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Laxminder Sharma
Parnita Malhotra (Lect.)

Chandigarh Business School, Landran, Mohali


I Laxminder Sharma Roll no. 1272873 do hereby declare that Research Report
IMPULSE BUYING BEHAVIOUR Submitted to Punjab Technical University,
in partial fulfilment of M.B.A. Is the result of my own work. I have not submitted
this training report to any other university for the award of degree.

Submitted To
Parinita Malhotra
Lect. (CBS)

Submitted By
Laxminder Sharma
Roll. No-1272873
























S. No.


Page No.

Sales Promotion tools and opinion response


Companys Television owed


Effectiveness of live demonstrate


Customer Education


Most suitable Media


Gift offered by various companies


Sales promotion tools


Point of purchase


Companies trade show and fair



Companies cross promotion



Level of satisfaction



Reason for satisfaction



S. No.


Page No.

Companys Television owed


Effectiveness of live demonstrate


Customer Education


Most suitable media


Gift offered by various companies


Sales promotion tools


Point of purchase


Companies trade show and fair


Companies cross promotion



Level of satisfaction



Reason for satisfaction



Retailing includes all activities involved in selling goods or services directly to final consumers
for personal, non-business use. A retailer or retail store is any business enterprise whose sales
volume comes primarily from retailing. Retail is India's largest industry, accounting for over 10
per cent of the country's GDP and around eight per cent of the employment. Retail industry in
India is at the crossroads. It has emerged as one of the most dynamic and fast paced industries
with several players entering the market.
India retail industry is the largest industry in India, with an employment of around 8% and
contributing to over 10% of the country's GDP. Retail industry in India is expected to rise 25%
yearly being driven by strong income growth, changing lifestyles, and favorable demographic
patterns. It is expected that by 2016 modern retail industry in India will be worth US$ 175- 200
billion. A further increase of 7-8% is expected in the industry of retail in India by growth in
consumerism in urban areas, rising incomes, and a steep rise in rural consumption. It has further
been predicted that the retailing industry in India will amount to US$ 21.5 billion by 2010 from
the current size of US$ 7.5 billion. Shopping in India have witnessed a revolution with the
change in the consumer buying behavior and the whole format of shopping also altering.
Industry of retail in India which have become modern can be seen from the fact that there are
multi- stored malls, huge shopping centers, and sprawling complexes which offer food,
shopping, and entertainment all under the same roof.
India retail industry is expanding itself most aggressively, as a result a great demand for real
estate is being created. Indian retailers preferred means of expansion is to expand to other
regions and to increase the number of their outlets in a city. It is expected that by 2010, India
may have 600 new shopping centers.
In the Indian retailing industry, food is the most dominating sector and is growing at a rate of 9%
annually. The branded food industry is trying to enter the India retail industry and convert Indian
consumers to branded food. Since at present 60% of the Indian grocery basket consists of nonbranded items.

India retail industry is progressing well and for this to continue retailers as well as the Indian
government will have to make a combined effort.
The presence of 15million kirana stores brings into light the very fact that the Indian retail
industry is highly fragmented/ unorganized. Retailing in India is gradually inching its way
toward becoming the next boom industry, organized retailing in particular. The whole concept of
shopping has altered in terms of format and consumer buying behavior, ushering in a revolution
in shopping in India. Modern retail has entered India as seen in sprawling shopping centers,
multi-storeyed malls and huge complexes offer shopping, entertainment and food all under one
The share of retail trade in the country's gross domestic product (GDP) was between 810 per
cent in 2007. It is currently around 12 per cent, and is likely to reach 22 per cent by 2010.
Commercial real estate services company, CB Richard Ellis' findings state that India's retail
market is currently valued at US$ 511 billion, and is poised to grow to US$ 833 billion by 2013.
The report further stated that organised retail that currently accounts for less than 5 per cent of
the total retail market is expected to register a compound annual growth rate (CAGR) of 40 per
cent and swell to US$ 107 billion by 2013.
A report by global consultancy firm, AT Kearney said "The consumer spending in India has
increased by an impressive 75 per cent in the last four years and will quadruple in the next 20
years." Moreover, India recently topped the Nielsen Global Consumer Confidence study,
conducted by Nielsen, a market research company. The biannual report revealed that Indians are
"the most optimistic lot globally who think that their country will be out of the economic
recession in the next twelve months."
According to the recent report by McKinsey & Company titled 'The Great Indian Bazaar,
Organized Retail Comes of Age in India', India's overall retail sector is likely to grow to US$ 450
billion by 2015. Another McKinsey report 'The rise of Indian Consumer Market', estimates that
the Indian consumer market is likely to grow four times by 2025.

In a joint study recently conducted by ASSOCHAM and KPMG, the following findings were

The total retail market size in India in 2008 was estimated at US$ 353 billion.

The annual growth of the retail market in India is expected to be around 8 per cent.

The total retail market size in India is likely to touch US$ 416 billion by 2010.

The present share of organized retail sector is estimated at 7 per cent.

The estimated annual growth of organized retail sector is 40 per cent.

The size of organized retail sector by 2010 is estimated to reach US$ 51 billion.

The estimated share of organized retail in total retail by 2010 is 12 per cent.

The investment into modern retailing formats over the coming 4-5 years is expected to be
around US$ 25-30 billion.

The great Indian consumer market is still going strong. The ETIG analysis carried out by the
Economic Times revealed that most mass consumer goods and service in India were not much
affected by the global economic slowdown. Despite the inflation experienced during the period,
the second-quarter results of leading 70 consumer-related firms revealed that their aggregate
revenues increased by 8.5 per cent during the September 2008 quarter over the same period in
2007. Even though this was a tad lower than the 9 per cent growth posted during the first quarter
of 2008-09, it was a lot higher than the 7 per cent registered during the previous three quarters
for these firms.

Growth Continues Apace

Despite the global economic slowdown, Indian retailers are still optimistic about the India
growth story. Speaking on the issue, Mr. Tarun Joshi, CEO and MD of Brandhouse Retails said
Fashion retail has not been impacted in a big way. Not even 0.5 per cent of the working
population has been hit in India. The Indian economy is more stable than other economies

across the world and one must not confuse India with the rest of the world, reiterated Mr.
Sandeep Kulhalli, V-P, Retail and Marketing, Tanishq.
With the 30-40 per cent drop in retail rentals, Indian retailers are a happy lot. In fact, retailers are
also foreseeing further drops in rentals in 2009 and they are optimistic about their expansion
plans for this year.
Retailers such as Spencer's Retail, Future Group, Shoppers Stop, Westside, Wills Lifestyle, Bata
India, and Raymond, have plenty of expansion plans for 2009.

The Future Group will focus on launching private labels with high profit margins in
segments like toothpaste, shampoo, and butter amongst others. According to Kishore
Biyani, MD and CEO of the Future Group, "Another thrust area will be entering into new
segments like rural retail and telecom products distribution. Through 'Aadhar' we can
ramp up rural retail, which is outside the 20 per cent of the population we have been
targeting so far."

Aggressive marketing efforts by leading retailers are on. Tanishq is planning a marketing
effort for plain gold along with the World Gold Council during the last quarter of 200809. Similarly, Brandhouse Retails is planning a joint venture with a European private
apparel label for the next financial year, along with the introduction of a few more
international brands.

In West Bengal, leading retailers like the Future Group and Spencer's Retail, are
expanding and upgrading their present stores in 2009. Others like Wills Lifestyle, Turtle
Ltd, and Bisk Farm, are planning to set up new stores, particularly in the suburbs.

Auto company Mahindra & Mahindra (M&M) has made a quiet foray into the retail
sector with the soft launch of its specialty format Mom & Me to sell infant care and
maternity products. The company has launched two outlets in Ludhiana and Ahmedabad.

India has one of the largest number of retail outlets in the world. A report by Images Retail
estimates the number of operational malls to grow more than two-fold, to cross 412, with 205
million square feet by 2010, and a further 715 malls to be added by 2015, with major retail
developments even in tier-II and tier-III cities in India.

Even as the organized retail market is starting to take off, there is an associated surge in branded
discount outlets in India. Top realtors and local retail chains are developing malls in regional
boroughs, specifically to sell premium branded goods.

Rural Retail
Led by the rising purchasing power, changing consumption patterns, increased access to
information and communication technology and improving infrastructure, the rural retail market
is estimated to cross US$ 45.32 billion mark by 2010 and US$ 60.43 billion by 2015, according
to a study by Confederation of Indian Industry (CII) and YES Bank.
As per the National Council of Applied Economic Research (NCAER) reports, there are 720
million consumers across 6, 27,000 villages in rural India.
According to a reportIndia Retail Report 2009 by Images FR Research, "India's rural
markets offer a sea of opportunity for the retail sector. The urban-retail split in consumer
spending stands at 9:11, with rural India accounting for 55 per cent of private retail
consumption." Rural India accounted for almost half of the Indian retail market, which was
worth about US$ 273.64 billion in September 2008. With most of the retail markets getting
saturated in tier-I and tier-II cities, the next phase of growth is likely to be seen in the rural
Major domestic retailers like AV Birla, ITC, Godrej, Reliance and many others have already set
up farm linkages. Hariyali Kisan Bazaars (DCM) and Aadhars (Pantaloon-Godrej JV), Choupal
Sagars (ITC), Kisan Sansars (Tata), Reliance Fresh, and Naya Yug Bazaar, are established rural
retail hubs. Retail giants like Reliance, Spencer's and Subhiksha are also expanding in semiurban and rural areas.

Luxury Retail
By the next four to five years, India is expected to become a manufacturing hub for global luxury
brands, according to a FICCI-Yes Bank report on luxury brands. The report states that India has
the most rapidly growing high-net worth individuals (HNI) population in the world, and the

income level of consumers is expected to grow three times by 2025. The active age group (2545
years) is likely to rise to a third of the population.
The report further states that the manufacturing business of luxury items in India can cross US$
500 million with global brands like Louis Vuitton and Frette looking at India as a manufacturing
According to a survey done by AT Kearney, the Indian luxury retail market is estimated to touch
US$ 30 billion by 2015. Estimated to be the 12th largest in the world, it has been growing at the
rate of 25 per cent per annum.

Retail Franchising
Along with e-tailing, another perceptible trend in the growth of organised retail market has been
the concept of retail franchising. According to industry estimates, retail franchising has been
growing at the rate of 60 per cent in the last three years and is set to grow two-fold in the next
five years. And with immense potential seen in this segment, the US$ 4 billion-franchising
industry is likely to see an almost two-fold rise in the number of franchisees (from 0.2 million)
by 2010.

Innovative Retail Concepts

With the entry of new players and the market becoming increasingly competitive, retail players
are using innovative retail concepts to attract consumers.
With reduced commodity prices and the recent excise duty cuts, input costs have come down by
around 25-30 per cent in several categories. Subsequently, many value retailers have brought
down prices by over 15 per cent for various product categories to encourage greater
consumption. They are also stepping up their bargains and discount offers. Retailers like Big
Bazaar, D'Mart, Spencer's and Food Bazaar, among other retailers, have begun slashing prices in
product categories like apparel, home products, and foods (private labels). In fact, modern
retailers are now also selling private labels with consumers looking out for cheaper brands.

Retail companies are also developing and promoting their in-house brands. The Future Group
will be targeting profits worth US$ 2.05 billion from its in-house brands in FMCG, household
consumer durable and electronics and apparel categories by 2012. After the good performance of
its in-house consumer brands such as Tasty Treat, Fresh & Pure, DJ&C, Koreo, the company
now wants to extend it to additional categories like health & beauty, dairy, apparel, and
Furthermore, Big Bazaar, the hypermarket chain of Future Group, is introducing Customer
Advisory Boards (CABs) as a measure for receiving valuable customer feedback.
With the US$ 6.31 billion pharma retailing becoming progressively more organised, players are
now looking at newer formats to attract more people to their stores. Pharmacy chains like
MedPlus and Goodlife have started providing health check-ups, diagnostic services, dental care
and medical counselling to its patients, besides selling pharma and wellness products.
Goodlife is tying up with the retail major, Future group, to set up these convenience clinics at
malls and in the high streets. MedPlus operates 15 such integrated clinics, and is planning to
open at least 50 such clinics by March 2009.
Innovative concepts in recreational retail are pulling people to malls, and big retail set-ups
account for a small but rapidly growing part of a multi-million dollar industry. There are a
variety of concepts like made-to-order pottery-painting, portrait-making, creating toons or
casting gold and silver impressions that have proliferated in malls or exist as standalone
ventures. In fact, a whole new concept of customised, leisure retail has opened up for the Indian

SWOT Analysis:
1. Retailing is a "Technology-intensive" industry. It is technology that will help the organized
retailers to score over the unorganized retailers. Successful organized retailers today work
closely with their vendors to predict consumer demand, shorten lead times, reduce inventory
holding and ultimately save cost. Example: Wal-Mart pioneered the concept of building
competitive advantage through distribution & information systems in the retailing industry.
They introduced two innovative logistics techniques cross-docking and EDI (electronic data
2. On an average a super market stocks up to 5000 SKU's against a few hundred stocked with an
average unorganized retailer. This will provide variety in products (required breadth & depth for
3. As a consequence of high volumes, procurement will be direct from the Manufacturer. Hence,
merchandise can be offered at lower costs.

1. Less Conversion level: Despite high footfalls, the conversion ratio has been very low in the
retail outlets in a mall as compared to the standalone counter parts. It is seen that actual
conversions of footfall into sales for a mall outlet is approximately 20-25%. On the other hand, a
high street store of retail chain has an average conversion of about 50-60%. As a result, a standalone store has a ROI (return on investment) of 25-30%; in contrast the retail majors are
experiencing a ROI of 8-10%

2. Customer Loyalty: Retail chains are yet to settle down with the proper merchandise mix for
the mall outlets. Since the stand-alone outlets were established long time back, so they have
stabilized in terms of footfalls & merchandise mix and thus have a higher customer loyalty base.

1. The Indian middle class is already 30 Crore & is projected to grow to over 60 Crore by 2010
making India one of the largest consumer markets of the world. The IMAGES-KSA projections
indicate that by 2015, India will have over 55 Crore people under the age of 20 - reflecting the
enormous opportunities possible in the kids and teens retailing segment.
2. Organized retail is only 3% of the total retailing market in India. It is estimated to grow at the
rate of 25-30% p.a. and reach INR 1,00,000 Crore by 2010.
3. Percolating down : In India it has been found out that the top 6 cities contribute for 66% of
total organized retailing. While the metros have already been exploited, the focus has now been
shifted towards the tier-II cities. The 'retail boom', 85% of which has so far been concentrated in
the metros is beginning to percolate down to these smaller cities and towns. The contribution of
these tier-II cities to total organized retailing sales is expected to grow to 20-25%.
4. Rural Retailing: India's huge rural population has caught the eye of the retailers looking for
new areas of growth. ITC launched India's first rural mall "Chaupal Saga" offering a diverse
range of products from FMCG to electronic goods to automobiles, attempting to provide farmers
a one-stop destination for all their needs." Hariyali Bazar" is started by DCM Sriram group
which provides farm related inputs & services. The Godrej group has launched the concept of
'agri-stores' named "Adhaar" which offers agricultural products such as fertilizers & animal feed
along with the required knowledge for effective use of the same to the farmers. Pepsi on the
other hand is experimenting with the farmers of Punjab for growing the right quality of tomato
for its tomato purees & pastes.

1. If the unorganized retailers are put together, they are parallel to a large supermarket with
no or little overheads, high degree of flexibility in merchandise, display, prices and
2. Shopping Culture: Shopping culture has not developed in India as yet. Even now malls
are just a place to hang around with family and friends and largely confined to windowshopping.
3. Cultural Variation leads to variation in merchandise in India at different geographical

Challenges in Retail:
The following are the key areas that may pose a threat to those retail companies that ignore the
impacts of giving less importance to manage their demand and supply: Forecasting and Inventory Management for JIT replenishments of products.
Peak Season Demand Handling.
Order Management in case of retailers with multiple outlets.
Warehouse Management in case of multiple outlets.
Introducing new products.
Handling variety of items.

Future Trend: Scope of 24hr retailing

The concept of 24hr. retailing in India has been present only in very limited formats like
the pharmaceuticals (Apollo) and fuel retail outlets (H.P, Reliance etc.) and the other
retail formats used to operate only till the early hours of the night. But because of the
changing lifestyles and the buying habits of the consumers the retailers have been
extending their operating hours till late nights.
Most of the Indian retail formats though capable of operating their formats round the
clock do not choose to do so because of the non feasibility of the idea at present taking in
conjunction the customers readiness. For instance if any of the hyper market or
supermarket is functioning during the night the retailer has to bear the extra costs of
electricity, labor and maintenance if the number of footfalls are less very low during the
late nights which otherwise would be profitable to him. Anyways, the shopping time of
the consumer is considerably increasing. Moreover, in India most of the retailing is all
about food and groceries. It might not be a rational prediction that all the consumers will
step into the retail outlet at midnights to buy food and groceries.
This problem can be overcome by implementing the idea in places which have a floating
population even during the nights like railway stations and bus stations. However with
the upcoming culture of malls and the changing lifestyles of the people one can design a
small part of the store or a mall for a new 24/7 retail format which consists of the
essential products like medicines, fruits and vegetables, groceries and some other FMCG
products and test market it. Once if the sales start showing some consistent positive
figures and if the crowd increases then the store can come in a bigger way to reach out to
their customers.

The other option for trying the concept of 24hr retailing is that the retailer can have a
mobile outlet which can place itself in the areas which have substantial night traffic for
the sales to happen. And once the people are to the 24hr shopping then the retail plans can
be altered accordingly.


We regularly talk about things like butter, potato chips, toothpastes, razors, household care
products, packaged food and beverages, etc. But do we know under which category these things
come? They are called FMCGs. FMCG is an acronym for Fast Moving Consumer Goods,
which refer to things that we buy from local supermarkets on daily basis, the things that have
high turnover and are relatively cheaper.
Fast Moving Consumer Goods (FMCG) goods are popularly named as consumer packaged
goods. Items in this category include all consumables (other than groceries/pulses) people buy at
regular intervals. The most common in the list are toilet soaps, detergents, shampoos, toothpaste,
shaving products, shoe polish, packaged foodstuff, household accessories and extends to certain
electronic goods. These items are meant for daily of frequent consumption and have a high
return. A major portion of the monthly budget of each household is reserved for FMCG products.
The volume of money circulated in the economy against FMCG products is very high, as the
number of products the consumer use is very high. Competition in the FMCG sector is very high
resulting in high pressure on margins.
FMCG companies maintain intense distribution network. Companies spend a large portion of
their budget on maintaining distribution networks. New entrants who wish to bring their products
in the national level need to invest huge sums of money on promoting brands. Manufacturing can
be outsourced. A recent phenomenon in the sector was entry of multinationals and cheaper
imports. Also the market is more pressurized with presence of local players in rural areas and
state brands.


The Indian FMCG sector with a market size of US$13.1 billion is the fourth largest sector in the
economy. A well-established distribution network, intense competition between the organized
and unorganized segments characterize the sector. FMCG Sector is expected to grow by over
60% by 2010. That will translate into an annual growth of 10% over a 5-year period. It has been
estimated that FMCG sector will rise from around Rs 56,500 crores in 2005 to Rs 92,100 crores
in 2010. Hair care, household care, male grooming, female hygiene, and the chocolates and
confectionery categories are estimated to be the fastest growing segments, says an HSBC report.
Though the sector witnessed a slower growth in 2002-2004, it has been able to make a fine
recovery since then. For example, Hindustan Levers Limited (HLL) has shown a healthy growth
in the last quarter. An estimated double-digit growth over the next few years shows that the good
times are likely to continue.
With the presence of 12.2% of the world population in the villages of India, the Indian rural
FMCG market is something no one can overlook. Increased focus on farm sector will boost rural
incomes, hence providing better growth prospects to the FMCG companies. Better infrastructure
facilities will improve their supply chain. FMCG sector is also likely to benefit from growing
demand in the market. Because of the low per capita consumption for almost all the products in
the country, FMCG companies have immense possibilities for growth. And if the companies are
able to change the mindset of the consumers, i.e. if they are able to take the consumers to
branded products and offer new generation products, they would be able to generate higher
growth in the near future. However, the demand in urban areas would be the key growth driver
over the long term. Also, increase in the urban population, along with increase in income levels
and the availability of new categories, would help the urban areas maintain their position in
terms of consumption. At present, urban India accounts for 66% of total FMCG consumption,

with rural India accounting for the remaining 34%. However, rural India accounts for more than
40% consumption in major FMCG categories such as personal care, fabric care, and hot
beverages. In urban areas, home and personal care category, including skin care, household care
and feminine hygiene, will keep growing at relatively attractive rates. Within the foods segment,
it is estimated that processed foods, bakery, and dairy are long-term growth categories in both
rural and urban areas.


Some of the merits of FMCG industry, which made this industry as a potential one are low
operational cost, strong distribution networks, presence of renowned FMCG companies.
Population growth is another factor which is responsible behind the success of this industry


Table 1.1.
S. NO. Companies


Hindustan Unilever Ltd.


ITC (Indian Tobacco Company)


Nestl India




Dabur India


Asian Paints (India)


Cadbury India

Britannia Industries


Procter & Gamble Hygiene and Health



Marico Industries

The following factors make India a competitive player in FMCG sector:
Because of the diverse agro-climatic conditions in India, there is a large raw material base
suitable for food processing industries. India is the largest producer of livestock, milk,
sugarcane, coconut, spices and cashew and is the second largest producer of rice, wheat
and fruits &vegetables. India also produces caustic soda and soda ash, which are required
for the production of soaps and detergents. The availability of these raw materials gives
India the location advantage.

Low cost labor gives India a competitive advantage. India's labor cost is amongst the
lowest in the world, after China & Indonesia. Low labor costs give the advantage of low

cost of production. Many MNC's have established their plants in India to outsource for
domestic and export markets.


Impulsive purchasing, generally defined as a consumers unplanned purchase which is an
important part of buyer behavior. It accounts for as much as 62% of supermarket sales and 80%
of all sales in certain product categories. Though impulsive purchasing has attracted attention in
consumer research, unfortunately there is a dearth of research on group-level determinants.
Marketers and retailers tend to exploit these impulses which are tied to the basic want for instant
gratification. For example, a shopper in a supermarket might not specifically be shopping for
confectionary. However, candy, gum, mints and chocolate are prominently displayed at the
checkout aisles to trigger impulse buyers to buy what they might not have otherwise considered.
Alternatively, impulse buying can occur when a potential consumer spots something related to a
product that stirs a particular passion in them, such as seeing a certain country's flag on the cover
of a certain DVD. Sale items are displayed in much the same fashion.
Impulse buying can also extend to so-called "big ticket" items such as automobiles and home
appliances. Automobiles in particular are as much an emotional purchase as a rational one. This
in turn leads auto dealers all over the world to market their products in a rapid-fire, almost
carnival-like manner designed to appeal to emotion over reason.
Impulse buying disrupts the normal decision making models in consumers' brains. The logical
sequence of the consumers' actions is replaced with an irrational moment of self gratification.
Impulse items appeal to the emotional side of consumers. Some items bought on impulse are not
considered functional or necessary in the consumers' lives. Preventing impulse buying involves
techniques such as setting budgets before shopping and taking time out before the purchase is

A study published in the June 2008 issue of the Journal of Consumer Research suggests that
consumers are more susceptible to making impulsive purchases for one brand over another if
they are distracted while shopping. In the study, Central Michigan University Psychology
professor Bryan Gibson surveyed college students by measuring their preference for a variety of
soft drinks, including Coke and Pepsi. Results of Gibson's study found that implicit attitudes, or
those that people may not be conscious of and able to verbally express, predicted product choice
only when participants were presented with a cognitive task, suggesting that implicit product
attitudes may play a greater role in product choice when the consumer is distracted or making an
impulse purchase.
There was a study conducted by Sales & Customer Service Department of Texas Agricultural
Extension Service Texas A&M University System College Station, Texas. According to this
study the researchers find the tips to increase the impulsive sales of the flowers. The findings of
the study were:
Tips for Boosting Impulse Sales:
Creating variety in the department with frequent changes of display and movement of regularly
sold merchandise also entices customers. Recognizing items that typically make a minimal
contribution to sales and replacing them with items that create "sales appeal" increases the
likelihood of impulse sales. Displays that tie in with a national slogan or storewide theme
generate interest, as do displays that highlight special products and services.
Tip 1: use color to create original, eye-catching displays.
Tip 2: use themes to create interest in unusual products and renew interest in everyday items.
Tip 3: keep undecorated plants available to attract consumers who are buying for
Tip 4: create displays that emphasize special products or services.
Tip 5: change stock and displays often so consumers are drawn into the department each week.
Tip 6: be flexible enough to change an item or arrangement that isnt selling.
Tip 7: have a person on hand to provide information and assistance at all times.
Tip 8: create a friendly, comfortable atmosphere with accessible displays that encourage
Tip 9: offer only quality plants and floral arrangements.

Tip 10: situate the department so that customers know where it is and can see it from most
areas of the store.
This research suggests that the presence of other persons in a purchasing situation is likely to
have a normative influence on the decision to make a purchase. The nature of this influence,
however, depends on both perceptions of the normative expectations of the individuals who exert
the influence and the motivation to comply with these expectations. Peers and family members,
are the two primary sources of social influence, often have different normative expectations.
Thus, it has been evaluated two factors that are likely to affect the motivation to conform to
social norms:
a) The inherent susceptibility to social influence and
b) The structure of the group
Group cohesiveness refers to the extent to which a group is attractive to its members. The theory
proposed by Fishbein and Ajzen helps conceptualize these effects. This theory assumes that
behavior is a multiplicative function of expectations for what others consider to be socially
desirable and the motivation to comply with these expectations.


In the present research paper, the study has been focused on Big Bazaar and Vishal Mega mart to
know the impulse buying behavior of the consumers. The brief profiles of two companies are as


Big bazaar is owned and operated by Future Bazaar India Ltd., a subsidiary of Pantaloon Retail
(India) Limited. As part of Indias largest retail chain, it enjoys the benefits of buying in bulk for
the entire group and keeps the margins low, so that customers get a great range of products at
great prices. Pantaloon Retail (India) Limited led by Kishore Biyani is the country's largest
retailer. It owns and operates multiple retail formats including Pantaloons, Big Bazaar, Food
Bazaar, Central, E-Zone, Fashion Station, Depot and many others. Pantaloon Retail was selected
as the Best of Best Retailers in Asia by Retail Asia-Pacific Top 500 magazine in 2006.Big Bazaar
was awarded the CNBC-Awaaz Consumer Awards in 2006 and the Readers' Digest Platinum
Brand Award 2006.


Future Group, led by its founder and Group CEO, Mr. Kishore Biyani, is one of Indias leading
business houses with multiple businesses spanning across the consumption space. While retail
forms the core business activity of Future Group, group subsidiaries are present in consumer
finance, capital, insurance, leisure and entertainment, brand development, retail real estate
development, retail media and logistics. Led by its flagship enterprise, Pantaloon Retail, the
group operates over 12 million square feet of retail space in 71 cities and towns and 65 rural
locations across India. Headquartered in Mumbai (Bombay), Pantaloon Retail employs around
30,000 people and is listed on the Indian stock exchanges. The company follows a multi-format
retail startegy that captures almost the entire consumption basket of Indian customers. In the
lifystyle segment, the group operates Pantaloons, a fashion retail chain and Central, a chain of
seamless malls. In the value segment, its marquee brand, Big Bazaar is a hypermarket format that
combines the look, touch and feel of Indian bazaars with the choice and convenience of modern
retail. In 2008, Big Bazaar opened its 100th store, marking the fastest ever organic expansion of
a hypermarket. The first set of Big Bazaar stores opened in 2001 in Kolkata, Hyderabad and
Bangalore. The groups speciality retail formats include, books and music chain, Depot,
sportswear retailer, Planet Sports, electronics retailer, Ezone, home improvement chain, Home
Town and rural retail chain, Aadhar, among others. It also operates popular shopping portal, Future Capital Holdings, the groups financial arm provides investment
advisory to assets worth over $1 billion that are being invested in consumer brands and
companies, real estate, hotels and logistics. It also operates a consumer finance arm with
branches in 150 locations. Other group companies include, Future Generali, the groups
insurance venture in partnership with Italys Generali Group, Future Brands, a brand
development and IPR company, Future Logistics, providing logistics and distribution solutions to
group companies and business partners and Future Media, a retail media initiative.
The groups presence in Leisure & Entertainment segment is led through, Mumbai-based listed

company Galaxy Entertainment Limited. Galaxy leading leisure chains, Sports Bar and Bowling
Co. and family entertainment centres, F123. Through its partner company, Blue Foods the group
operates around 100 restaurants and food courts through brands like Bombay Blues, Spaghetti
Kitchen, Noodle Bar, The Spoon, Copper Chimney and Gelato. Future Groups joint venture
partners include, US-based stationery products retailer, Staples and Middle East-based Axiom
Communications. The groups flagship company, Pantaloon Retail was awarded the International
Retailer of the Year 2007, by the US-based National Retail Federation, the largest retail trade
association and the the Emerging Market Retailer of the Year 2007 at the World Retail Congress
in Barcelona. Future Group believes in developing strong insights on Indian consumers and
building businesses based on Indian ideas, as espoused in the groups core value of Indianness.
The groups corporate credo is, Rewrite rules, Retain values.



What started as a humble one store enterprise in 1986 in Kolkata (erstwhile, Calcutta) is today a
conglomerate encompassing 183 showrooms in 110 cities / 24 states. Indias first hyper-market
has also been opened for the Indian consumer by Vishal. Situated in the national capital Delhi
this store boasts of the singe largest collection of goods and commodities sold under one roof in
India. Vishal Mega mart is Indias first hyper market which is having 126 showrooms in 83 cities
/ 20 states.
Vishal is one of fastest growing retailing groups in India. Its outlets cater to almost all price
ranges. The showrooms have over 70,000 products range which fulfills all your household needs,
and can be catered to under one roof. It is covering about 2059292 lac sq. ft. in 18 states across

India. Each store gives you international quality goods and prices hard to match. The group had a
turnover of Rs. 1463.12 million for fiscal 2006, under the dynamic leadership of Mr. Ram
Chandra Aggarwal. The group had of turnover Rs 2884.43 million for fiscal 2007 and Rs.
6026.53 million for fiscal 2008. The Vishal stores offer affordable family fashion at prices to suit
every pocket. The groups prime focus is on retailing. The Vishal stores offer affordable family
fashion at prices to suit every pocket.
.Vishal is one of fastest growing retailing groups in India. Its outlets cater to almost all price
ranges. The showrooms have over 70,000 products range which fulfills all your household needs,
and can be catered to under one roof. It is covering about 29, 90, 146 sq. ft. in 24 states across
India. Each store gives you international quality goods and prices hard to match. The cost
benefits that is derived from the large central purchase of goods and services is passed on to the
consumer. The groups philosophy is integration and towards this end has initiated backward
integration in the field of high fashion by setting up a state of the art manufacturing facility to
support its retail endeavors



Tirmizi Ali Muhammad, Rehman-Ur- Kashif, Saif Iqbal M.(2009) This paper investigates
the relationship between independent variables which are shopping lifestyle of consumers,
fashion involvement of consumers, pre-decision stage and post-decision stage of consumer
purchase behavior with the attitudinal and behavioral aspects of impulse buying behavior. This
study attempts to explore the association exists between the variables involved, by tapping the
responses of 165 respondents from higher income group in the area of Rawalpindi and
Islamabad. The major findings of the study demonstrated an overall weak association of the set
of independent variables with the dependent variable but, the in-depth analysis found that predecision stage of consumer purchase behavior is the only variable that resulted into strong
association with the impulse buying behavior. Its true that young people more often get attracted
to products displayed on store shelves and has greater tendency of impulse buying behavior but
results of this paper showed no association of impulse buying in higher income group of young
people having prevalent impulse buying tendencies. This study reported new evidences in the
field of impulse buying behavior of consumers pertaining to the local markets of the twin citiesof
Cheng Hua-Ching, Chang Hsieh-Quan(2006) This study proposes a social influence
perspective to compare the consumers impulse buying behaviors between Taiwan and China.
The social herding impulse buying factors are pursuing fashion, social norm, self- identity, and
consumer experience. We use binomial and multinomial logistic model to understand how

consumers influenced by social herding factors so that they became impulse buying behavior and
estimate the relationship between the frequency of impulse buying and herding factors. The
results are the consumers impulse buying influenced by social herding factors both in Taiwan
and China. The consumers impulse buying in China and Taiwan would be influenced from
different social herding factors. With the frequency of purchasing, consumers would be
influenced from different social herding factors.
Gutierrez Ben Paul B.(2004) The paper investigates factors influencing planned and impulse
purchases in six personal care product categories. This study utilizes a behavioral measure, rather
than an attitudinal measure of planned/impulse purchase. Data consist of 982 product purchases
of 502 consumers in urban Philippines. Results show that product category, purchase frequency,
brand comparison, and age are significant factors influencing planned and impulse purchases.
There is no relationship found between planned/impulse purchases and attitudinal shopping
values, surrogates for retail search strategies. Implications for retail management are identified.
Kim Jiyeon(2003) In this study author investigates that due to increasing competition and the
similarity of merchandise, retailers utilize visual merchandising to differentiate their offerings
from others as well as to improve the desirability of products. The purpose of this research is to
examine the relationship between college students apparel impulse buying behaviors and visual
merchandising. The result of the present study proves that there is a pivotal relationship between
college students impulse buying behaviors and two type of visual merchandising practices:
instore form/mannequin display and promotional signage. This study provides information as to
why visual merchandising should be considered an important component of a strategic marketing
plan in support of sales increase and positive store/company image. This study also provides
insights to retailers about types of visual merchandising that can influence consumers impulse
buying behaviors.
Buendicho Patricia(2003) The author identifies that Impulse purchasing has been a focus of
marketing research since the sixties. Researchers have attempted to explain impulse purchasing
with the sciences of psychology and even philosophy. Previous research has failed to come up
with a model for such, perhaps because of the intangibility of psychological traits of impulsivity
or the rationality in which philosophy has its roots in. Yet it is a prevalent phenomenon in the

daily life of the average consumer, you and me. Empirical studies have reached no consensus
either, and adding the confusion are the many definitions if impulse purchasing and many
products of different purposes and prices. There exists no model that serves as an effective
predictor of an impulse buy. It seems that the phenomenon of impulse purchasing has managed
to evade. This study focuses on explaining impulsive shopping through trends by testing the
validity of hypothetical relations between socioeconomic factors such as gender, wealth, age,
residence, present company and impulse shopping. Qualitatively, this is a case study in which we
explore what people purchase and their personal reasons.Quantitatively, we set out to find
predictors as we examine what makes Orlando shoppers open their wallets on the spot.
Mai Tuyet Thi Nguyen, Kwon Jung, Loeb Sandra, Lantz Garold(2001) The author
proposes that the economy transition in Vietnam has created many changes including the changes
in consumer values and the retail environment. This significantly affects consumer buying
behaviors. Impulse buying is very interesting and important consumer behavior that has attracted
a lot of research effort in the world. This paper examines several factors influencing the impulse
buying behavior of urban Vietnamese consumers. A consumer survey was conducted in two
major cities of Vietnam: Hanoi and Ho Chi Minh City. The results support the hypotheses that
buying impulsiveness, shopping enjoyment tendency, and level of modern-self are positively
related to impulse buying. However, the level of traditional-self perception is not found to be
significantly related to impulse buying behavior. Other findings regarding the impact of
demographic variables are also reported.
Rook Dennis W.,Fisher, Robert J.(1995) The author examines that although consumer
researchers have investigated impulse buying for nearly 50 years, almost no research has
empirically examined its normative aspects. This article presents conceptual and empirical
evidence that consumers' normative evaluations (i.e., judgments about the appropriateness of
engaging in impulse buying behavior) moderate the relationship between the impulse buying trait
and consumers' buying behaviors. Specifically, the relationship between the buying
impulsiveness trait and realted buying behaviors is significant only when consumers believe that
acting on impulse is appropriate. The findings from two studies across student and retail
customer samples converge and support the hypothesized moderating role of consumers'
normative evaluations.

Kollat, Willet,(1967) defined the first categories of impulse purchases as follows: Brand
decided; category decided; product class decided; general need recognized (i.e. need a birthday
gift); general need not recognized. The latter has no planning whatsoever and is there fore
recognized as pure impulse purchasing (Bayley). The phenomenon regained attention in the
eighties, where the experiential aspect of impulse shopping itself began to be explored. Engel
and Blackwell defined impulse purchasing as a buying action undertaken without a problem
previously having been recognized or buying intention been formed before entering the
store.(Engel.) This is the most widely accepted definition of impulse shopping.


Research methodology is a way to systematically solve the research problem. It may be
understood as a science of studying how research is done scientifically.
TITLE - Factors affecting impulse buying behavior in FMCG sector with special reference to
big Bazaar and Vishal Mega mart in Chandigarh & around region.
The research methodology was divided into two stages which involve two sources for collecting
the data in order to achieve the objective of project.
1. Collecting data regarding the potential customers from the existing outlets of Big Bazaar &
Vishal Mega mart.
2. Collecting the primary data directly with the customer with the help of the
questionnaire (Refer Annexure-1)
The research methodology was divided into two stages which involve two sources for collecting
the data in order to achieve the objective of project. We have taken into consideration a
hypothetical consumer impulse buying behavior model
which has been mentioned in conclusion and findings part.

A research design is an arrangement of conditions for collection and analysis of data in a manner
that aims to combine relevance to the research purpose with economy in procedure. A good
research design has the characteristics viz problem definition, specific method of data collection
and analysis, a research design is purely and simply the frame work or planned for a study that
guides the collection and analysis of data. In this research Exploratory research method is

A sample design has been defined as a definite plan for obtaining a sample from a given
population. In this project Multi Stage Sampling is used because the total population was too
large and due to time constraint it was not practically possible to make a list of entire population.
At first stage I have divided sample area wise and then further divided it into income status so
that I can get correct and related information.

Unit: Vishal Mega mart and Big Bazaar Customers


Size: 100 potential customers


technique: Multistage sampling


area: Chandigarh and around region


Method: Personal Contacts

Both primary data and secondary data have been used for the purpose of data collection. Primary
data has been collected by conducting survey with the help of a questionnaire. Questionnaires
were formed as to search the specific variable on which objectives depends. Secondary data on
the other hand are those data which have already been collected by someone else which have
already been passed through the statistical process.


To understand and analyze various factors influencing sales promotion

program in retail industry.

To know the factors which influence the purchase decision.

To measure the sales promotion effectiveness in retail Industry.

It attracts the brand switchers and increases the sales volume.


The scope of the study gives an idea to develop the sales promotion activities
in retail industry. It involves the evaluation of the present promotional activities.
With the help of the study we can give suggestion regarding sale promotion and
services offered by the retail industry. The study brings an awareness of the sales
promotional activities by advertising in an accepted media.


In attempt to make this project authentic and reliable, every possible aspect of the
topic was kept in mind. Nevertheless, despite of fact constraints were at play
during the formulation of this project. The main limitations are as follows:
Due to limitation of time only few people were selected for the study. So the
sample of consumers was not enough to generalize the findings of the study.

The main source of data for the study was primary data with the help of selfadministered questionnaires. Hence, the chances of unbiased information are
People were hesitant to disclose the true facts.
The chance of biased response cant be eliminated though all necessary steps
were taken to avoid the same.


Demographic profile of respondents
Descriptive profile of respondents (n=100)
Fig.4.1. Demographic data for genders

The above graph inferences that most of the time male genders are the one who goes for impulse
buying decision i.e. 88% are male respondents in our research while female comprises of only
12% of the total respondents.
Fig.4.2. Demographic data considering different age groups
From the graph its easily visible that the age group 20-25 are the one who go maximum times for
impulse buying since this is the age group when they are most active having some power of
purchasing too.

Fig.4.3. Demographic data considering their occupations

From the graph its clear that most of the impulse buying is being done by students which
compromises of 51% of total 100 respondents 23% is for the services providing people and 20 %
to the business oriented person and at last only 6% comprises of house wifes.
Factor Analysis for factors affecting impulse buying decision of Consumers
To continue towards the main analysis, factor analysis has been performed to identify the key
dimensions affecting purchase of FMCG products provided at these retail stores. The respondent
ratings were subject to principal axis factoring with varimax rotation to reduce potential
multicollinearity among the items and to improve reliability on the data (Refer Table 6: Rotated
Factor Matrix). Varimax rotation (with Kaiser Normalization was converged in twenty six
iterations. Twenty Six items were reduced to seven orthogonal factor dimensions which
explained 72.357% of the overall variance (Refer Table 4) indicating that the variance of original
values was well captured by these seven factors. The seven factors and their components is given
in table 7. (Refer Table 7)
Reliability of Data (KMO and Bartlett's Test)
Analysis done with the help of statistical software SPSS

Kaiser-Meyer-Olkin Measure of Sampling



Bartlett's Test of

Approx. Chi-Square


Table 4.1.
[Index for comparing the magnitudes of the observed co-relation coefficient to the magnitude of
the partial correlation coefficients] From the above table, we can interpret that there is no error in
60.5% of the sample and in the remaining 39.5%, there may occur some sort of error.
Bartletts Test of Sphericity
Strength of relationship among variables is strong. It presents good idea to proceed to factor
analysis for the data.
Ho: There is significant indifference of all the factors affecting impulse buying decision
H1: There is significant difference of all the factors affecting impulse buying decision
The observe significance level is 0.0000 which is less than .05, which is small enough to reject
the hypothesis. It means there is a significant difference between the factors affecting impulse
buying decisions.
Communality- Common Factor Variance
Communality of each statement refers to the variance being shared or common by other
statements. With reference to the first statement, the extraction is .639 which indicates that
63.9% of the variance is being shared or common to other statements. (Refer Table 2.)
Eigen Value: Indicates the amount of variance in the original variables accounted or by each
component. The total initial variance in the new components will be 26
Table 4.2: Communalities
Common Factor variance

Table 4.3.: Total Variance Explained


Initial Eigenvalues

Extraction Sums of
Squared Loadings

Rotation Sums of Squared


Table 4.4.: Distribution in different components

Component 1

Explain a variance of 4.735,

which is 18.213% of the total


Component 2
Component 3
Component 4
Component 5
Component 6
Component 7

variance of 26
Explain a variance of 3.308,
which is 12.724% of the total
variance of 26
Explain a variance of 3.108,
which is 11.955% of the total
variance of 26
Explain a variance of 2.620,
which is 10.079% of the total
variance of 26
Explain a variance of 1.734,
which is 6.670% of the total
variance of 26
Explain a variance of 1.654,
which is 6.363% of the total
variance of 26
Explain a variance of 1.652,
which is 6.353% of the total
variance of 26


Fig 4.4. Screen plot for the Factor Analysis

With the help of Table 3 and 4, we can interpret that 26 statements are now reduced to 7
components contributing 72.357% of the total variance. With the help of Fig4. Screen plot, we
can just visualize that 7 factors are reduced with Eigen value greater than 1.0000

Table 4.5. Component Matrix:

This table reports the factor loadings for each variable on the unrotated components or factors.

















































































































































































































Extraction Method: Principal Component Analysis.

Each number represents the correlation between the item and the unrotated factor. This
correlation helps to formulate an interpretation of the factors or components. This is done by
looking for a common thread among the variables that have large loadings for a particular factor
or component. It is possible to see items with large loadings on several of the unrotated factors,
which makes interpretation difficult. In these cases, it can be helpful to examine a rotated
Table 4.6: Rotated Component Matrix

















































































































































































































Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization.
With the help of table 6, we can categorize each statements depending upon the factor loadings
and shown in table7.
Table 4.7.: Factors
Factor 1:
S5 :Advertisement of product in print and visual media

S6 :Various promotional activities regarding product

S7 : Hording and pamphlets of product

S10 :Packaging of product

S11 : Placing of product in store

S13 : Emotional attachment with product

S14 : Behavior of sales person

S15 : Popularity of product

S17: The person with whom you are going for shopping

Factor 2:

S3 :Various schemes like (buy 1 get 1 free)

S12: Compatibility of another product with the product you are buying

S18: Influenced by other people

S19: Kind of product which you are buying

Factor 3:

S8 : Any event organized by organization

S9 : Display of product in store

S22 :Your perception about saving and investment

S25 :Traditions and customs

S26 : Various festival discounts on product

Factor 4:

S1 :Price of product

S20 :Your income status

S21 :Standard of living

Factor 5:

S4 :Availability of product

S24 :Requirement of product in festival season

Factor 6:

S2 :Discount offers regarding product

Factor 7:

S16 :Changing trends in society

S23 :Special occasions

Table 4.8.: Component Score Coefficient Matrix










From the table 8 of component score coefficient matrix, we can obtain the quantifiable data of
each factor. The coefficients between the statements and the factors are taken according to the
statement affecting the factor (on the basis of Table 7)




Since Indian retail market is continuously increasing, people are purchasing goods as there is
increase of income of common people as well as change in tastes and preferences of consumers.
It is important for the retail players to be able to understand the different factors affecting the
extent in impulse buying behavior.
The factor analysis results indicate that Factor 1 (Table 7) which consists of Information
provided by customers - Advertisement of product in print and visual media, Various
promotional activities regarding product, Hording and pamphlets of product, Packaging of
product, Placing of product in store, Emotional attachment with product, Behavior of sales
person, Popularity of product, The person with whom you are going for shopping are the main

factors for impulse buying behavior which broadly defines about the Emotional appeal of
Factor 2 includes various schemes like (buy 1 get 1 free), Compatibility of another product with
the product you are buying, Influenced by other people, Kind of product which you are buying
Customers impulse buying decision causing a variance of 3.308.This shows that importance of
influence of other peoples on buying behavior of customers.
Factor 3, includes from Table-7 ,Any event organized by organization, Display of product in
store, Your perception about saving and investment, Traditions and customs, various festival
discounts on product, which in totally shows the direct impact product placement in the stores in
a retail outlet like Vishal Mega mart & Big Bazaar.
Factor 4 includes Price of product, your income status, and Standard of living, which clearly
defines the individual purchasing power.
Continuing with the next factor- Factors 5 includes Availability of product, Requirement of
product in festival season which shows that discount offers during festival seasons attract
customers for their impulse buying behavior.
While Factor 6 includes Discount offers regarding product, focusing on effective price and
discount strategies which is in brought by the retail players in order to attract there potential
At last Factor 7 includes Changing trends in society, special occasions which signifies that how
much today also people give preferences to the traditions and rituals during festival season that it
has created a emotional bond which results in impulse buying behavior. Overall, various internal
and external factors affects the impulse buying behavior of the consumer which is explained by
the above findings
Fig 5.1.


Although the study was conducted on a small population to find Impulse Buying Behavior of the
consumer In Vishal Mega mart and Big Bazaar, the finding of the studies can be generalized to
the whole population. It can be very comfortably inferred that:
1. Emotional appeal of advertisements
2. Brand image of the product
3. Product placement in the store
4. Income of the customer
5. Various festival seasonal discounts
6. Effective pricing and discount strategy
7. Emotional Bonding and usage of the product in festivals affect impulse buying behavior of the
consumer very strictly.
The Indian marketers has to go a long way to understand the impulse buying behavior as it is a
very subjective and its depends on multiple factors, but marketers can take advantage for this
behavior and in almost every product category impulse buying witness.


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Name ..
Age .
Gender - MALE / FEMALE
Occupation .
According to you, which of these factors affect your impulse buying behavior for FMCG
Attractive price of product affects my impulse buying




Discount offers regarding product attracts me
Various schemes like (buy 1 get 1 free) affects my buying
behavior positively
Availability of discounted products motivates me to buy


Advertisement of product in print and visual media attracts
me to buy
Various promotional activities regarding product motivates
to buy the products
Hording and pamphlets of product help me in impulse
Any event organized by organization affects my buying
Display of product in store attracts my attention
Packaging of product attracts me to by the products
Placing of product in store gains my attention towards it
Compatibility of another product with the product you are

Emotional attachment with product is a motivational factor
to buy product
Behavior of sales person affects my buying behavior
Popularity of product increases recall value and helps in
impulse buying
Changing trend in society is a major factor in impulse

The person with whom you are going for shopping
influences my buying behavior

Comments of reference group influence my buying

Kind of product which i am buying

Your income status affects my impulse buying behavior
Standard of living has a role to play in buying products
Your perception about saving and investment
Special occasion motivate me to buy
Requirement of product in festival season prompts me to
Traditions and customs triggers my purchase decision
Various festival discounts on product induces purchase of