994). Satisfied customers will be always thinking to be loyal to the brand or product Rowley (2005) or without considering any effect of the other variables Fornell 1992 and Oliva et al. [Link] though the massive growth of young people among the population, media is always concentrating to remain the youth target audience. The media has always a played major role in order to increase the loyalty customers. Television, radio and all other campaigns attracting the youth and marketing aims aged between 18 to 35 years of old customers. Younger consumers are very significant and vital, but the problem is if the advertisers are concentrating on youth targeted audience, they are ignoring the
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other demographically and economically vital market of target customers (Carrigan and Szmigin, 1999). Advertisers and the marketers may have ignored the past generations over 50s but they should need to formulate an idea of strategy towards this new generation customers to fit, healthy and above all approach to the older people also because the new generation young consumers may become the future older customers which will reflect on the loyalty of a product Marrin(1999). Importance of Youth market The young adult market aged between (18-24) is a vital and powerful segment of consumers to be considered as a separate section Ness et al., (2002). The young adults make up 3.6 percent of the population having a spending power of approximately 10 billion per annum within UK itself Jenkinson (2000). Zollo (1999) predicts that the young adult market in the US spend a lot of money to buy the products approximately US $100 billion a year and analyst predict that this segment will spend more by 2010 in comparison with the baby boomers according to the managers Merrill (1999). Young adults are increasingly the essential target market for the managers because of their: increasing influence in their family spending; capability to spend in the future and ability to follow the new trends in the market Zollo (1999). Young adults are found to be more concerned with the new trends compared to any other segments in the market and influential in the mass consumer movements of other segments Zollo (1999). Consumers including young adults are often influenced by a lot external factors which include self image, lifestyle and consumption pattern. Establishing the specific factors that influencing the young adults and their purchasing behaviour pattern have become a serious issues for the behavioural researchers (Martin and Bush, 2000). Previous studies have investigated how young adults learn what to consume and what influences them(Keillor et al., 1996; Moschis and Churchill, 1978).The studies which has been showed according to the social learning theory says that the consumers behaviour is affected by lot of sources such as their family values (Baltas, 1997and Feltham, 1998), financial restraints (Ness et al., 2002; Rowley, 2005; East et al., 1995),peer group influences (Feltham, 1998; Auty, 2001), self perception (Ness et al., 2002; Auty,2001), and other social influences (Feltham, 1998; Ness et al., 2002). Solomon (1994), highlighted that the teenagers will realize the influence of brand loyalty while purchasing different kinds of products in their age and influenced to buy the product during that age period. Hence the youth or teen may rely on the particular product in that particular age and keep purchasing their favourite brand on that age onwards (Hollander and German, 1992).There are
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several other important factors to be considered which has been identified by the researchers such as age, gender, lifestyle, access and purchase frequencies (Jacoby and Chesnut, 1978 and Veloutosou et al., 2004). Many of these young adults being students several researches have also found the accommodation type (Feltham, 1998 and Ness et al.,2002) and the year of study Hein (2003). Whereas ample research has been carried out reflecting upon the relative factors and their influences, according to Ganesh et al. (2000) current knowledge is not enough offering the insights to the managers for measuring the customer group and their decision makings. One of the reasons why managers may not target this particular consumer group segment is because they are thought to be less loyalty towards the brand. The other reasons include the young adults have less experience and attachment with the brands Howell (2004). Previous research (Pollay et al., 1996; Spero and Stone, 2004;Roehm and Roehm, 2004) assumes that the young adult customers are not much loyal to the brand however; these findings are relatively uncertain and creating more argument. According to Wood (2004) suggests that the finding related to the loyalty or the switching behaviour within the young adults market should be concentrate with very prudence because of this segment is very dynamic in its nature and hypothesis would miss the prosperity of their difficulty in the process of decision making. Furthermore, Ness et al. (2002) observes that young adults have the common problem of allocating of financial resources and because of this particular problem the young consumers may have more reasons to have switching behaviour between products with the aim of saving money. On the other hand Jenkinson(2000) pointed out that, young adults provide managers with a rare opportunity. During their previous life cycle young adults development of behavioural response are observed through their lives. For example this trend is well researched in the tobacco industry whereas it is observed by many researchers that the young adults will be tend to be loyal to their particular brand more than a decade once addicted (Pierce and Gilpin, 1995 and Gilpin et al., 1997).Generation Y consumers aged between (14-31) years old and mostly in this age they are ready to enter into the college about 34% of the Generation Y consumers will be aged between 18-23; and another 36% will be 24-30 years old Paul (2001). Janoff (1999) pointed out that as a college students specified in these ages, they are getting the freedom to enter into the market to consume the product by their own interests and of course will have a specific needs and objectives. According to Wolburg and Pokrywczynski (2001) the college market is one of the most massive segment in the consumer market due to its market size, attitude and behaviour to the stylish products, due to the influence
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of brand loyalty acquired in these influential years, their position as early adopters and the profitability of their life style or living standard associated with their college degree. College aged generation Y consumers having the purchasing capacity of $200 billion annually Gardyn, (2002).

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Hypotheses:

1. H0 : The youth is not loyal to any one particular branded carbonated drink. H1 : The youth is loyal to one particular branded carbonated drink.

2. H0 : Promotions doesnt affect the loyalty of youth for a branded carbonated drink. H1 : Promotions affects the loyalty of youth for a branded carbonated drink.

Data Analysis:
Z-test : A Z-test is any statistical test for which the distribution of the test statistic under the null hypothesis can be approximated by a normal distribution. Data points should be independent from each other Z-test is preferable when n is greater than 30. All individuals must be selected at random from the population . All individuals must have equal chance of being selected. Sample sizes should be as equal as possible but some differences are allowed.

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For Hypothesis 1 : Z-score : 8.55 Tabulated value : 1.96 Since the calculated value is higher than the tabulated value, we reject the null hypothesis and accept the alternate hypothesis. For Hypothesis 2 : Z-score : 28.06 Tabulated value : 1.96 Since the calculated value is higher than the tabulated value, we reject the null hypothesis and accept the alternate hypothesis.

Conclusion :
1. The youth is faithful to their favorite branded carbonated drink. 2. Promotions effects the loyalty of youth towards branded carbonated drinks.

Recommendations :
1. The companies should continue focusing on marketing activities specific to the youth 2. Companies should continue investing in various sales and promotion activities to avoid brand switching.

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References

Articles and Research Papers:

2. Abernethy, A. Television exposure: programs vs. advertising. Current Issues & Research in Advertising, 13(1), 61-77.

3. Journal of Advertising Research, (May-June ), 16-26.

Books:

1. Marketing Research- Rajendra Nargundkar (2011):, McGraw Hill Companies, Third Edition. 2. Research Methodology Methods and Techniques by C.R. Kothari 3. Business Research Methodology, Himalaya publishing house, - J. K. Sachdeva (2010): Third Edition. 4. Zikmund and Babin (2007): Marketing Research, Cengage learning, India Edition. 5. Martin Lindstorm (2005): Brand Child, Kogan Page Ltd, UK, First South Asian Edition.

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Annexure I Questionnaire
1. Your age: 18-21 2. Gender: Male Female 22-25

3. Which brand is your favorite carbonated soft drink? (Please tick only one)* Coca-cola Pepsi Sprite Thumps Up Fanta Others Please specify ___________

Please answer the following questions, for the brand you chose in Q 3. Please read the following statements and choose Only One Response that accurately reflects how strongly you agree and disagree with statements. 4. Your favorite brand is good value for money Strongly Agree Agree Neutral Disagree Strongly Disagree
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5. You might buy a different brand if it was offered at a lower price than your favorite brand Strongly Agree Agree Neutral Disagree Strongly Disagree

6. You buy a product endorsed by your favorite Celebrity Strongly Agree Agree Neutral Disagree Strongly Disagree

7. You believe in your favorite Brand Strongly Agree Agree Neutral Disagree Strongly Disagree

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8. Negative publicity about your favorite brand may affect your buying decisions the next time you buy a carbonated drink Strongly Agree Agree Neutral Disagree Strongly Disagree

9. If your favorite brands introduces a new flavor, you will make it a point to buy it the next time you have carbonated drink Strongly Agree Agree Neutral Disagree Strongly Disagree

10. If your favorite celebrity shifts to another brand, you would consider changing to that particular brand of carbonated drink Strongly Agree Agree Neutral Disagree Strongly Disagree

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11. You would search somewhere else if your favorite brand is unavailable with a particular vendor Strongly Agree Agree Neutral Disagree Strongly Disagree

12. Grade the major influencers for your purchase from 0 to 9 Friends Self Girlfriend/wife Peer group Occasion Past Experience

13. Grade the elements of Brands which influences you the most Brand name Logo/Sign/Symbol Character Slogan/Caption Package Jingles/Songs

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14. Grade your opinion of the reason that you recognize these Brands from 0 to 9. Constant coming on TV Adverts. in news papers Hoardings Presence in films Packaging Internet

15. You let someone else make some purchases on your behalf Always Often Sometimes Rarely Never

Thank You for your precious time.

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