IDENTIFYING THE FACTORS AFFECTING THE PURCHASE

DECISION OF HAIR CARE PRODUCTS*

A Thesis Presented to
The Department of Retail Management at
K J Somaiya Institute of Management Studies and Research, Mumbai

In the Partial Fulfilment

of the Requirements for PGDM Retail Management*

By:
Varun Agarwal
(Roll No 58; Batch 2017-19)

March 2019*

Under the Supervision of*

Prof. Shiji Lyndon*

1
 STUDENT’S DECLARATION

I, Varun Agarwal declare that the master thesis titled Identifying the Factors Affecting the
Purchase Decision of Hair Care Products, submitted by me in the partial fulfilment required
for the award of PGRM-RM at K J SIMSR,*Mumbai is a record of work carried out by me
during the period from July, 2018 to February, 2018 under the guidance of Prof. Shiji Lyndon

To the best of my knowledge the thesis is a record of authentic work carried out by me during
the given period and has not been submitted to any other institute for the award of any degree.*

I have cited the original sources adequately with proper references. I also declare that I have
adhered to all principles of academic integrity and have not mispresented,*fabricated or falsified
any data in my submission.

Varun Agarwal
Date:
Place: Mumbai

2
 CERTIFICATE OF FACULTY GUIDE

It is Certified that the work administered in the master thesis titled, Identifying the Factors
Affecting the Purchase Decision of Hair Care Products submitted by Varun Agarwal was
carried out under my supervision.

This is authentic work and any such materials that have been obtained from other sources have
been duly acknowledged in this thesis

Signature of the Faculty Guide

Date:
Place: Mumbai

3
 TABLE OF CONTENTS

Page No.

CANDIDATE’S DECLARATION 2
CERTIFICATE 3
LIST OF CONTENTS 4
LIST OF FIGURES 6
ABSTRACT 7
ACKNOWLEDGEMENT 8
CHAPTER 1: INTRODUCTION 9
1.1. Hair Care Industry Overview 9
1.2. Herbal and Natural Products 9
1.3. Packaging of Hair Care Products 10
1.4. Fragrance and Hair Care Products 10
1.5 Purpose of the Study 11
CHAPTER 2: LITERATURE REVIEW 12
2.1. Packaging 12
2.2. Product Characteristics 12
2.3. Branding and Marketing 13
2.4. Quality & Price 13
2.5 Effect of Gender and Generation 14
CHAPTER 3: THEORETICAL FRAMEWORK 15
3.1. 4P’s of Marketing Mix 15
3.2. Customer Behaviour Theories 16
3.3. Customer decision Making Theory 17
CHAPTER 4: RESEARCH METHODOLOGY 18

4
 4.1. Primary Research 18
4.2. Secondary Research 18
4.3. Research Gap 18
4.4. Objective 19
CHAPTER 5: ANALYSIS 20
5.1. Demographic Profile 20
5.2. Place of Purchase 21
5.3. Expense on Hair Care 22
5.4. Types of hair Care products used 22
5.5 Reasons for use of hair care 22
5.6. Factors Influencing Purchase Behaviour 23
5.7. Findings 27
5.8. Recommendation 28
5.9. Conclusion 28
5.10 Limitation 28
REFERENCES 29
ANNEXURE A (QUESTIONAAIRE) 30

5
 LIST OF TABLES

Table No. Table Title Page No.

Table 1 Demographic Profile 20
Table 2 Expenditure and Place of Purchase 21
Table 3 Type of Hair Care Products and Level of Importance 23
Table 4 Reasons of Purchase of Hair Care Product 24
Table 5 KMO Barlett’s test 24
Table 6 Variance Explanation: Factor Analysis 25
Table 7 Rotated Component Matrix 25
Table 8 Factor Loading: User received Value 26
Table 9 Factor Loading: Promotions and Marketing 26
Table 10 Factor Loading: Brand Value 26
Table 11 Factor Loading: Purchase Source 27
Table 12 Factor Loading: Product Attributes 27
Table 13 Cumulated Averages 5

6
 ABSTRACT

This study focuses on some of the influencers that have an effect on purchase of hair care products
in Mumbai, India. It intends to examine the influencers such as social factors, marketing mix and
customer esteem on the purchase hair care products.

To do so, the following theories were employed as a theoretical framework:

 Customer Behavior Theory

 Customer Decision Making’s Theory
 Four Ps In Marketing Mix
It also aims to ascertain what the reasonable impact factors of perception on the relationship could
be between variables and consumer behaviors.

A questionnaire was adopted M. Chanintorn, S Jiraporn (2010) and distributed to men and women
who are in the age range between 15-45 years old and living in Mumbai, India. The total sample
consists of 102 respondents. Further, the returned questionnaires were analyzed by using factor
analysis, correlation and descriptive statistics in SPSS.

Hair care products are a part of the FMCG industry which has a market size of US$ 52.75 billion
(2017-18), so is considered as the 4th largest sector in the Indian economy. These products have
low financial risk and social risk, also they have a short shelf turnover time. All these factors makes
for a very lucrative category and gathers a lot of interest. Thus, making it a highly competitive
market. However, the consumer products have low involvement of consumers and there is often
no extensive pre purchase search to determine a suitable product.

The decision making behaviour is either routinized or impulsive. Therefore, the marketers
have to make great efforts to make their products more appealing and existent to the customer
eye. Then only consumers can make a decision in favour of a particular product.

Keywords: Consumer buying behaviour, FMCG, Hair Care, Demographic factors,

Psychographic factors, Behavioural factors.

7
 ACKNOWLEDGEMENT

I feel extremely privileged to have received timely guidance and support from a lot of people for
the successful completion all along the duration of my project.

I would like to thank my master thesis guide Prof. Shiji Lyndon for her prompt support and at all
times. It was due to her positive support and constructive inputs that the thesis was concluded
successfully. I would also like to thank Program Coordinator of PGDM-Retail Management Dr.
Vandana Khanna, Program Co Coordinator Prof. Vilasini Jadhav for the guidance throughout the
two years of my academic program.

I would also like to take the opportunity to thank United Biscuits for introducing me to the field
of consumer goods and make me understand through the period of two months as to what factors
influence the sales on the ground. Also, the knowledge from the grassroots level helped me apply
the insights in theory as well.

Last, I would like to thank all the respondents for filling up the form and providing necessary
information regarding the same.

Varun Agarwal

8
 INTRODUCTION
1. Hair Care Industry Overview (India):
The Hair care packaging industry in India is estimated to be over ₹22,500 crore and categories
operating in the business have experienced a CAGR of 9.6%. With 16.3% market share Marico
leads the industry closely followed by 15% of Hindustan Unilever. The most popular brand in this
segment is Parachute Coconut Oil with a market share of 8.6% brand share.

India is a mass market where rural market contribute to 54% of the total sales in the industry, this
results in a market share of premium brands very limited to just 5.8% of the total market share.
Conditioners and hair treatment products remained the leading category within hair care in India
in 2017. There is a high share of conditioners and treatments in hair care since oils have high
penetration and fall under this category. There is a high popularity of using oil as hair conditioner
amongst both rural and urban consumers in the country.

The rising use of male grooming products are in trend and resulted in the growth of styling agents.
Styling argents in cream format remain the most prevalent, primarily due to the gaining popularty
of Brylcream brand (HUL). The popularity of styling agents in gel format also increased over the
2017-18, brands such as Park Avenue and Set Wet have been able to successfully attract consumers
with their hair gel offerings.

2. Herbal and Natural Products:

While natural cosmetics and personal care brands have been growing in popularity and certain
brands are performing well across Western Europe, the vast availability of natural-positioned
brands makes it hard for individual brands to gain significant share of the overall market. With an
increasing market share of natural segment in India and strong inclination towards herbal and
natural products, this industry is flourishing and has now taken over about a third on the Indian
personal care market.

Looking at the number of consumers who said that they look for natural/organic benefits in their
hair care, India, China and Indonesia scored the highest, with over half of the correspondents
seeking natural hair care in some cases. This makes for the case that most of the conventional
brands of consumer goods now have a parallel line of natural and herbal products.

9
Natural and Herbal segment especially the hair oil category is vastly benefitted with the growing
interest in natural and organic products. Major players within conditioners and treatments,
including Dabur, Emami, Bajaj, Marico, Patanjali Ayurveda and HUL, have wide assortment in
herbal product portfolios within hair oils, establishing the conditioners and treatments segment
within hair care more firmly. The trend in this segment is expected to continue as the income rises
and people get more conscious about the harmful effects of chemicals in their hair products.

3. Packaging of Hair Care Products:

Packaging is designing and creating an element to capture attention. Packaging has become of
utmost importance as one of the tool to grab customer attention in a competitive landscape. For
this reason, it is necessary to understand which factors influence a consumer purchase decision
when making a package of the product.

Major driver for the growth in beauty and personal care was consumer demand for convenience.
Thus, Flexible packaging was the most popular packaging style in 2017, making for 52% of total
beauty and personal care packaging unit volume sales.

In the report of euro monitor 2018, the trend of making the brand look more premium within beauty
and personal care helped drive packaging innovations. These innovations were aimed to make the
product more convenient to the consumer and also add value. To get the point of difference from
other brands many brands such as Forrest Essentials and Biotique packaged their products in glass
to offer a more up class experience.

In hair care category the packaging in India had the largest share of beauty and personal care, this
was because of the popularity of flexible plastic sachets within standard shampoos. This all leading
companies offer affordable one time use sachets for the rural and semi urban customers.

4. Fragrance of Hair Care Products:

In Indian hair care market, specific functions are crucial to the contemporary consumer and
fragrances play a decisive role in complementing functional benefits. The concept of natural and
herbal Indian herb extracts used traditionally is also very strong for fragrances in hair care.
Conditioners, salon hair care and shampoos have a high penetration and make up the bulk of the
market for fragrances.

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The Basic 5 types of fragrances used in the Hair care products are:
 Fresh and Floral: Indians tend to prefer refreshing and clean scents
 Exotic Gourmand: Aromas such as of nuts, soya, yogurt, butter deliver exotic experience
aimed at hair spa products
 Natural and Herbal: Herbal scents are associated with their efficacy and thus have a strong
influence on hair care
 Global: India following global trends and including fruity aromas in shampoo and
conditioner
 Fragrances for Men: Evolved fragrances that mix fresh, green, citrus, musk and floral to
create a sensorial experience

5. Purpose of the Study:

The urban markets are already penetrated and market share is high. Thus, to enhance total sales
companies are approaching new population for the Greenfield expansion i.e. rural population with
all new attractive attributes. Also, with more disposable income and customers becoming more
aware of the ingredients, companies are even focusing on making the products according to
specific needs of the consumers.

Many Companies are even aiming to increase their share of the market by introducing varied
products such as colourants, hair loss treatments, relaxants, styling agents etc.

The present study is to identify the factors influencing consumer buying behaviour of Hair care
products and helping get a better understanding of the psyche of the consumer to hack an effective
marketing mix for companies operating in this space.

11
 LITERATURE REVIEW
Researchers suggest that packaging and shelf placement of a product impacts the off takes of a
product. An appealing packaging combined with an eye level shelf space gives the brand the best
on floor promotion. Also, understanding the requirement of the customer and keeping the basics
right can turn wonders for any organization in this segment as shown by Marico.

Product characteristics, price, packaging, ingredients and positioning weigh in to make a hair care
product lead the industry. The major attributes that influence the sales of a consumer product are:

1. Packaging:
Kumar N.A., Joseph J. (2014) noticed that if a certain product fit in their need, they advance to
loyalists. Package size also had considerable impact. The younger population prefers attractive
packaging and design whereas the illiterates identify the brand based on colour. Silayoi P., Speece
M. (2007) in their study on impact of involvement level and time pressure found that visual
elements, graphics and shape/size, positively influence choice in low involvement products, while
informational elements tend to play a key role in high involvement decision making products.

2. Product Characteristics (Hygiene, Fragrance, Hair Friendliness):

Product attributes are the characteristics of products through which products are identified and
differentiated. In other words, product attributes are features of marketing strategy that customers
use to evaluate a specific good. Katiyar, A., & Katiyar, N. (2014) Rural consumers desire more
than just cleansing but deodorizing and moisturizing abilities from their soap but are also price
conscious. With advent of more private labels big brand have to re-look at their pricing strategy.
Shamsher, R., & Chowdhury, R. A. (2012) in their study mentioned that a well-known brand and
private label scored similar on quality, durability, price, availability, attractive packaging and
brand reputation because of laundry soap being a low involvement purchase. Smell and heath
hygiene were taken as key differentiators between the brand and private label of Bengal. Hawes
and Baker, (1994) mentioned that the most suitable product can be determined by identifying the
most important characteristics of the product to the consumer at the target market. Beaudoin et
al.(2000) identified twelve attributes that correlated with attitudes when purchasing apparel and
they are : good fitting, rugged, easy care, affordable price, comfort, quality, colour,
attractiveness, fashionableness, brand name, appropriateness for occasion, and range of styles
available.

12
3. Branding & Marketing
Aaker J. and Fournier S. (2000) in their paper used the interpersonal relationship theory to
formulate a framework for better understanding of brand personality. They ideated that creation of
a brand personality literally involves personification of a brand. Attribute such as brand character
and buying partner plays an important role in identifying the purchase behavior of a person. Also,
the brand personality construct has been accepted in marketing and advertisement practices.
Anandan C., Raj MSM, Madhu S. (2007) mentioned that if the preferred brands were not available
they would readily shift to an available product. It was noticed that they were brand shifters and
were dissatisfied if the products were overpriced (in perception) or unavailable. Mohan, B. C., &
Sequeira, A. H. (2016) in their study mentioned that brand association, brand loyalty, and
perceived quality by the customers have an impact on the overall brand equity of the brands. Also,
it suggests that brand equity is also dependent on the financial measure of the firm and market
share of the same. Madhavi C., Kumar S. A. (2006) Intensive marketing and promotion of generic
products was recommended to convert new customers. Katiyar, A., & Katiyar, N. (2014) in their
study mentioned that the rural consumer much like the urban consumer is able to differentiate
between the products and respond positively to marketing activities. Selvraj A. (2007) marked in
his research that convenience and ease of availability was driving force for buying non-durable
consumer products.

4. Quality & Price

Anandan C., Raj MSM, Madhu S. (2007) observed that the significant factor in the preference of
washing soaps in the rural markets was quality. Madhavi C., Kumar S. A. (2006) marked that
majority of the rural consumers were influenced by quality of the product, nearly followed by
price. Kumar N.A., Joseph J. (2014) found in their study on FMCG products like soaps, detergents
show that rural and suburban consumers are more concerned about quality, brand name and brand
benefits of personal care products. Garg P., Ghuman K. and Dogra B. (2009) research carried out
in Punjab marked that majority of the rural responses indicates that FMCG products with a better
price-value preposition were a preferred choice. Rural consumers look for value for money,
medium sized and moderately priced products. Hoyer, (1984) said that consumers also consider
brand satisfaction on the previous use of the product up and over the previously acquired
information about the product. Thus for many purchase situations extensive decision making
process doesn’t take place, because consumers are not inclined to think deeply about the low

13
involvement products. Although, in-store decision making during the purchase of laundry
detergent customers look out for the most price effective alternative. C Moungkhem, J
Surakiatpinyo (2010) observed that financial factor plays an important role on the purchase
behaviour of hair care products about men. Quality is the most imporatant element that men look
out for when purchasing a hair care related product.

5. Effect of Gender and Generation:

C Moungkhem, J Surakiatpinyo (2010) Observed that there is a change in the attitude of men and
how they approach products pertaining to appearance. It was seen that men consume more hair
care products in this generation as compared to previous generations. . Also, they stated that men
see themselves as most influential on their purchase behaviour irrespective of his marital status.
Imam, F. (2013). In his research found that females are more into impulse buying while men make
a more informed purchase hence the dissonance post purchase in men is lower than that of females.

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 THEORETICAL FREAMEWORK
To analyze the factors that influence a purchase decision of a hair care product and study the
influencers such as social factors, gender, product attributes and marketing mix following theories
have to be studied to be employed as a theoretical framework:

1. Four Ps In Marketing Mix:

A. Product: The products available at large in the hair care industry are colorants,
treatments, conditioners, shampoo, salon care packs and styling agents. Conditioners
that comprise of hair oil the dominant category by retail value. Companies provide all
the products in various packet size to cater to the wide variety of market. With growing
income the demand for styling agents (hair gel and creams) have significantly increased
and thus is attracting more interest of the companies in this direction.

B. Place: Sachet and small packets are a preferred choice in rural cities, thus most
companies operating in this space have to operate on volume and drive sales through
exploring new markets. The consumption of the product is evenly distributed among
the rural and urban population. With more organized retailers coming in the picture
lately companies are focusing on driving sales though smart product placement by
forming strong rotations with the retailers. Companies explore the conventional
distributor-retailer distribution model as well as online shopping platforms to penetrate
the market as far as possible

C. Price: Hair Care segment has always been on the brink of the price war, the stiff
competition makes it necessary for a company to keep its prices at par by adopting
competitive pricing strategy. Companies also follow penetration policy so that it can
reach towards new markets*and gain further*customers. The brands also advocates
promotional pricing strategy by offering discounts and incentives as sales resulting in
larger volumes and greater revenues.

D. Promotion: To reach the maximum audience with the cost per impression the least
companies prefer above the line promotional activities such as television commercials
and newspaper pamphlets. Also, they introduce various schemes to upsell and cross
sell the product by the use of product bundling. Out of home and digital media have

15
 also gained a strong share of marketing budget as the reach of digital platform continues
to grow.

2. Customer Behavior Theories:

A. Economic: The economic theories of customer behavior seeks to explain the
distribution of income by the customer. The two types of theories are:
 Utility Theory of Demand: This theory describes utility as the satisfaction of a
customer that comes from consumption (assuming it can be quantified). It also
states that the satisfaction towards a product declines with increased usage

 Indifference Preference Theory: Here, customer behavior analysis is done on

the consumer preference of combination of goods that is based on the nature of
the good and not on its ability to measure satisfaction

B. Psychological: This theory focuses more on the buying power of the customer and
focuses on the fact that usage of a product is dependent on the income and as the income
increases the rate of expenditure follows but with a slower rate

C. Psyco-Analytical: This theory based on the principles of Freud renders the personality
of the customer three aspects: the id, the ego, the super ego and the result of interaction
between these three form the customer behavior. “Id” triggers pleasure, super ego
pertains to the moral issue and ego is the in-between. There help the customers decide
whether to make a purchase or not

D. Socio Cultural: It labels man as a social animal and his/ her behavior is driven by his
peers, society and the cultural background he is in. This is the reason that regardless of
personal preferences, people try to blend in a society. This conformity gives the
marketers the chance to cluster their target audience and sell with inducing a sense of
belongingness

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3. Customer Decision Making Theory:

Fig1: Customer Decision Making Process

A. Problem Recognition: When a customer understands that there is a significant

difference between their current and ideal state of affairs. They reckon such
problems needs attention. In case of hair care products, customers might concern
about their hair and appearance and reckon that hair care products may help them
better their hair.

B. Information Search: After they recognize the need, since it being a low involvement
product category people generally resort to retail outlets for information search.
This makes availability and visibility key indices to get included in the customer’s
consideration set. Here Zero moment of Truth(ZMOT) that is the online search and
review of products for seeking information is done by the customer

C. Evaluation of Alternatives: At this stage, information acquired from stage 2 is used

to evaluate all product choices. The options are evaluated on the basis of perceived
value that the product if offering with respect to its price and the kind of purpose it
fulfils.

D. Purchase: On the basis of all the information available, relevant options are
assembled and compared to choose a product among them. In relation to hair care
market, variety and product lines need to be extensive for winning the order

E. Post Purchase: The post purchase is majorly dependent upon customers’ experience
of the product. If the product is satisfactory the purchase behavior for that specific
product gets routinized.

17
 RESEARCH METHODOLOGY
The purpose of this thesis is to understand the factors that influence the purchase decision of a
customer pertaining to the hair care products. To understand the same necessary information was
necessary from the customers who are the users of hair care products.
For the study I have collected data through primary sources. A questionnaire was adopted from
M.Chanintorn, S Jiraporn (2010 to collect data from all the participants, buyers and consumers of
hair care products having different education level, gender, spending capacity, and preferred
product and age.

1. Secondary Research: Secondary Research included understanding of the market scenario and
current trends in the market through the datasheets and analysis of hair care industry by Euro-
monitor. Also various research papers were studied to analyze the work that has been done in
this sphere and also identify the key factors pertaining to customer behavior. These factors
included price, quality, ingredients, fragrance, hair friendliness, ease of purchase, product
persona, past purchase experience, packaging, advertisements and sales promotions

2. Primary Research: The survey contained questions pertaining to demographic background of

the customer such as age, profession, gender and educational qualification. It also had multiple
choice questions about their monthly expense on hair care and preferred place to buy the
product. The factors identified through secondary research were tested on a 5 point likert scale.
The primary source of data collection was via online platform, the respondents were contacted
on personal basis with emails and messenger services. SPSS was employed to analyse the
collected data and identify the important influencers and factors impacting the buying decision
of a hair care product.
Target Audience: Respondents between the ages of 18-35 actively involved in the purchase
of hair care products, living in Mumbai city and suburban areas nearby.
Sample Size: Sample size was 102 (out of which 100 respondents said they used hair care)

3. Research Gap:
There is a clear knowledge that hair care is one of the most widely used fast moving consumer
goods but we have little information as to what factors influence the purchase decision of a

18
customer purchasing these products. Also, with the advent of a market that is more conscious about
the product is uses, little knowledge prevails weather this ingredient conscious consumer gives
packaging much importance and to what characteristics of packaging it responds positively. The
type of hair care products most preferred and the reason behind it is also not known which is being
addressed in this research

4. Objective
A. To identify the demographic profile of hair care products users in Mumbai region
B. To determine type of hair care products purchased by the customer and its level of
importance
C. To identify various reasons behind the purchase of hair care products
D. To identify the factors which influence the purchase behaviour of male grooming
products

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 ANALYSIS
The data of 102 respondents were collected out of which 100 said that they intend to use hair care
products and thus only their data has been analysed further
1. Demographic Profile
A. There was almost an equal divide in terms of gender, there were 49 males and 51 females
that responded to the survey
B. 57% of the respondents were young adults in the age group of 18-25, 28% were in the age
group of 26-30 and 13% were above the age of 35. 2% of the respondents were from 31-
35 age group
C. 50% of the total respondents were students, 24% salaried and 9% housewives. This
provided us with a broader perspective of consumer choice. Also, 16% of the respondents
were self-employed or had an entrepreneurial venture
D. 50% of the respondents were post graduate, 38% were graduate. School and Professionals
were 4% and 8% respectively
Characteristic Frequency
Gender
Male 49
Female 51
Age
18-25 57
26-30 28
31-35 2
Above 35 13
Professional Category
Student 50
Business 1
Salaried 24
Self Employed 16
Housewife 9
Highest Education
School 4
Graduation 38
Post-Graduation 50
Professional 8
Table 1: Demographic Profile

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 Place of Purchase Expense on Hair-Care
per Month
Organized
Retailers
Cosmetic Stores
20%
27% 23% Less Than 100
38% Internet/Direct
10% Sales 100-200

16% Medical Store 200-300

16% 26%
24% Above 300
Local Kirana
Shop

Fig2: Pie Chart: Place of Purchase Fig3: Pie Chart: Expense on Hair Care

2. Place of Purchase
A. There has been an inclination towards organized retailers in the urban educated user base
which can be seen as 38% of the respondents preferred to buy from organized retailers
B. The convenience that local kirana shop provides make them easily accessible and thus
20% of the respondents are seen to be buying from local shops
C. Rising startups and more indulgence of the customer in making a purchase is paving the
way for direct sales and internet sales which stands at 16%
D. Medical and Cosmetic stores at 10% and 16% respectively primarily function on the
specialized inventory they keep

Characteristic Frequency
Expenditure on Hair Care per month
Less Than 100 23
100-200 26
200-300 24
Above 300 27
Place of Purchase
Organized Retailers 38
Cosmetic Stores 16
Internet/Direct Sales 16
Medical Store 10
Local Kirana Shop 20
Table 2: Expenditure and Place of Purchase

21
 3. Expense on Hair Care
A. The expense on hair care products was evenly distributed.
B. More than 51% of the respondents said they spent above 200 per month on hair
care products. Shows that propensity to consume products of this category is high

4. Types of Products:
A. Below the table shows the preference of customers towards hair care products and
its level of importance
B. Hair Shampoo was ranked the highest with 31% preference
C. Hair oil followed as the second most preferred with 28.85% level of importance
D. Hair conditioner was ranked third with 25%
E. Hair styling category inclusive of hair wax and hair cream was ranked the last with
15.02%
F. Major inclination towards conditioners (oil inclusive) was shown by the
respondents

S. Not Somewhat Quite Extremely Critical

Product Total Percentage Rank
No. Important Important Important Important Importance
1 Hair Oil 7 11 7 37 38 388 28.85 Rank 2
Hair
2 Shampoo 4 2 12 37 45 417 31.00 Rank 1
Hair
3 Conditioner 8 15 29 27 21 338 25.13 Rank 3
Hair Cream
4 / Hair Wax 42 31 15 7 5 202 15.02 Rank 4
Table 3: Type of Haircare products and their level of importance

5. Reasons for use of hair care products:

A. Below the table shows the reasons of purchase of hair care products and its level of
importance
B. Personal hygiene was ranked the as the highest reason for customers to use hair
care products at18.8%, followed by the need to improve and restore hair at 18.5%
C. 17.29% of the respondents said they use hair care products for dandruff and hair
fall, this has been keenly noticed by product managers and almost all companies
have a product line to cater this need
D. Self Esteem was ranked at fourth position with 16.27%
E. Attractiveness was ranked fifth with 15.08%. Respondents hardly believe that using
hair care products would make them attractive
F. Medical reasons were the least rated at 13.97%. those respondents with a medical
condition prefer medicated hair care products else they use it for routinized use

22
S. Not Somewhat Quite Extremely Critical
Product Total Percentage Rank
No. Important Important Important Important Importance
For Medical Rank
1 Reasons 13 12 33 30 12 316 13.97 6
For Personal Rank
2 Hygiene 4 4 8 29 55 427 18.88 1
For Improving Rank
3 the hair 6 2 11 29 52 419 18.52 2
For Hair fall Rank
4 and Dandruff 7 6 15 33 39 391 17.29 3
For Rank
5 attractiveness 10 12 27 29 22 341 15.08 5
For Self
Esteem / Self Rank
6 Confidence 3 7 33 33 24 368 16.27 4
Table 4: Reasons for purchase of Hair-care products

6. Factors That Influence The Purchase Behavior of Hair Care Products:

The primary data is analysed using Factor Analysis, it is a statistical method used to describe
variability among observed values. This is a data reduction method used to measure the impact of
a few un-observed variables called factors on a large number of observed variables.

Results from Factor Analysis using SPSS

Kaiser-Meyer-Olkin Measure of Sampling

Adequacy. .643

Bartlett's Test of Approx. Chi-Square 627.984

Sphericity df 91
Sig. .000
Table 5: KMO and Bartlett's Test

Here, the value of KMO test in the above table is .643, it is between .5 and 1.0. Therefore, in the
primary data factor analysis is appropriate and can be used as a statistical tool to measure the
relationship between the set of interrelated variables.

Also in Barlett’s test of Sphericity, the value of r (significant value) = 0 in the table above.
Hence we conclude that there is a significant relationship in the variables. Respondents after
analysing the survey form found some of the variable related. Extracting these variables further
to analyse the groups in which they get divided.

23
 Extraction Sums of Squared Rotation Sums of Squared
Initial Eigenvalues Loadings Loadings
Compo % of Cumulati % of Cumulati % of Cumulati
nent Total Variance ve % Total Variance ve % Total Variance ve %
1 3.114 22.241 22.241 3.114 22.241 22.241 2.741 19.578 19.578
2 2.731 19.505 41.747 2.731 19.505 41.747 2.690 19.214 38.792
3 1.913 13.663 55.410 1.913 13.663 55.410 1.903 13.593 52.386
4 1.677 11.977 67.387 1.677 11.977 67.387 1.855 13.249 65.635
5 1.373 9.809 77.195 1.373 9.809 77.195 1.618 11.560 77.195
6 .669 4.779 81.975
7 .562 4.017 85.992
8 .455 3.252 89.244
9 .383 2.739 91.983
10 .312 2.225 94.208
11 .263 1.875 96.083
12 .206 1.474 97.557
13 .180 1.284 98.841
14 .162 1.159 100.000
Extraction Method: Principal Component Analysis.
Table 6: Total Variance Explained

This Table gives the Eigen values for the primary data sample. The Eigen vales displayed in the
factor analysis are decreasing in order moving from variable 1 to variable 14. The total variance
explained after 5 iterations is 77.19%.
The rotation method used for Varimax with Kaizer Normalization
Component
1 2 3 4 5
Past_Purchase_Experi
.858
ence
Price .840
Quality .831
Ingredients .768
Celeb_Endorsement .901
Advertisements .888
Sales_Promotion .848
Packaging_Logo .549
Product_Positioning .905
Brand_Name .894
Store_Location .938
Easy_Accessibility .932
Hair_Friendliness .880
Fregrance .878
Table 7: Rotated Component Matrix

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Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser
Normalization.
A Rotation converged in 5 iterations. The 14 factors that were asked of the respondents were
grouped by them in 5 as per the responses, and they are:
Factor 1: User Perceived Value

S No Variable Factor Loading

1 Past_Purchase_Experience 0.857724
2 Price 0.840148
3 Quality 0.830881
4 Ingredients 0.768495
Table 8: Factor Loading (1)

Table-7 includes factor loading values that reflect the User Perceived Vale like Past Purchase
Experience, Price of the product, quality of the product and its ingredients.

Factor 2: Promotions and Marketing

S No Variable Factor Loading

1 Celeb_Endorsement 0.90061
2 Advertisements 0.88838
3 Sales_Promotion 0.84802
4 Packaging_Logo 0.54908
Table 9: Factor Loading (2)

Table-8 includes factor loading values that reflect the Marketing and Promotion efforts Celebrity
Endorsements, Advertisements, Sales Promotions and Logo of the product.

Factor 3: Brand Value

Factor
S No Variable Loading
1 Product_Positioning 0.90495
2 Brand_Name 0.893999
Table 10: Factor Loading (3)
Table-9 includes factor loading values that reflect the Brand Value like Product Positioning and
Brand Name.In FMCG products consumers define the Brand Value of a product with the message
that the company put forth.

25
Factor 4: Purchase Source

Factor
S No Variable Loading
1 Store_Location 0.93825
2 Easy_Accessibility 0.932235
Table 11: Factor Loading (4)

Table 10 include factor loading values that reflect the purchase source like Store Location and
Easy Accessibility of products. Consumers give preference to ease of availability and sometimes
even consider retailer’s suggestion for product use.

Factor 5: Product Attributes

Factor
S No Variable Loading
1 Hair_Friendliness 0.879527
2 Fregrance 0.877934
Table 12: Factor Loading (5)

Table 11 includes factor loading values that reflect the brand attributes such as fragrance, and
hair friendliness (in case of hair care products). Consumers often select a brand based on the
product attributes which is often the USP of a specific product.
Cumulated
Factors Indicators Average
Past_Purchase_Experience
Price
User Percieved Value 4.35
Quality
Ingredients
Celeb_Endorsement
Advertisements Promotions &
2.89
Sales_Promotion Marketing
Packaging_Logo
Product_Positioning
Brand Value 3.45
Brand_Name
Store_Location
Purchase Source 3.46
Easy_Accessibility
Hair_Friendliness
Product Attributes 3.91
Fregrance
Table 13: Cumulated Averages

26
The above table 12 shows the indicators that have been grouped using factor analysis and their
combined analysis, the cumulated means provide an idea as to how these indicators affect the
purchase behaviour of customers of hair care products.
 User Perceived Value: At 4.35 average it shows that the perceived value by the
customer of a product must be particularly very high. He/she should be able to establish a
good value preposition that has been extended by the company. Also, the ingredients
must be of their preference to win an order
 Promotions & Marketing: At 2.89 average, most customers feel that promotions and
marketing of a hair care product does not influence their purchase decision much.
Celebrity endorsements, TV ads and sales schemes might not be able to make a deep
impact in the purchase decision
 Brand Vale: At 3.45 average, customers value the brand name a product carries and the
positioning it has in the minds of the consumer but is not something which can turn a
customer into a core user.
 Purchase source: At 3.46 average, customers feel there should be an ease in buying the
product but still can travel a little further if the perceived value is more elsewhere
 Product Attributes: At 3.91 average, product attributes are a major influencer of
customer buying behaviour, if a product has good fragrance, ingredients and hair
friendliness they are sure to choose that product over the competition

7. Findings:
A. There is a good and stable demand of hair care products in the market and
majority of the population spend more than Rs.200 per month on hair care
products
B. People tend to prefer either convenience or wide assortment and thus they choose
to visit either a supermarket or local kirana stores mostly. Wider the availability
better for the brand
C. Hair oil, shampoo and conditioner continue to be the most used product in the
consumer basket
D. Reasons for use of hair care products are mainly for hygiene and personal care,
followed closely by conditions like damaged hair or dandruff

27
 E. The 5 major factors that customers consider before making a purchase decision
are user perceived value, promotions & marketing, brand value, purchase source
and product attributes
F. Value perceived by the customer of a certain product hold the maximum
importance in forming a purchase decision
8. Recommendations:
A. Since people are willing to spend more on hair care, introduce premium products
and brand them as a need quenching solution
B. Wide spread distribution network is need for reaching the mass audience and rural
markets
C. Focus on the conventional products such as hair oil, shampoo and conditioners
and still in the market they only have a deep penetration
D. Focus more on product attributes, ingredients, price and distribution rather than its
marketing and positioning. Customers seem to value a genuine product more than
a marketing fad
9. Conclusion:
The Indian population is increasingly trying out new hair care products & services and
experimenting with new hairstyles and looks. The urban population, which is a favorite
segment of FMCG, doesn't think twice about trying new products and applying styling gels
along with all the conventional hair care routine.
As India is a very price sensitive market of consumer care and hair care products, the
companies have to look at various new product offering that can lure in new customers, by that
they are able to establish a ―niche market‖ for themselves.
Also, with increased spending ability customers have, companies need to build value in the
eyes of the customer to sell the products at a premium.
Rural markets are still a very large market and robust distribution system is the only way that
market’s true potential can be realized.
10. Limitations
A. Questionnaire was distributed in one city of Maharashtra that is Mumbai
B. Sample size was nominal which can be increased to gather a comprehensive view
of the customers.

28
 REFERENCES
1. Aaker J and Fournier S (2000), A brand as a character, a partner and a person: three
perspectives on the question of brand personality, Advances in Consumer Research,
Volume 22, eds, Frank R. Kardes and MitaSujan, Provo, UT: Association for Consumer
Research, Pages:391-395
2. Anandan C, Raj MSM, Madhu S (2007) a study on brand preference of washing soaps in
rural areas. Indian J Market 37: 30-37.
3. Garga P, Ghuman K, Dogra B (2009) Rural marketing of select Fast Moving Consumer
Goods in Punjab. Indian J Market 39: 21-27.
4. Kumar N.A. & Joseph J. (2014). A study on consumer behavior towards FMCG products
among the rural-suburban households of Ernakulam. Journal of Global Economics, 1524-
1530
5. Madhavi C, Kumar SA (2006) Rural Marketing 34: 30-35.
6. Selvaraj A (2007) Rural Consumer’s behavior regarding Non-Durable goods: A study in
Erode district of Tamil Nadu. Indian J Market 37: 35-39.
7. Silayoi P., Speece M.(2007). The importance of packaging attributes: a conjoint analysis
approach. European journal of marketing, 41(11/12), 1495-1517
8. Katiyar, A., & Katiyar, N. (2014). An empirical study of Indian consumer buying behavior
of FMCG products (with special reference of bathing soap). International journal of
management and commerce innovations, 2(1), 211-217.
9. Mohan, B. C., & Sequeira, A. H. (2016). The impact of customer-based brand equity on
the operational performance of FMCG companies in India. IIMB Management Review,
28(1), 13-19.
10. Shamsher, R., & Chowdhury, R. A. (2012). Relationship of demographic characteristics
with purchasing decision involvement: a study on FMCG laundry soaps. Cell, 1813,
202030.
11. Hawes, J. M. and Baker, T. L. (1994). “Retail Salesperson Attributes and the Role of
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Sales management, Vol. 13, No. 4 (Fall 1993), pp.61-71.
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13. Moungkhem, C., & Surakiatpinyo, J. (2010). A Study of Factors Affecting on Men’s Skin
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29
 ANNEXURE 1
I am a student of PGDM student of KJ SIMSR and I am conducting a survey on the impact of
various factors on consumer buying behaviour in perspective of hair care products. I request you
to kindly spare a few minutes and help me in the survey. Your co-operation will be highly
appreciated. This questionnaire is particularly for the completion of research and will be used for
no other purposes.
Name: _____________________________
Part 1: Personal Data
Q1 what is your gender?
 Male
 Female
Q2 what is your age?
 Below 18
 18-25
 26-30
 31-35
 Above 35
Q3 what is your professional category
 Student
 Business
 Salaried
 Self Employed
 Housewife
Q4 what is your highest educational qualification?
 School
 Graduation
 Post-Graduation
 Professional
Part 2: Consumption Data
Q5 Do you use any hair care products?
 Yes (If ‘yes’, continue further)
 No
Q6 where do you usually buy hair care products?
 Organized Retailers
 Cosmetic Stores
 Internet/Direct Sales
 Medical Store
 Local Kirana Shop

30
 Q7 How much are you willing to spend in a month on hair care products?
 Less Than 100
 100-200
 200 – 300
 Above 300
Q8 Do you think hair care products are more a woman than a man area?
 Yes
 No

For each of the items listed below, identified as studied determinants of hair care products’ consumption
behaviours. How important do you personally consider each of the following in your purchasing decision
making?
1 2 3 4 5
Not Important Somewhat Quite Important Extremely Critical
Important Important Importance
Please circle a rating indicating your perceived level of importance

Q1.The Consumption of Hair Care Products

A Hair Oil
1 2 3 4 5
B Hair Shampoo
1 2 3 4 5
C Hair Conditioner
1 2 3 4 5
D Hair Cream / Hair Wax
1 2 3 4 5
Q2 The reasons of using these hair care products

A For Medical Reasons

1 2 3 4 5
B For Personal Hygiene
1 2 3 4 5
C For improving the hair
1 2 3 4 5
D For Hair fall and dandruff
1 2 3 4 5
E For attractiveness
1 2 3 4 5
F For Self Esteem/ Self-confidence
1 2 3 4 5

31
Q3 The factors that influence your decision making

A Price
1 2 3 4 5
B Quality
1 2 3 4 5
C Ingredient
1 2 3 4 5
D Packaging and Logo
1 2 3 4 5
E Advertisements
1 2 3 4 5
F Sales Promotions and Schemes

F Brand Name
1 2 3 4 5
G Brand and Product Positioning
1 2 3 4 5
H Past Purchase Experience
1 2 3 4 5
I Fragrance
1 2 3 4 5
J Easy Accessibility
1 2 3 4 5
K Hair Friendliness
1 2 3 4 5
M Store Location
1 2 3 4 5
N Celebrity / Influencer Endorsements
1 2 3 4 5

32