BES’S INSTITUTE OF MANAGEMENT

STUDIES AND RESEARCH

FINAL PROJECT TITLE

Study of Consumer Buying Behavior from

Churchgate to Mumbai Central regarding different
Brands of Mobile Handsets

Submitted By:

Sayed Mohammed Faiz (08)

MMS - II

Batch 2009-2011

Submitted To:

Prof. Quresh Moochhala

10th January Monday

 EXECUTIVE SUMMARY
Mobiles phones have intruded in our lives and have made their own unique stand. Once
considered as a luxury is now the thing closest to our hearts. Mobiles phones have become the
personal dairies for many. A mobile phone acts like your mother and wakes you up in the
morning; it is your reminder that keeps you updated of all your meetings and important events.
Calculator and notes section has made the mobile phone your personal assistant. Mobile phones
because of their varied multi-function capabilities have replaced many other devices. When you
are stressed and need some music to soothe your soul then just turning on your music player on
your mobile will work for you. We cannot imagine our lives without cell phones. Wherever we
go, we have to carry our cell phones as we need to stay connected to the rest of the world
because our jobs and social lives demand it. We make calls, we text, we send videos; we stay up
late talking over cell phones and connecting with our near and dear ones.

There are number of companies offering various technologically advanced mobiles phones like
Nokia Samsung LG, Sony Ericson, Motorola , Micromax Mobile , Lava mobile , Lemon mobile
etc.There are different variants of mobile technology we have today which has became the vital
part of our life today. THEY ARE AS FOLLOWS

GSM - (Global System for Mobile Communications: originally from Group Special Mobile)
GSM (Global System for Mobile communication) is a digital mobile telephony system that is
widely used in Europe and other parts of the world. GSM uses a variation of time division
multiple access (TDMA) and is the most widely used of the three digital wireless telephony
technologies (TDMA, GSM, and CDMA). GSM digitizes and compresses data, then sends it
down a channel with two other streams of user data, each in its own time slot. It operates at
either the 900 MHz or 1800 MHz frequency band.

CDMA - Code division multiple access (CDMA) is a channel access method used by various
radio communication technologies. One of the basic concepts in data communication is the idea
of allowing several transmitters to send information simultaneously over a single communication
channel. CDMA employs spread-spectrum technology and a special coding scheme (where each
transmitter is assigned a code) to allow multiple users to be multiplexed over the same physical
channel. Some of the company uses this technology are reliance and Tata

SMART PHONE - A Smartphone is a mobile phone that offers more advanced computing
ability and connectivity than a contemporary basic feature phone Smartphone and feature phones
may be thought of as handheld computers integrated within a mobile telephone

The importance of cell phones goes way beyond the ability to make or receive phone calls.
Today's technically advanced cell phones can perform as many or even more tasks than a home
computer. They are capable of internet access, sending and receiving photos and files, storing
data, to name just a few of the available options. So a question arises as to why different people
choose different brands and what are the features they look for while purchasing a mobile
handset.

As consumer behavior is very complex and difficult to understand and this

research can be carried out on macro level. Since the survey is conducted only in specific region
of Mumbai due to time constraint it may not have the similar findings compared to others parts
of the country. The data provided by the respondents whom on which survey is conducted may
or may not be 100 % accurate and reliable since it doesn’t have any certification. Several
difficulties will occur in conducting the research due to respondent’s busy schedule, their attitude
towards research and their level of interest in co- operation in research

As study is undertaken among the mobile phone user From Mumbai central to churchgate area in
Mumbai. It provides a scope to understand the consumers buying behavior towards the mobile
handsets. The increasing importance of cell phones has made them almost a necessity for most
people. Mobile penetration is on rise. It has even exceeded landline connections. Since various
brands of mobile phones are in the market for quite a long time, their performance provides
sufficient data for study. The results of the study would give the mobile manufacturing
companies an insight about the preferences of the consumers and also their expectations from the
mobile phones. This would help the companies to understand the potential of the market and
target the right consumers.
CONTEXTUAL BACKGROUND OF INDUSTRY / PRODUCT

Current scenario

Mobile phones have gained a lot of popularity and are the considered to be great multimedia
tools. Mobile phones are being used for entertainment purposes due the introduction of new
features every day. They have become more than just call making and receiving devices. Mobile
phone handsets now have more business-friendly applications that can enhance anybody’s
business. With emerging technology, mobile phones have become more than communication
devices; they are the tools to stay ahead of competitors and peers in the present times. Soon
mobile phones will evolve from communication tools to integrated communication devices,
media terminals, credit cards, and remote controls.

Global mobile handset market

The phenomenal rise of the mobile phone has seen its image change from a yuppie status symbol
to a daily essential. Along the way, it has created thousands of jobs, changed the way we do
business, and made an awful lot of money for investors. Today Key Handset technologies
include GSM, CDMA, and 1xEV-DO, Wi-Fi VoIP, TDMA, 3G, 4G and Blue Tooth. Worldwide
mobile phone sales cruise to 990.8 million units in 2006, up a hefty 21.3% from 2005’s 816.6
million units. The estimated growth figures are—6.4% in 2007, 4.8% in 2008 and 2.6% in 2009.
Notwithstanding the gradual decline in the growth figures, the annual handset sales are predicted
to reach more than US $ 3 Billion by 2009.The total number of mobile phone subscribers in the
world was estimated at 2.14 billion in 2005.

Source - Mike Slocombe on 5 March 2007 at 6:17 pm

Read more: http://digital-lifestyles.info/2007/03/05/worldwide-mobile-phone-sales-grow-21-in-

2006/#ixzz18dWiSqVN
Major Global Players

Table: showing market share of major global players of mobile phones in 2009

Company 2009 Market Share (%)

Nokia 38

Samsung 20

LG 10

Sony Ericsson 5

Motorola 5

ZTE 4.5

Kyocera 4

Others 13.5

Total 100.0

Source – Communities dominate brand (the blog of the book by tomi t. ahonen + Alan Moore.)
http://communities-dominate.blogs.com/brands/2010/02/phone-market-shares-for-year-of-2009-
and-last-quarter-2009.html

Nokia Corporation is currently the world's largest manufacturer of mobile telephones. It

produces mobile phones for every major market and protocol, including GSM, CDMA, and W-
CDMA (UMTS).The corporation also produces telecommunications network equipment for
applications such as mobile and fixed-line voice telephony, ISDN, broadband access, voice over
IP, and wireless LAN.

Nokia's Mobile Phones division provides the general public with mobile voice and data products
across a wide range of mobile devices. The division aims to target primarily high-volume
category sales of mobile phones and devices, with consumers being the most important customer
segment. Nokia believes that design, brand, ease of use and price are mainstream mobile phones'
most important considerations to customers. Nokia's product portfolio includes camera phones
with features such as megapixel cameras which appeal to the mass market.

Motorola is an American multinational communications company based in Schaumburg,

Illinois, a Chicago suburb. Most of Motorola's products have been radio-related, starting with a
battery eliminator for radios, through the first walkie-talkie in the world, defense electronics,
cellular infrastructure equipment, and mobile phone manufacturing. Motorola has recently been
regaining market share in the cellular-phone business from Nokia, Samsung, and others due to
stylish new cellular phone designs.

Samsung Electronics is one of the world's largest IT companies by revenue. The company also
claims to be having the highest brand value among consumer electronics companies.
Headquartered in Seoul, South Korea, it is part of the Korean Samsung Group, operating in
approximately over 100 countries. It is the number 1 mobile phone manufacturer in Asia.

Sony Ericsson is a joint venture established in 2001 by the Japanese consumer electronics
company Sony Corporation and the Swedish telecommunications company Ericsson to make
mobile phones. Both companies have stopped making their own mobile phones. The reason for
this merger is to combine Sony's consumer electronics expertise with Ericsson's technological
leadership in the communications sector. The company's global management is based in
Hammersmith, London. It also has research & development teams in Sweden, Japan, China,
Canada, the Netherlands, the States, India and the United Kingdom.

LG Electronics is one of the world's leading electronics companies. It is part of the Korean LG
Group, operating in approximately 80 countries. Its mobile phones division provides CDMA,
GSM, 3G Handsets.

Mobile Handset Market in India

The cell phones industry has shown a remarkable growth in the last decade. In 1989 the number
of its subscribers was zero in India. India’s love affair with cell phones started in the mid-1990s,
as the mobile revolution took hold and India had just 10 million mobile and landline connections.
Delhi was the first state to launch cell phones in India. Growth then soared in the last four years
due to regulatory change and falling costs of calls and handsets. India’s wireless market is a test
bed for alternative infrastructure, handsets, billing systems, business models and marketing
strategies that will likely prove applicable to other developing countries.

On a numerical basis, India is the biggest growth market adding about 6 million cell phones every month.
CAGR for mobile phones is 86% in India. It is one of the fastest growing mobile markets in the world; in
April 2006 mobile subscriber base crossed 100 million marks. This has been accomplished by rethinking
handsets, network infrastructure, enhanced services and content. More than two-third of mobile
subscriptions are with GSM operators and rest with CDMA. India has one of the lowest mobile phone
tariffs in the world resulting in low Average Revenue per User (ARPU) of 9.04 USD per year (CDMA
5.74 USD and GSM 8.89 USD).

Indian land area covered by mobile networks is approx 30%. CAGR of Mobile Market Value for 2004-
2009 is 36.9%.With 156.31 million cell phones; teledensity in the country is still low at 17.45%. Fewer
than eight in every 100 Indians use mobiles, compared with China's 30 per cent. In India, about 13
percent of people have cell phones which have increased from 8% in 2005 and are expected to reach 40
percent within a few years. A lack of investment in the infrastructure needed to support landline services
means there are only 50 million fixed-line users in the country, leaving the stage set for mobile operators.
India is expected to have the third largest mobile user base, behind China and the US, by the year end and
will become the second largest market of mobile handsets by 2010. Indian cellular market would account

for 11% of the overall Asia Pacific and Japan market by 2009 and is expected to reach 500 million
subscribers by end of 2010 with CAGR of 33.7% for 2004- 2010.

Source - http://www.dailyindia.com/show/121503.php/India-to-be-second-largest-mobile-
market-by-2010:-Nokia

India’s mobile subscriber base

Source - Zinnov research and consulting http://www.zinnov.com/presentation/Mobile_VAS.pdf

Major players in India The major players in the handsets segment in India include Nokia,
Motorola, Sony Ericsson, Samsung, LG, Philips, Panasonic, Bird, Sagem and BenQ. Nokia has retained
the top slot in Indian market with 70 % share, while US giant Motorola has 15 % share and Sony Ericsson
has gained around 8% share this year. Samsung has 5% share and LG has 1.8% share.

SOURCE -http://communities-dominate.blogs.com/brands/2010/02/phone-market-shares-
for-year-of-2009-and-last-quarter-2009.html

RESEARCH OBJECTIVES
Objectives of the study are:

1. To examine the factors that influences the customer buying choice while purchasing a
mobile handset.
2. To know which features in a particular brand in mobile handset are preferred by the
potential customer and existing customer
3. To understand the buying behavior of customer while taking the purchase decision of
mobile handset
4. What are the factors that makes customer switching of brand in mobile handset?
5. What makes the consumer attract to any particular brand while purchasing mobile
handset?

HYPOTHESIS AND TESTING

RESEARCH QUESTION 1 – Who influences the most while taking the purchase decision?

Hypothesis 1 –

H0 – 50 % of people are influenced by friends and family while purchasing a mobile handset

H1 – less than 50 % of people are influenced by friends and family while purchasing a mobile
handset

RESEARCH QUESTION 2 – what are most important factor for a consumer while taking a
purchase decision

Hypothesis 2 –

H0- 50 % of the target population consider cost and features as important factors while
purchasing a mobile handset

H1- less than 50 %of the target population consider price and features as important factors while
purchasing a mobile handset

RESEARCH METHODOLOGY
This chapter describes the research methodology adopted to achieve the objectives of the study.
It includes the scope of the study, research design, and collection of data.

Scope of the study

The scope of the study is to get the first hand knowledge about the buying behavior of
consumers towards different brands of mobile handsets residing and tend to buy in between from
churchgate to Mumbai central. The scope is restricted to study the factors affecting the
preference of consumers while choosing a mobile handset buyer from this is done to avoid
perceptual bias and for providing objectivity to the study.

Research Design

The research design constitutes the blueprint for the collection, measurement and analysis
of data. It is the strategy for a study and the plan by which the strategy is to be carried out.

The research design of the project is descriptive as it describes data and characteristics associated
with the population using mobile phones. Descriptive research is used to obtain information
concerning the current status of the phenomena to describe "what exists" with respect to
variables in a given situation.

Swot analysis of the project

Strength – Today when mobile has became an integral part of the our life its very important to
understand the factor which effects the buying decision of potential and existing customer .this
project will be very useful for the mobile manufacturing companies in their product development
process. This will enable them to prepare a strong marketing plan and to reach their target market

Weakness – as this project involve questionnaire and customer are supposed to fill this. In
today's fast life many customer may not feel to give their point of view as its not providing
anything to them in return of their time . Data may not be 100 % reliable and accurate as many
respondents may have given data in hurry. Also data is not coming from any recognized and
authentic source .we cannot consider this data on micro level as it may contain certain error

Opportunity – there are tremendous opportunity from this project to mobile company as this
report contain the factors which are very much vital for the company to understand for their
product positioning, and the strategy for growth and prosperity

Threat – There are not much threat from this report except for data reliability and their findings

Advantages of the project

Mobile phone markets are one of the most turbulent market environments today due to increased
competition and change. Thus, it is of growing concern to look at consumer buying decision process and
cast light on the factors that finally determine consumer choices between different mobile phone
brands. On this basis, this project deals with consumers’ choice criteria in mobile phone markets by
studying factors that affect the purchase decision drastically for mobile handset

How we will go on to do the research?

For determining the factors which affect the consumer buying behavior regarding brand preference of
mobile handset we have prepared a questionnaire which contains open-ended question including
various parameters which may affect consumer purchase decision. This will be filled by approx 800 – 900
respondent across churchgate to Mumbai central . Then the findings will be carried out as per the
observation

Pitfalls of the project - Although sincere efforts have been made to collect authentic and
reliable information from respondents, however the report is subject to following limitations :

i. Some respondents were reluctant to give the information, so their responses may be
biased.
 ii. Sample may not be the true representative of the universe.
iii. Study was conducted among the mobile phone user From Mumbai central to church gate
area in Mumbai. So the results of the study may not be applicable in other areas.
iv. Time could be a major limitation as it may have affected the inferences drawn in the
study. At the same time respondent may not provide the accurate and reliable data due to
their busy schedule

Sampling Types Methods & Data Sources -

Primary Data

Primary data is that data which is collected for the first time. It is original in nature in the
shape of raw material. For the purpose of collection of primary data, a well structured
questionnaire will be framed which will filled by the respondents. The questionnaire comprises
of close ended as well as open ended questions. In close ended questions dichotomous, ranking,
checklist questions and multiple choice questions are used.

Secondary Data

Secondary data is the data which is already collected by someone. They are secondary
in nature and are in shape of finished product. Secondary data will be collected so as to have
accurate results. Required data will be collected from various books, magazines, journals and
internet.

Sampling Design

Sampling refers to selecting some of the elements in a population by which one can draw
conclusions about the entire population.

Universe
Universe is the infinite number of elements which the researcher is targeting in his study. Since
the study is restricted to people who tend to buy mobile phones only the universe for the study
consists of all the mobile phone owners between churchgate to Mumbai central

Population

Population is finite number of elements which the researcher is going to target in particular area.
The entire mobile phone user form churchgate to Mumbai central Mumbai. The population for
the study would be around 900

Sampling Unit

Those units that qualify to be sampled and are available during the sampling process to be selected.
Sampling Unit is the single unit of the population. A single individual who owns a mobile phone
and residing or tend to purchase mobile phone from churchgate to Mumbai central form the
sampling unit of the study.

Extent

Extent refers to the geographical area where there is a scope of population. The extent of the
study is churchgate to Mumbai central.

Sampling Technique

The selection of the respondents will be done on the basis of convenience technique based on
the non probability method of sampling.

Sample size

Sample size is the size of sample drawn from the population which is the true representative of
the research. The number of respondents included in the study is 900 for convenience in
evaluating and analyzing the data due to time constraint.

LITERATURWE REVIEW
 1. Struggling mobile phone manufacturer Motorola Inc. (NYSE: MOT) will split itself into
two separate entities in January 2011. Previously, Motorola expected the split to be
completed in the first quarter of 2011.

Motorola sold most of its telecom infrastructure businesses to Nokia Siemens Networks, a 50-50
joint venture between Nokia Corp. (NYSE: NOK) and Siemens AG (NYSE: SI), for $1.35
billion, which will help Nokia Siemens strengthen its network infrastructure business in the U.S.
CDMA market.

Motorola also introduced 22 new smartphones in the last quarter, namely, Bravo, Citrus,
Defy, Droid Pro, Flipout, Flipside and Spice. All the devices are targeted at cost-
conscious customers
Publication title:Business Wire. New York: Nov 17, 2010

I think

2. Reliance Communications (RCOM), which became the second private telecom player
after Tata Docomo to launch its 3G services on Monday, says it will not look at predatory
pricing to popularize 3G. Analysts say other operators such as Bharti Airtel, Vodafone
will follow suit.
Service providers will also look to bundle handsets to get consumers on to 3G. "We want
to offer varied plans to our consumers but the tariff for 3G services will be a little
expensive because of the investments that have gone behind it," says Gurdeep Singh,
COO, Aircel

Publication title:McClatchy - Tribune Business News. Washington: Dec 15, 2010

I think

3. Why are the most popular smartphones so closely aligned in price? In the words of Verizon
Wireless spokesperson Ken Muche: "It's a very competitive landscape." Wireless providers see
an enormous amount of money to be made from selling high-profit-margin services such as
wireless broadband and text messaging to smartphone users. Analysts say that sales of services
for the immensely popular iPhone have almost single-handedly buoyed AT&T's wireless business
for the past two years. Because of that profit potential - and with more and more first-time
smartphone buyers entering the market competition to sell smartphones and related services is
intense
Publication title:PC World. San Francisco: Oct 2009. Vol. 27, Iss. 10;  pg. 33, 2 pgs

I think

4. Alex Marks, head of business marketing international, Ebay Advertising

Brands do need to take note that customer behaviour online does differ according to the item
being bought. Our recent research into the purchase behaviour of online buyers found that
consumer purchase of mobile handset are very much about the brand

This comprises many things, of which service is arguably the most important element, but
selection of goods, trust and familiarity are just as significant. If, however, your goods are
more price led, infrequently purchased or require a more rational decision-making process,
then a focus on your discoverability through search is more important.

Publication title:New Media Age. London: Apr 15, 2010.  pg. 15

I think

5. The brand choice and buying behaviour developed by consumers is a complex

phenomenon. The variables that influence it are numerous and it is necessary to know
them to act and develop useful strategies that achieve the objectives aimed at in each
case. The influence of prices on this process is very important. Specifically through the
present work we have tried to offer evidence on its relevance.
Since one of the most widely used techniques of sales promotion are immediate
discounts, we have considered it necessary to clarify the effects this may produce.
Interesting results have been obtained regarding this issue. Discounts are perceived as
attractive and serve to modify consumer preferences, but depending on the category of
product. Thus, for those in which consumers show a strong tendency or preference for the
brand, the expected results are not obtained, because they are not relevant in the brand
decision process.

Publication title:Asia Pacific Journal of Marketing and

Logistics. Patrington: 2008. Vol. 20, Iss. 1;  pg. 23

I think

6. Students leant about cellular phone from many sources, mainly from friends and families,
through advertisement and from their own experience. Whether a promotion and advertising
hurt or help a brand is under-researched (Mela, Gupta & Lehman, 1997). In the long-run,
advertisement help brands by making consumer less price sensitive and more loyal.
 I think

7. Exposure of an ad is crucial to be effective in changing consumer knowledge, attitude and

behaviour (Evans,Moutinho & Van Raaj, 1996). And for the ad to be seen, it must grab the
attention of its target audience.
I think
8. according to study by Biehal, Stephens and Curlo (1992) whether consumers like or dislike an ad

does not necessarily lead to brand acceptance or rejection. So, even though consumers may like

the ad that they see, it does not necessarily mean that they will go out and buy the brand

advertised.Usually the consumer uses their attitude towards the ad (Aad) in brand choice

equaled that of attitude towards the brands (AB).

I think
9. Attributes are the characteristic or features that an object may or may not have and includes
both intrinsic and extrinsic (Mowen & Minor, 1998) .Benefits is the positive outcomes that come
from the attributes.People seek products that have attributes that will solve their problems and
fulfills their needs. Mowen and Minor (1998) suggested that marketing managers should know
the attributes that consumers expect in a product and how positively or negatively they rate
these attributes to help develop and promote a successful product
10.
I think
11. Understanding why a consumer choose a product based upon its attributes helps marketers to
understand why some consumers have preferences for certain brands (Gwin & Gwin, 2003). In
the study by Gwin and Gwin (2003), the Lancaster model of consumer demand (1966, 1979),
also reffered to as the product attributes model,was used to evaluate brand positioning.This
model assumes that consumer choice is based on the characteristics (or attributes) of a
brand.Each product is abundle of attributes and that choice is based on maximizing
utility/satisfaction from the attritubes subject to budget constraints.
I think
12. .Unfounded product attribute relationship beliefs can mislead them into expecting something
that is not there.(Mason & Bequette, 1998). Hence if products fall short of customer
 expectataions,then dissactisfaction would result.Nevertheless, Mason and Bequette (1998) also
said that perceptions on product performance based on salient attributes are more important in
influencing the consumer purchase behaviour than actual product attribute performances
Ithink

13. Retailers need to be knowledgeable of the product attributes perceived as the most important

by each individual consumer group in order to build and maintain market share (Warrington &

Shim, 2000). It is the consumer who determines which attributes matter to them. Different

consumer groups place different importance on different attributes (Warrington & Shim,2000).It

was found that consumers categoriez as LP/SB (low product involvement/strong brand

commitment) placed greater importance on product attributes and product orientataions than

LP/WB (weak brand commitment) consumers, which placed the most importance on price.

I think

14. Hogg and Garrow (2003) found that women paid more intention about the details of the

characters of an ad when asked to analyze advertising messages. They said that this may be

explained by the fact that females have a greater tendency than men to consider external

information and information related to others. Women are ‘comprehensive processors’ who try

to gather all available information about the product.

I think

15. ‘Ads originality’ as defined from Pietes, Warlop and Wedel, (2002) were easier for customer to
remember than ordinary ads by increasing attention to it. This thus increased attention to the
brand being advertised.
I think

CONCLUSION
The Mobile phone represents the convergence instrument of the future. It has become a necessity
for many people throughout the world. The ability to keep in touch with family, business
associates, and storing data are only a few of the reasons for the increasing importance of mobile
phones. Cell phone manufacturers have produced a wide range of cell phones, which sell for
prices that range from very inexpensive to thousands of rupees.

The above findings and results reflected the preferences, expectations and satisfaction level of
mobile phones users in between churchgate to Mumbai central. The study would help the
companies in understanding the factors that influence the purchase decision of the consumers
and their expectations from the mobile handsets. The results of the study indicate that mobile
phones are no longer the status symbol for the users in between churchgate to Mumbai central.
Brand and features in a handset are preferred over their prices. People here are techno savvy and
require new innovative features in mobile phones every new day.

Since the study is restricted from churchgate to Mumbai central only this will enable us to get a
the clear view of the findings
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1- Marketing management – Philep kotler

2 -Market research – Naresh Malhotra

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