Marketing Research Report

Marketing Research Report Important factors that determine and drive the sales of laptops/notebooks among student community

Submitted By:

Submitted to:

Group 2 – PGP (2008-10)

Dr. Sathya Priya

Specialization - Marketing Members: Harpreet Singh

08PG022

Nitin Malik

08PG039

Rochak Khanna

08PG116

Saurav Rawat

08PG126

Somyata Krishna 08PG130 Suchita Khanna

08PG054

TABLE OF CONTENTS Group 2

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Acknowledgement...................................................................................................4 1. Abstract................................................................................................................5 2. Introduction..........................................................................................................6 3. Literature Review.................................................................................................7 4. Research Problem.................................................................................................9 5. Research Objectives.............................................................................................9 6. Scope of Study.....................................................................................................9 7. Research Methodology........................................................................................9 7.1 Research Approach........................................................................................9 7.2 Research Design............................................................................................9 7.3 Data Collection.............................................................................................10 7.3.1 Primary Data.......................................................................................10 7.3.2 Contact Methods.................................................................................10 7.4 Sample Description.......................................................................................11 8. Data Analysis Strategy........................................................................................11 8.1 Coding.....................................................................................................11 8.2 Analysis Tools.........................................................................................12 8.3 Hypothesis Considered...........................................................................12 8.4 Analysis...................................................................................................12 9. Research Findings...............................................................................................17 10. Research Drawbacks.........................................................................................17 11. Conclusion.........................................................................................................17 12. Glossary….........................................................................................................18 13. Annexure...........................................................................................................19

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ACKNOWLEDGEMENT:

We the members of group 2 would like to thank Dr Sathya Priya, our Marketing Research professor, for giving us this opportunity to carry out research work. Her support and guidance helped us to make this project a success and bring out valuable findings and conclusions.

Group 2 – PGP (2008-10) Specialization - Marketing Members: Harpreet Singh Nitin Malik Rochak Khanna Saurav Rawat Somyata Krishna Suchita Khanna

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1. ABSTRACT: The one consumer group which is being successfully and consistently targeted by the laptop providers is ‘Student Group’. With technology reaching the academic field at a fast pace, laptops are intended to find a place in this market. The student community has increased the usage of laptops and it is mutually benefiting. As a student there are many factors that need to be considered before going for a final purchase of a laptop. Some prefer the machine to technologically advanced with all the latest updates while others prefer it cheap and simple. These preferences are equally important for consideration from marketer’s point of view as it gives a clear insight as what the end consumer wants and values and accordingly more emphasis can put on the features demanded by the consumer. Through this research we have made an effort to understand the prime benefits that a student as a consumer seeks from purchasing a laptop. For the same purpose a sample of fifty respondents was interviwed to know about the underlying benefits they seek from a laptop purchase. Degree of agreement with variables such as price, availability, sales promotion etc. were analysed and clubbed into factors which should considered primarily from a marketer’s point of view. The elaborations on the findings have been provided in the following report.

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2. INTRODUCTION: ‘Laptop’, also known as 'notebook computers' has become widely popular and essential for every business in the last few years in India. "Portability, rather than mobility has emerged as the `number one' driver for the sustained growth in notebook PC shipments in India. Indian Laptop market is now in sync with global market. The Laptop market is growing at a fast rate because of change in work life of consumers. As the need for "anytime anywhere" access to information is increasing, the sales of Laptops are also increasing. Given the choice of portability, flexibility and ease of use and narrowing of price-performance gap that once existed between portables and desktops, consumers are almost overwhelmingly inclined to buy notebook PCs. Other factors that are responsible for the hike in sales figure are reduction in prices and affordability. Laptops are now sold at approximately half the price at which they were sold two years ago. An increasing number of computer operators are switching to laptops for easy working. The laptop computer market in India grew by 84.8 per cent in the third quarter of 2007 against the corresponding quarter last year, contributing significantly to the overall PC market growth of 25.1 per cent. More than five lakh notebook PCs were sold in the quarter, according study by market analyst IDC India. Top three market players: Hewlett Packard (HP) with a market share of 37.8 per cent. Lenova, the second position. Acer, the third position. Notebook PC sale in home and `Small Office and Home Office' (SOHO) grew by 166 per cent and made up 43 per cent of the total business in 2007-08. The next largest contributiors were enterprise and education segments. Thus the education segment is coming up as a lucarative market for the laptops which showing an unprecedented year on year growth.

3. LITERATURE REVIEW: Group 2

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Sachin Mathew (2001), “LAPTOP – The Transformation”.

This research paper ensures that laptops are the future of the computing world. The time is coming soon when desktops will no longer be in offices and used as home computers because the tremendous benefits of laptops will become apparent to the general public and the prices will drop enough for most people to purchase them. Laptops are already gaining in popularity as employees continue to discover how much more work could be done with a portable computer. Laptops are now being made better than ever. These machines generally come ready-made with more memory and free space than your average desktop, and they usually have a faster Internet connection with the same Internet provider. Some laptops have a reputation of breaking down after a few years, but the well-made high-quality brands will run well for much longer and even the lesser brands have about the same life-span as a desktop.

Shean Thomas (2001), “Laptop Benefits – faculty’s views”.

According to previous researches by “Indiana State Laptop Program”, students and faculty indicated that there were many benefits associated with having laptop computers. The benefits had to do with convenience, enhanced communication, and in several cases, the broadening and deepening of learning or skill development. Most faculties believed that the personal laptop computers enhanced students’ ability to learn the course material and work more collaboratively. Most students agreed that faculty were using the laptops effectively to help students learn. Although some frustrations were expressed with technical and practical problems, students and faculty were able to work through most of these difficulties. Following are the advantages of laptops derived from the previous conducted research

 Productive: Laptops will allow students to become more efficient in their homework

preparation, access to electronic resources, and other research endeavors. This will increase student productivity and lead to more active learning and better retention of course materials.  Interactive: Pervasive campus computing can increase faculty-student, student-student,

and faculty-faculty communication, participation, and feedback which contribute to a greater sense of community and a more robust, active learning environment.  Supported: Technical support for hardware and software issues, including loaner

systems, is available on-campus for program-purchased systems. With the entire campus more technologically savvy, students have more places to turn to for support.

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 Empowered: Mobile computing is available anytime, anywhere. The convenience and

efficiency with which students can conduct academic, administrative, and personal activities is empowering.  Increased self-exploration—student identification of strengths and weaknesses, tracking

progress, learning a variety of presentation styles, reflecting on learning and applying learning to their experience.  Active engagement in discovering knowledge and applying skills.  Significant improvement in information technology knowledge, skills, and confidence.

 Increased time spent on higher level modeling and analysis rather than tedious low-level functions.  Integration of lecture and lab activities previously delegated to specific physical space, so that learning activities are dictated by the educational objectives rather than physical location.  Use of current, software and web-based information rather than outdated textbooks.  More efficient use of class time through use of electronic documents and anytime, anywhere resources and information.

4. RESEARCH PROBLEM: Group 2

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World is getting globalize every day and so do the competition. Various companies are competing with each other in different fields and one if the important felid compromises of the digital equipment. Laptop is one the constituent of the digital world equipments. Numerous companies are competing in the market to increase their laptop sales. In order to boost their sales, companies are considering important factors that determine and drive the sales of laptops/notebooks among student community.

5. RESEARCH OBJECTIVE: Understand the underlying benefits students seek from a laptop purchase and evaluate which of them should be considered primarily.

6. SCOPE OF STUDY: 1. It has good scope as marketers and firms can have a good knowledge about the underlying benefits consumers seek from a laptop purchase and hence be more aggressive towards tapping the growing student group market. 2. It can help new players get a better understanding of the consumer group before entering the market. 3. Study can be carried out among consumer group other than student’s community.

7. RESEARCH METHODOLOGY: 7.1 RESEARCH APPROACH: Quantitative approach i.e. use of statistical tools for quantifying the data and analyzing the data pattern.

7.2 RESEARCH DESIGN: A descriptive research design has been followed for the study. It was the most appropriate design as the need was to define the characteristics of a particular and relevant consumer group, the students in case. The functions and the characteristics here refer to the benefits seeked from a laptop purchase.

7.3 DATA COLLECTION: Group 2

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7.3.1 PRIMARY DATA: Questionnaire design  Questionnaire consisted of likert scale questions

 It took into account all the necessary aspects of the study variables

 Following study variables were included: 1. Price 2. Post purchase service 3. Additional and advanced(technological aspect) features

4. Brand 5. Design 6. Weight of the laptop

7. Sales promotions 8. Availability

7.3.2 CONTACT METHODS: The respondents were contacted directly (Personal Interviewing). It is the most versatile method. The interview was of intercept type in which respondents were asked to answer the questions on the spot. The method is time consuming but it provides better results as it involves face to face to interaction with the respondent which is missing in case of telephonic, mail and other methods of interviewing.

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7.4 SAMPLE DESCRIPTION: Sample size: 50 Sampling Frame: Alliance Business School Sampling Elements: Students of Alliance Business School Demographic variable: Gender SAMPLING TYPE: Non Probability Sampling SAMPLING METHOD: 1. Quota Sampling – Quota defined on the basis on Gender

Target for each Quota – 25 males and 25 Females

2. Convenience sampling method – as the sample consisted of student group from Alliance

itself, so the sample was easily available at hand.

8. DATA ANALYSIS STRATEGY: The analysis strategy focused on reducing the set of variables into a manageable level by determining the correlation among the set of studied variables.

8.1 CODING 

Ratings of the respondents were coded as

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1 = Strongly Disagree 2 = Disagree 3 = neither Agree or Disagree 4 = Agree 5 = Strongly Agree

The master schedule for the coded data has been provided in annexure 2

8.2 ANALYSIS TOOLS

Software:

SPSS package, Microsoft Excel

Technique used:

Factor analysis: A class of procedures primarily used for reduction and summarization of data.

8.3 HYPOTHESIS CONSIDERED:

Null Hypothesis: H0: The set of variables under consideration are not correlated

Alternative Hypothesis: H1: The set of variables under consideration are correlated

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8.4 ANALYSIS Following table gives percentage of positive responses (agreement) with the different variables, among the sample under consideration. Table 1 Variables Inexpensive Good post purchase service Advanced Features Brand Design Light weight laptop Sales promotion is secondary Ease of availability not important criterion

Percentage of positive responses 24 90 26 78 68 52 30 18

KMO and Bartlet test Bartlet test of sphercity can be used to test the null hypotheses that the variables are uncorrelated in the population in other words; the population correlation matrix is an identity matrix. The test statistic for sphercity is based on a chi-square transformation of the determinant of the correlation matrix. A large value of the test statistic will favor the rejection of the null hypothesis. Another useful statistic is the Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy. This index compares the magnitude of the observed correlation coefficients to the magnitudes of the partial correlation coefficients. Small values of the KMO statistic indicate that the correlation between pairs of variables cannot be explained by other variables and that factor analysis may not be appropriate. Table 2 and Table 3 substantiate the mentioned statistics. Group 2

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Table 2: Correlation Matrix variabl variabl variable variable variable variable variable variable e1 e2 3 4 5 6 7 8 Correlation variable1 1.000

.108

.480

.257

.103

.178

.006

-.216

variable2 .108

1.000

-.141

.229

.367

.365

-.113

-.168

variable3 .480

-.141

1.000

.048

-.057

-.081

.338

.035

variable4 .257

.229

.048

1.000

.539

.386

-.072

-.071

variable5 .103

.367

-.057

.539

1.000

.447

-.070

-.207

variable6 .178

.365

-.081

.386

.447

1.000

-.253

-.133

variable7 .006

-.113

.338

-.072

-.070

-.253

1.000

.233

variable8 -.216

-.168

.035

-.071

-.207

-.133

.233

1.000

 Now we can see from Table 2 that the population correlation matrix is not an

identity matrix and every variable is correlated with another variable.

Table 3: KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .620 Bartlett's Sphericity

Test

of Approx. Chi-Square

72.217

Df

28.000

Sig.

.000

 We can analyze from the Table 3 that the null hypothesis that the population correlation

matrix is an identity matrix is rejected by the Bartlet test of sphercity. The approximate chisquare matrix is 72.217 with 28 degree freedom which is significant at .05 levels. The value Group 2

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of KMO statistic (.620) is also large (>0.5) thus the factor analysis may be considered as the appropriate technique applied to the sample.

 Table 4 provides information regarding which components explain the most variance in the

given and hence form the basis for factors formation and thus data reduction. Table is provided on the next page.

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 Table 3: Total Variance Explained Initial Eigenvalues Rotation Sums of Squared Loadings Compo nent Total % of Variance Cumulative % Total % of Variance Cumulative % 1

2.410

30.125

30.125

2.211

27.637

27.637

2

1.628

20.347

50.472

1.596

19.947

47.584

3

1.115

13.939

64.412

1.346

16.827

64.412

4

.804

10.053

74.465

5

.737

9.207

83.671

6

.536

6.705

90.376

7

.418

5.219

95.595

8

.352

4.405

100.000

Extraction Method: Principal Component Analysis.

 We determine the number of factors based on eigen values. In this approach, only factors with eigen values greater than 1 are retained: the other factors are not included in the model. An eigen value represents the amount of variance associated with the factor. Hence, only factor with he variance greater than 1 are included. Now we can analyze from the Table3 that there are only three factors whose eigen values are greater than one. It can also be interoperated that these three extracted factors account for approximately 64%of the total variance among the sample.

 An important output from factor analysis is the Factor Matrix. The factor matrix contains the

coefficients used to express the standardized variable in terms of the factors. These coefficients, the factor loadings, represent the correlation between the factors and the variables. A coefficient with the large absolute value indicates that the factor and the variable are closely related. Table 4 provides the matrix that gives the number of factors with the respective variables contained in each variable. Degree correlation of each variable with each factor is given. Group 2

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Table 4: Rotated Component Matrix Component 1

2

3

variable1

.180

.829

-.232

variable2

.606

-.086

-.185

variable3

-.102

.847

.250

variable4

.764

.189

.083

variable5

.823

.016

-.018

variable6

.720

-.009

-.216

variable7

-.114

.305

.735

variable8

-.093

-.234

.775

Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization.

 Now after analyzing the Table 4 we have designed the following table on the basis of weights(greater than 0.6) of highly contributing variable in the respective factors and by this way we club the variables in different factors in the following manner. Factors Factor 1 Factor 2 Factor 3

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Variables V2, V4, V5, V6 V1, V3 V7, V8

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9. RESEARCH FINDINGS:  Factor 1 i.e. the set of variables post purchase service, brand, design and weight of the laptop are perceived by the consumer in the similar manner. These variables can be labeled under brand reputation and brand performance.

 The above factor contributes to the majority of the variance in the sample and hence is an important factor for consideration by the company.

 If a consumer is price sensitive and gives more weight to price, he/she will not opt for laptop with advanced technological features. These variables have been included in factor 2.

 Students who are least bothered about the ease of availability (distribution) do not give much importance to sales promotion either. These variables are included in factor 3.

 Factor 3 shows significant variance and hence company can go for brand awareness and other related activities at the cost of this factor.

10. RESEARCH DRAWBACKS: The sample for this study consisted of 50 respondents and it was confined only to Alliance Student Group, so the research has the scope to be carried out at a larger scale in various metro cities to get clearer picture of the study.

11. CONCLUSION: The research provided a good and clear insight regarding the purchase behavior of the student’s community towards laptop. Overall it can be seen that brand performance plays a major role in providing consumer with a value for money solution.

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This research just represents a tip of the iceberg and has the scope of further study. With the growing laptop market such research and the related ones can prove to be a helpful tool for the companies. Nokia, for instance is planning to enter the laptop market in India and it can go for a similar research to better position its’ product in stiff competition with the other players.

GLOSSARY: Some important terminologies used: 1. KMO Statistic – it is used to determine whether the sample is appropriate for factor analysis.

2. Bartlet’s Test For Sphericity - it is used as a criterion for accepting or rejecting NULL hypothesis.

3. Eigen Values – these values determine the candidates for factor/component formation.

4. Likert Scale – a rating scale used to determine the preference towards a statement based on degree of agreement.

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ANNEXURE I QUESTIONNAIRE Dear sir/madam, We are conducting a study that will make us better understand the underlying benefits students seek from a purchase of laptop. We will value your co-operation in filling this questionnaire for the same. Questions

Strongly agree

Agree

Neither agree nor disagree

Disagree

Strongly disagree

It is important to buy a laptop which is inexpensive I like a laptop of a company that provides good post purchase service Advanced features is not an important benefit seek by me The most important consideration in buying a laptop is brand. I prefer a laptop which is well designed and has a stylish look Light weight laptop adds to my benefit list Sales promotion is not an important benefit offered by laptop Ease of availability is Group 2

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not an important criterion in purchase of a laptop Name: Gender:

Male

Female

Thank you for giving your valuable time and information.

ANNEXURE II - CODED DATA Master Schedule for the coded data Rows represent the respondent ratings to different questions Columns represent the 8 different questions

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V1 1 2 2 4 3 3 4 2 5 2 6 2 7 4 8 3 9 2 10 2 11 3 12 2 13 2 14 3 15 3 16 3 17 2 18 4 19 4 20 4 21 2 22 4 23 3 24 2 25 3 26 2 27 2 28 2 29 5 30 2 31 2 32 2 33 1 34 3 35 2 36 4 37 4 38 2 39 2 40 4 41 2 42 2 43 4 44 2 45 2 46 3 Group 2 2 47 48 2 49 5 50 3

V2 4 5 4 3 1 4 5 4 5 5 4 4 4 5 5 5 5 4 3 3 4 5 4 5 5 4 4 4 4 5 5 5 5 5 5 5 5 4 5 4 4 2 5 4 3 5 5 2 4 5

V3 2 2 2 3 4 2 2 1 1 2 2 2 1 2 1 2 2 4 4 4 2 4 2 1 4 3 2 3 5 2 5 3 1 1 3 5 5 3 2 2 2 1 2 2 2 4 2 4 5 3

V4 4 2 3 3 4 4 4 4 5 3 4 3 4 4 4 4 4 4 3 5 4 4 5 4 5 4 4 4 4 4 4 4 3 4 4 5 4 3 4 4 3 4 5 4 4 3 4 1 5 4

V5 4 3 2 3 3 3 4 4 5 3 4 4 3 4 4 4 5 5 4 4 4 4 5 4 4 4 3 4 2 4 4 5 4 4 3 5 5 3 4 4 3 4 5 3 5 5 3 1 3 4

V6 3 4 4 4 4 4 5 4 5 4 4 4 4 5 5 5 5 4 4 4 5 4 5 4 3 4 4 4 5 4 4 5 5 4 5 4 5 2 4 3 4 4 5 4 5 5 4 2 5 5

V7 4 2 3 3 3 2 2 3 2 4 3 2 3 2 2 2 3 4 2 4 3 4 1 3 4 3 4 4 1 4 4 1 3 2 1 2 5 2 3 2 2 2 3 4 3 4 2 5 5 3

V8 2 2 2 2 2 2 2 2 2 2 3 2 4 1 1 1 1 4 2 2 2 2 2 2 1 5 4 3 2 3 3 1 3 4 5 1 3 4 3 1 2 3 2 3 4 2 3 3 4 2

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REFERENCES: Group 2

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1. In Indiana State Laptop Program. Retrieved 27th February 2008, from http://www1.indstate.edu/cirt/laptop/benefits.html

2. Tustle Margarette, In Laptop computers – Find the perfect Fit! Retrieved 27th February 2008, from http://ezinearticles.com/Laptop-Computers-Find-The-Perfect-Fit!&id=125911

3. In The Financial Express – Indian Laptop Market Grows At 85 %. Retrieved 03rd March 2008, from http://www.financialexpress.com/news/Indian-laptop-market-grows-85/250897/

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