INFLUENCE OF REFERENCE GROUP ON CONSUMER

BUYING BEHAVIOUR OF MOBILE PHONES

SUBMITTED BY,
TINA CHACKO
VISMAYA JOJU
SHEETHAL TONY
SREELAKSHMI .S
SREELAKSHMI V.T
 CONTENTS

SL. NO. CHAPTER NO PAGE NO

1 INTRODUCTION

2 LIETRATURE REVEIW
3 THEORIES OF STUDY
4 RESEARCH
METHODOLOGY
5 DATA ANALYSIS
6 FINDINGS
7 SUGGESTIONS
8 BIBLIOGRAPHY
 CHAPTER 1
INTRODUCTION
INTRODUCTION
A consumer is one that buys good for consumption and not for resale or
commercial purpose. The consumer is an individual who pays some
amount of money or the thing required to consume goods and services.
As such, consumers play a vital role in the economic system of a nation.

Consumer buying behaviour is the result of the attitudes, preferences,

intentions and decisions made by the consumer s in a market place
before buying a product. The study of consumer buying behaviour is an
interdisciplinary subject area drawing widely from sociology,
psychology, anthropology etc.

A mobile phone, cell phone, cell phone, or hand phone, sometimes

shortened to simply mobile, cell or just phone, is a
portable telephone that can make and receive calls over a radio
frequency .The mobile phone market is one of the vast areas to study the
technological revolution in the mobile sector escort booming market for
the mobile phones. The mobile phone sector in India has become very
popular nowadays. Its growth is so prodigious that it has crossed most of
the industries. There is a significant impact of consumer behavior on the
strategic decisions made by the mobile sector companies. In technology
driven businesses, understanding the voice of consumers and their
buying patterns has emerged a tough challenge for the mobile
companies. The reason for the growth of this sector is consumer
involvement as human being spends most of his time in interacting with
others. In modern business scenario consumers are considered as the
inception point and the last corner of marketing activities.

An organization has to synchronize all its activities towards the

enhancement and achievement of satisfaction of the consumer at every
stage. For achieving customer satisfaction, understanding of dynamic
consumer behaviour is essential. Understanding the consumer behaviour
is the most prominent topic to understand by the marketers so as to frame
marketing strategies for customer satisfaction. India being a developing
market and being a nation of diverse cultures and traditions it becomes
mandatory for mobile companies to have a deep understanding of buying
behaviour of consumer and buying patterns of mobile phones by Indian
consumers. With the advent of globalization and the sequel changes in
the country many mobile companies have started making a foray into
Indian mobile market due to its sky-scraping potential. As a result of
tremendous growth in mobile sector, mobile penetration in the mobile
market has overshadowed all other means of communication.

Reference groups includes individuals or groups that influence our

opinions, beliefs, attitudes and behaviours. They often serve as our role
models and inspiration. Marketers view reference groups as important
because they influence how consumers interpret information and make
purchasing decisions.

Objectives of study
 To know the influence of reference group on consumer buying
behaviour of mobile phones.
 To know the most preferred features of the mobile phones by the
consumers.
 To know the frequency of times the consumers change the phones.
 To know the medium of purchase in buying mobile phones.

Scope of the study

The scope of the study is to understand the influence of reference
group on the purchasing behaviour of consumers on mobile
phones.
 Top mobile brands
 Samsung
 Apple
 Vivo
 Oppo
 Huawei
 Redmi
 Motorola
 One Plus
 Sony
 Nokia

Factors influencing buying behaviour of mobile phones

 Price
 Social Factors
 Durability
 Brand Name
 Product Features
 After Sales.

1. REFERENCE GROUPS

1. A normative reference group influences your norms, attitudes, and values

through direct interaction.

 Parents
 Siblings
 Teachers
 Peers
 Associates
 Friends

2. A comparative reference group is a group of individuals whom you compare

yourself against and may strive to be like.

 Celebrities

 Heroes
 CHAPTER 2
LITERATURE REVIEW
Literature review
Consumers are individuals and households that buy the firms product for
personal consumption (kotler, 2004). It often used to describe two different
kinds of consuming entities: the personal consumers and the organizational
consumers (krishna, 2010). The activities these consumers undertake when
obtaining, consuming, and disposing of products and a service is known as
consumer behavior. Consumer behavior involves studying how people buy,
what they buy, when they buy and why they buy. When a consumer wanted
to make the purchase decision, they will pass through the process through
recognition, search information, evaluation, purchase, feedback (blackwell,
miniard, and engel, 2006). At last, the consumer will choose a product or
brand to consume from various choices in the market. However, these factors
affecting the buying behavior of consumers vary due to diverse
environmental and individual determinants. Consumer buying behavior is
influenced by two major factors. These factors are individual and
environmental. The major categories of individual factors affecting consumer
behavior are demographics, consumer knowledge, perception, learning,
motivation, personality, beliefs, attitudes and life styles. The second category
of factors is environmental factors. Environmental factors represent those
items outside of the individual that affect individual consumer’s decision
making process. These factors include culture, social class, reference group,
family and household. The above mentioned factors are the major
determinants behind the decision of consumers to opt a given good or service
(blackwell, miniard, and engel, 2006). Ethiopia is a developing country and
has witnessed fast economic growth and developments in mobile
telecommunication penetration in recent years. Due to these reasons, there is
a dynamic increase in the number of mobile phone device users. This
attracted large number of international firms to enter into mobile industry
and offer various brands of mobile phones. However, the choice of consumer
is diverse due to various factors associated with consumer behavior. In this
context, it is important to study the various factors which shape the
consumers mind during the purchase of mobile phone devices. According to
karjaluoto et al. (2005), price, brand, interface, and properties tends to have
the most influential factors affecting the actual choice amongst mobile phone
brands. Ling, hwang and salvendy (2007) surveyed college students to
identify their preference of their current mobile phone. The results of their
survey indicated that the physical appearance, size and menu organization of
the mobile phones are the most determinant factors affecting the choice of
mobile phones. Mack and sharples (2009) showed that usability in the most
important determinant of mobile choice; other attributes particularly features,
aesthetics and cost are other factors that have implication on the choice of
mobile phone brand. In other study conducted by kumar (2012), price,
quality and style functions as the most influential factors affecting the choice
of mobile phones. Moreover, saif et al, 2012 selected four important factors
i.e. Price, size/shape, new technology features and brand name and analyzed
their impact on consumers’ buying behavior. According to his result,
consumer’s value new technology features as the most important variable
that influences consumers’ to go for a new mobile phone purchase decision.
Eric and bright (2008) conducted a study on factors that determine the choice
of brands of mobile phone in ghana specifically kumasi metropolis.
Accordingly, the results of the study showed that the first most important
factor is reliable quality of the mobile phone brand and the other factor is
user-friendliness of the brand of the mobile phone. Likewise, das (2012)
conducted an empirical research based on survey method on factors
influencing buying behavior of youth consumers towards mobile handsets in
coastal districts of odisha located in india. According to the study, a handset
of reputed brand, smart appearance, and with advanced value added features,
pleasurability and usability; is the choice of young consumers; females in
gender-group, post-graduates in level of education-group, students in
occupational group, urban residents in geographical area group plays most
prominent role in buying decision of a mobile handset. Pakola et al. (2010)
attempted to investigate consumer purchasing motives in cellular phone
markets. The results indicated that while price and properties were the most
influential factors affecting the purchase of a new mobile phone, price,
audibility and friends’ operator were regarded as the most important in the
issn 2039-2117 (online) issn 2039-9340 (print) mediterranean journal of
social sciences mcser publishing, rome-italy vol 4 no 12 october 2013 105
choice of the mobile phone operator. As well, saif (2012) analyzed the
factors affecting consumers’ choice of mobile phone selection in pakistan.
The results indicated that consumer’s value new technology features as the
most important variable amongst all and it also acts as a motivational force
that influences them to go for a new handset purchase decision.
Subramanyam and venkateswarlu (2012) conducted a study on factors
influencing buyer behavior of mobile phone buyers in kadapa district in
india. The researchers studied the various types of marketing strategies
adopted by market to acquire the attention and cognition of both existing and
potential customers, and to study what role these marketing strategies play in
consumer buying process. According to the results, income, advertising and
level of education in a family are the determining factors of owning a mobile
phone set. Malasi (2012) examined the influence of product attributes on
mobile phone preference among undergraduate university students in kenya.
The study indicated that varying the product attributes’ has an influence on
the undergraduate students’ preferences on mobile phones. Various aspects
of product and brand attributes were considered such as color themes, visible
name labels, and mobile phone with variety of models, packaging for safety,
degree of awareness on safety issues, look and design of the phone. Based on
previous research studies and literatures reviewed the following conceptual
framework and research hypothesis were developed for this research project.
Accordingly, six independent variable (i.e. Price, social factors, durability,
brand name, product features and after sales services) thought to influence
the dependent variable (i.e. Decision to by) are identified. Figure1:
conceptual framework of the study the research is examined through the
following hypotheses: • h1: the social factors have a positive influence on the
consumers’ mobile phone buying decision. • h2: durability has a positive
influence on consumers’ mobile phone buying decision. • h3: price has a
positive effect on consumer’s mobile phone buying decision. • h4: after sales
services influence consumers’ decision to acquire mobile phones. • h5:
mobile phones features influence consumers’ decision to acquire mobile
phones.
 CHAPTER 3
THEORIES OF STUDY
CONSUMER DECISION MAKING
Consumer decision making process involves the consumers to identify their
needs, gather information, evaluate alternatives and then make their buying
decision. The consumer behavior may be determined by economic and
psychological factors and are influenced by environmental factors like social
and cultural values.

Maslows need theory

Maslow (1943, 1954) stated that people are motivated to achieve certain needs and
that some needs take precedence over others.
Our most basic need is for physical survival, and this will be the first thing that
motivates our behavior. Once that level is fulfilled the next level up is what
motivates us, and so on.
1. Physiological needs - these are biological requirements for human survival, e.g.
air, food, drink, shelter, clothing, warmth, sex, sleep.
If these needs are not satisfied the human body cannot function optimally. Maslow
considered physiological needs the most important as all the other needs become
secondary until these needs are met.
2. Safety needs - protection from elements, security, order, law, stability, freedom
from fear.
3. Love and belongingness needs - after physiological and safety needs have been
fulfilled, the third level of human needs is social and involves feelings of
belongingness. The need for interpersonal relationships motivates behavior
Examples include friendship, intimacy, trust, and acceptance, receiving and giving
affection and love. Affiliating, being part of a group (family, friends, work).
4. Esteem needs - which Maslow classified into two categories: (i) esteem for
oneself (dignity, achievement, mastery, independence) and (ii) the desire for
reputation or respect from others (e.g., status, prestige).
Maslow indicated that the need for respect or reputation is most important for
children and adolescents and precedes real self-esteem or dignity.
5. Self-actualization needs - realizing personal potential, self-fulfillment, seeking
personal growth and peak experiences. A desire “to become everything one is
capable of becoming.
 Chapter 4
RESEARCH METHODOLOGY
Research objective
To know and understand the consumer preference of mobile phones through
the influence of reference group. This will help to know how refernce group
like family, friend etc influences the purchasing behaviour of consumers and
also what are the key concerns from the point of view of customers while
purchasing mobile phones.

DATA COLLECTION METHODS

The data is collected through primary as well as secondary data.

Primary Data
This is the data that is collected in primary basis directly from the users.
Primary data is collected through Google forms and questionnaires.

Secondary data
Secondary data is a data used to support the primary data and is collected
through various sources. Secondary data is collected from Google.

SAMPLE DESIGN
Sample Unit

Samples were randomly selected from people of Ernakulum and

Trissur district, to know the influence of reference group in
purchasing mobile phones.
SAMPLING METHODS

RANDOM SAMPLING
Random sampling is a way of selecting a sample of observations from a
population in order to make inferences about the population. For example,
exit polls from voters that aim to predict the likely results of an
election. Random sampling is also known as probability sampling.

Convenient Sampling
Convenience sampling is a non-probability sampling technique where
subjects are selected because of their convenient accessibility and proximity
to the researcher.

SAMPLE SIZE
The sample size of the study is 100 people from Ernakulam as well as
Trissur district.