Final Project

Market analysis of Health Drink segment in India

Chapter I: Introduction and Research methodology

1.1 General Introduction of the project

India is the world’s largest malt-based drinks market, accounts for 22% of the

world’s retail volume sales. These drinks are traditionally consumed as milk

substitutes and marketed as a nutritious drink, mainly consumed by the old, the

young and the sick.

The Health food drinks category consists of white drinks and brown drinks. South

and East India are large markets for these drinks, accounting for the largest

proportion of all India sales. The total market is placed at about 90,000 ton and is

estimated to be growing at about 4%. These Malt beverages, though, are still an

urban phenomenon.

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1.2 Objectives of study

a) To understand the current market of health drinks.

b) To understand the consumer preference for a particular brand.

c) To analyse the market gaps

d) To suggest a product to fill the market gaps.

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1.3 Scope of Study

The scope of this analysis is to study the current market for the various health

drinks and the segment they cater to. The study will also analyse if there is a need

for a new product which would fulfil uncatered segments and find how new

product can be positioned in the current competitive and agile market.

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1.4 Research Methodology

1.4.1 Formation of problem

Due to growing high end competition in the market amongst the established

health drink brands, there is a need to understand the consumer preference which

would help to analyse the market. There is a need to understand if there are

market gaps in the health segment in terms of lesser product options available.

This study was conducted to identify those gaps and suggest product options.

1.4.2 Collection of data (primary & Secondary data)

A group of 20 families were chosen. These families had 3 generations so

that all market segments are covered. In order to collect the necessary

information, questionnaire was setup to know the current preferences and

identify the NEED of the consumer.Primary data was derived from

experiences of retail chains, nutritionists to get the insight of the market from

different perspective.

1.4.3 Research Instrument

The research instrument used was questionnaire with closed and open ended

questions.

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1.4.4 Making Sampling Plan

Samples were selected on a common factor that they

consumed/recommended/sold health drinks.

- A group of 20 families which consisted of all three generations such that it had all

age groups (0-80 yrs).

- A group of 20 nutritionists who recommend Health drinks to their clients

- A group of 10 retail chains who sell Health drinks to consumers.

1.4.5 Research Limitation

The limitations of study will be due to limited sample size.

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Chapter II: Review of Literature

General Overview of Health Drinks in India

With people turning more health conscious, the non-carbonated beverage segment has

become one of the fastest growing and most exciting businesses at the moment. For some

time now, manufacturers have experimented with some of the formulation and taste

issues, offering the consumers better tasting, more healthful alternatives. Evolving from

drinks containing a hint of herbs or vitamins, beverages have become an important

delivery vehicle for efficacious amounts of ingredients.

The Rs 1,100 crore health food drinks (HFD) market, classified into two categories of

white and brown segments, has remained stagnant for the last several years despite

GSKCH (GlaxoSmithKline Consumer Healthcare) and Cadbury's attempts to activate the

category. While Cadbury's Bourvita has been at the forefront of the HFD market,

GSKCH has also been active. Apart from repositioning its Horlicks brand from health

drink to a fun drink, GSKCH more recently has launched its brown drink Boost in 100gm

sachets. GSKCH's Horlicks alone, as a white beverage, is believed to have an over 50 %

market share.(Palka et al,2004)

Available Health Food Drink in market can be considered as follows:

Bournvita

Horlicks

Boost

Complan

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Product Profile: Bournvita

Bournvita has been a market leader in the Health Drinks market

as well as have a dominant share of the Chocolates market.

Cadbury Bournvita was introduced in 1948. Since then, it has

always been the leading brown MFD brand in the country and the

second largest MFD brand as a whole. Bournvita has worked

towards achieving this status by never remaining motionless.

Throughout its history, Bournvita has constantly endeavoured to

re-invent its product, packaging, promotion and distribution.

Each has been aimed at improving the value proposition to the consumer.

The brand was re-launched in 1999 with a new fortified Recommended Dietary

Allowance (RDA) balanced formula. The message sent out through communication as

well as packaging simply stated that the ‘new Bournvita would meet the nutritional needs

of children and make up for any deficiencies in nutrition as a result of improper food

intake’. At the same time, the company strongly promoted the practice of consuming two

cups of Bournvita to ensure that this happened. The effort enabled the brand to create

greater relevance for the category – and hence the brand – amongst plain milk drinkers. It

was a winning formula that yielded double digit growth over the next two years and

significantly contributed to the brands’ development.

An energetic brand, Bournvita went through another change in 2001, with a complete

overhaul of branding, packaging and communication. This re-launch had two clear

objectives: to make the brand contemporary and reinforce the equity with its loyal

consumers. An assessment post the successful re-launch, showed that Bournvita had

further strengthened its leadership position in the West and had attained market

leadership in the North.

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Bournvita has a unique taste which combines the goodness of malt and chocolate. It gives

the child physical and mental alertness resulting in a healthy body and an active mind. In

turn this gives the child the confidence to succeed in life.

In 2001 Bournvita, complete with new packaging and design was re-launched. It had

many firsts. Bournvita introduced a pet jar (shifting from the old glass bottle). It

introduced shrink-sleeved packaging (from the old jar labels). There was a complete re-

design of the logo. A loyalty programme, in the form of a Bournvita Nutrition Centre,

dedicated to counselling mothers on her child's daily nutritional needs was opened. It was

Bournvita's way of showing it cared.

Brand Values:

The core values of the brand have been mental alertness and physical fitness for children

who consume Bournvita daily. This layered with the great Cadbury chocolate taste has

made the brand distinct from other offerings in the consumers mind.

Facts:

Cadbury Bournvita won an ABBY for its

press campaign - 'No Bournvita. No Milk'.

Bournvita was the official health drink for

the Indian team for the 1980 Moscow

Olympics.

The Bournvita Quiz Contest is India's longest

running national school quiz.

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Product Profile: Horlicks

Some malted barley, pinches of wheat

flour with a dash of evaporated milk.

That's Horlicks recipe for success.

James Horlicks, after whom the brand

is named, was a chemist who worked

for a company which produced dried

infant food. He became ambitious after

inventing some recipes of his own. So

along with his brother William, they

found J and W Horlicks of Chicago.

Up until the 1960s Horlicks was

positioned as an adult restorative drink that gave extra energy, especially during

convalescence. The 1970s saw its position shift to ‘The Great Nourisher’. It was in this

phase that the brand saliency shot up. The next decade saw Horlicks face an immense

external challenge. Thanks to Operation Flood, there was availability of milk and the

raison détre for buying the brand became weaker. Horlicks fought back. In 1984,

Horlicks aimed at growth by growing the consumer base. By 1994, it had created ‘Ideal

Horlicks’ – and improved product formulation that also brought back the taste people

reminisced about. In 2002, Horlicks was relaunched on the immunity platform.

Horlicks has a significant presence in over fifteen countries. Today Horlicks is the best

known brand in the health foods category in India. The brand enjoys the trust of

generations of Indian mothers and this relationship has been nurtured by the brand by

fortifying the product from time to time. In 1998, Horlicks was fortified with Smart

Nutrients – a unique combination of vitamins and minerals – intended to imbibe growing

children with mental agility and physical fitness. Junior Horlicks was relaunched with

extra nutrients to build the immunity of little children. Today, Junior Horlicks contributes

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11% to Horlicks’ total sales turnover and has been one of the fastest growing product

extensions to the Horlicks brand.

But it isn't just product development that Horlicks has concentrated upon. It has also

created new attractive packaging options including jars, refill packs and sachets. Horlicks

was the first brand in India to introduce a refill pack option and also the first to shrink-

wrap bottles. In a way, there’s a Horlicks pack for every occasion and mood.

Put a couple of tablespoons full into a mug. Add warm water or milk and you’re ready to

enjoy a drink that’s tasty and nourishing. Add ice cubes, cold milk or water to

reconstituted Horlicks and it turns into a delicious, thirst quenching drink on a hot

afternoon. That is why Horlicks is considered to be ‘the great nourisher’ for the entire

family. The medical credentials and heritage of the brand have reinforced the image of

the brand for years.

Junior Horlicks, a specialist brand for little children. Mother’s Horlicks, a special

nourisher for pregnant and breast feeding mothers, and Horlicks Biscuits are the other

forms in which the brand is available. A selection of flavours – including chocolate,

vanilla and honey – allow consumers to enjoy the nourishing goodness of Horlicks in a

variety of delicious ways.

Brand values:

Horlicks has always been a brand that stands for good health and nourishment through a

wholesome, natural product. A commitment towards product quality and reinforcement

of essential nutrients has won over the trust of generations of mothers.

The brand gives them the reassurance that they seek in caring for their family. Family

bonding is at the heart of Horlicks’ brand values. This, in turn reinforces Horlicks’ image

as a caring and trusted brand.

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Facts:

Horlicks was first invented to substitute milk as baby food.

In India, 2 billion cups of Horlicks are drunk every year.

People on special diet, including liquid diet or any diet devised for gastric

disorders, can benefit from the nutritional convenience of Horlicks.

Product Profile: Boost

Boost was developed by the GSKH

Indian R&D team in 1974 and

launched in Kerala in 1975/76.

Positioned as the 'energy fuel', the

brand soon generated great

consumer pull and was

subsequently launched at a national

level.

Around 1984, however, Boost sales seemed to plateau. This led to a complete re-think

about the brand strategy. A deeper understanding of purchase dynamics of the category

revealed that by the latter half of the 1980s, children had come to become strong

influencers in a family's purchase of these HFD products. What was also observed was

that this section of the population had the highest requirement for supplementary energy

and was also the most enthusiastic about sports - cricket, in particular.

Infused with this insight, Boost was consequently repositioned. It pushed forward the

association of kids of this age group with cricket. This has since remained a winning

strategy.

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Success for Boost has come as a result of constant brand building efforts and the proven

positioning platform of ‘energy’. The brand had the courage of conviction to make a

paradigm shift in targeting the child in its communication. Today, ‘Boost is the secret of

my energy’ is the most recalled ‘sign-off’ in its product segment and has defined the

brand's identity. Also, Boost is the first HFD to have ever used celebrity endorsement to

convey its proposition and has successfully carved out the Energy HFD market in India.

In recognition of these achievements, Boost has won prestigious awards such as the

World Star for its packaging and the finalists’ position in the Effie Awards, 2000, for

effective communication.

Boost is a malt-based drink in chocolate

flavour, with the brand philosophy being to

continuously innovate and pioneer changes

in the category. In 2002, the brand created

history by re-launching Boost with 'Power

Boosters™', a completely different product

from any other HFD. The New Boost

contains copper and biotin, in addition to its

extant composition of vitamins and

minerals. Two serves of New Boost

(approximately 30 gms) as per the CODEX

Alimentarius Commission of the World

Health Organisation, 1995, provide 50% of

the daily requirement of Vitamin B1, B2,

B6, B12, A, C, D, Niacin, Pantothenic acid, Biotin, Folic acid, Copper and Iron and 25%

of Calcium. The vitamins and minerals not only provide adequate energy for the

consumer they also help in the efficient working of body cells (by releasing energy from

food), formulation of healthy blood and make bones stronger. This re-launch has helped

Boost capture the position of number one brown HFD in India.

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Brand values:

The personality of the Boost brand is distinctly sporty and energetic and everything -

from the tone of communication to packaging - is done to reflect this vibrant energy.

Today, the colour red and 'Boost is the secret of my energy' have become synonymous

with the brand.

Facts:

Boost has a household penetration of 40%-45% in several cities and towns in South

India, the brand's stronghold. In towns like Chennai and Madurai this penetration

exceeds 50% among SEC A and B households and 40% among all households.

Sachin Tendulkar appeared in a Boost advertisement for the first time at the age of

seventeen.

The kid, who starred in the Boost advertisement with Kapil Dev, went on to become a

member of the Indian cricket team - Nikhil Chopra.

There is a range of interesting products prepared with Boost which cater to local

tastes: the Boost 'barfis', for example, in certain parts of South India.

Boost has the highest frequency of purchase among all brown powders in India

(Source: IMRB Household Panel).Boost is the fastest growing brand (2003 over

2002) among the top five Health Food Drinks in India.

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Product Profile: Complan

Heinz brought Complan to India in 1964 and marketed it through

doctors as a convalescence drink. After it went OTC in 1969,

Complan continued to be perceived as an ethical product. In those

days its tag line “Complan has 23 Vital Nutrients whereas Milk

has 9” had established Complan’s superiority over milk on

nutritional delivery.

The brands’ next major milestone was reached in 1975 when, in

order to expand its user base, Complan made a strategic shift in its target market and

positioning. Complan was now repositioned as an ideal nutritional supplement for

growing children.

Complan’s current consumer base runs into hundreds of thousands of households across

the country. It is retailed through more than 225,000 outlets and has an impressive 16.8%

share across the entire MFD category. Apart from India, Complan is also available in the

UK, Australia, Venezuela, Nepal and Sri Lanka.

Complan’s growth closely resembles its core consumers; it has been growing over the

last twenty years to register a constant upswing in its market. In this period, it has

doubled its market share while commanding a price premium in excess of 40% over its

nearest competitor.

Enriched with 23 vital nutrients in balanced proportion Complan is an ideal nutritional

supplement for children in its target segment of four to fourteen years. It is Heinz’s

constant endeavour to upgrade Complan’s formulation as per the latest d evelopments in

nutritional sciences and the changing requirements of growing children.

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Complan – the Complete Planned Food in a Drink – is formulated as per the World

Health Organisation (WHO) guidelines suggested for growing children.

Milk protein, which has superior digestibility properties, contains all essential amino

acids balanced to perfection and hence is the ideal engine for growth. It is also a superior

source of energy and meets the WHO guidelines of energy requirement from proteins. It

provides more energy (429kcal/100 gms) than any other major brand in this category.

20% of Complan is protein and 100% of it is derived form natural milk. No other brand

can match this claim.

To extend the goodness of Complan and make it available to children any time, the brand

was also conceived in a biscuit form. Complan Crunch Timers biscuits have nourishment

sandwiched in their cream centres and are a delightful anywhere bite.

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Studies on Health drink market in India

Abstract 1: Consumer Behaviour for Health Drink in India. (Bhardwaj,2008)

Till now we have seen that health segment is not restricted to milk or juices but the

changing life style has given different means to it for different people and at different

time. Moving to deliberately positioned health drinks which are categorized into white

and brown segment and as a whole forms Rs 1,100 crore health food drinks (HFD)

market. Despite the management strategy of GSKCH (GlaxoSmithKline Consumer

Healthcare) and Cadbury's attempts to activate the category, the segment is flat as a

growth curve. The strategic scenario is like Cadbury's Bournvita leads the HFD market,

followed by GSKCH , striving hard to invade the market. The Horlicks, originally

invented as a health drink for army men and then commercialized for mass is

repositioned as a fun drink.

GSKCH as usually like a challenger did not leave any stone unturned , more recently it

has launched its brown drink Boost in 100gm sachets as well in Tetrapak as a ready-to-

drink product. GSKCH's Horlicks and other brands like Boost, Viva, Maltova, together

have a 75 % share of the health food drinks market. Horlicks alone, as a white everage, is

believed to have an over 50 % market share.

GSK, to stronger its position in the health drink market worked the way internsindia.com

predicted. The brands were Viva, Maltova and Boost and key parameter was packaging.

Viva has been repositioned as a traditional family health drink while Maltova has been

repositioned as a tasty chocolate-based drink for children. Boost has also been

repositioned as an energy drink. They have covered the major segments fall in different

age group. GSK’s share in the market is around Rs 1,000 crore from four brands,

including Horlicks. Because of the repositioning, Boost's share in the market has grown

to 14 per cent from around 12 per cent last year. Horlicks' share remains steady at around

54 percent, including all its variants. While all segments of the beverage market are

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evolving, the growth seems to be directed more towards healthy, light and low-calorie

drinks, in particular organic and fruit juice varieties. Nestlé’s Milo, however, being a

brown drink faces direct competition from Cadbury's Bournvita and GSKCH's Boost.

The market has marginally moved from the white malted beverages to the brown

segment.

There is one thing common in all the brand positions, Guess What?

These brands are not repeating the mistake of Complain who tried to challenge the

existence of milk. All these brands positioned as a supplement health drink. Different

companies have different assumptions to trap its consumer base. Some believe in

targeting mothers and some believe in targeting the consumers (kids) directly. If you

track the life of a human being since first month after his birth till his death, you will a

pattern in the change of consumption behaviour and purchase decisions. Till the child is

of 2 years, Cereal is the favorite brand of a mother-a decision maker. Now the time

comes for schooling where Horlicks, Bournvita and Boost take up the preference of the

decision maker (again the mum) positioned as a supplement for growth.

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Abstract 2Abstract 2: Health Related Expenses (Srivastav et al, 2003): Health Related Expenses (Srivastav et al, 2003)

KSA TECHNOPAK has conceived an innovative product called Health Outlook 2003,

which provides strategic insights to consumer shopping and buying behavior. Apart from

the consumer insights, complete health profiling is also done for providing derived

disease incidence and prevalence in the country.

This Pan Indian research model provides large research depths by covering about 10,000

households across cities like Chandigarh, Delhi, Jaipur, Lucknow, Ludhiana, Calcutta,

Patna, Bangalore, Chennai, Cochin, Hyderabad, Madurai, Ahmedabad, Indore, Mumbai,

Nagpur, Pune and Surat. The rich respondent profile includes SEC A, B and C giving a

good coverage for demographic types.

Health Outlook shows that health enjoys about 9.4 per cent share of the wallet of Indian

consumer and is on the rise for the last three years. This spend includes health

supplements, health drinks, doctors and consultants fees, medicines, medical insurance,

regular check ups etc.

About 91 per cent of this was out-of-pocket expense and only 9 per cent came from

employers and insurance. Analysis of the consumer’s drug purchase behaviour shows that

59 per cent use old prescriptions and 29 per cent use over-the-counter drugs, meaning 88

cent of the consumers indulged in self-medication

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Abstract 3:Influence of Consumer attitudes on buying behavior for Health Drinks.

( Markand P ,2008)

Consumer attitudes to health drinks are mainly influenced by quality attributes. Ethical

factors are important in some cases, but they may be overstated. The relationships

between consumers' awareness of health drink, price and perceived quality of food were

investigated by tests involving series of consumer panels and sensory evaluation. Sensory

responses were also matched to instrumental analysis data. Results indicated that overall

there was no relation between panelists views about health drinks and their sensory

perceptions. Eighty percent of the panelists felt that organic products were too expensive,

but would buy them if they were cheaper. However the study showed that most of the

people would not be likely to change their preference once they had made a product

choice based upon sensory attributes. This has important implications, indicating that not

only price, but also sensory quality of health drink must be considered in order to

maintain repeated purchases by most consumers.

It is widely accepted that consumer acceptance of drinks is mainly determined by their

sensory perception, while choice is strongly influenced by the perceived value for money.

Ethical factors are important in some cases, but they may be overstated. Although

comparisons between organic and conventional drinks have been reported for a range of

attributes, measures of the quality of health drinks as perceived by consumers using

objective sensory evaluation methods, or the relevance of any preconceptions in

perception have not been studied. This study aimed to investigate the relationship of

objective quality measurements including sensory attributes and consumer perception of

organically and conventionally produced health drink products.

About two thirds of the consumers that participated in the survey believed that health

drink is good for the environment, and 55% thought that it is healthier. However there

was some confusion relating to the use of pesticides and chemicals in that. Few

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consumers’ distinguished health drinks by appearance or taste. Buyers of health drinks

were more likely to indicate that the appearance and taste are better, but environmental

protection was still the dominant perceived benefit. Buyers who believe that health drink

is better also think that it is expensive (p<0.05). In this study, 80% of the consumers

perceived health drinks to be too expensive (49% were non-buyers and 31% buyers)

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Abstract 4: Relationship between socio-economic characteristics of malted food

consumers and their brand preference (D. Muthamizh Vendan Murugavel ,August 2010),

.

The specific objective of the study was to analyse the consumers' satisfaction

towards malted food products.The area of the study is confined to

Gobichettipalayam town, Erode District. The study was conducted during April-

May 2009. In order to constitute a sample size of 150 respondents, 30 Business

People, 30 agriculturists, 30 employed people (both private and government), 30

housewives and 30 students were purposively selected.

The data collection method revealed following things:

Preference of brand was analysed:

As there are number of brands of Malted Food Products available in the

market, the choice of consumers is very difficult. Before purchasing a particular

brand, consumers consider several factors such as quality, price, availability etc.

The brand which satisfies them in all aspects would be purchased by them.

Brand Preference of Malted Food Products

Most of the sample respondents prefer to buy Horlicks as their most favourite

brand of Malted Food Product because Horlicks is identified as a more healthy food

to cater the needs of all age groups.

Period of Using Malted Food Product

The period of using the Malted Food Product may differ from one

another.One consumer may use a particular brand for its quality, price, vitamin

content, brand loyalty etc. If they get what they expected then they will use that

brand for a long time.

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Period of Using Malted Food Products

Most of the sample respondents were using the Malted Food Products for more than 1

year and less than 5 years.

Preference of Quantity of Malted Food

Product: Consumers may prefer their quantity of Malted Food Products by considering

number of family members, frequency of drinking and other brands used by them.

Preference of Quantity: Most of the sample respondent prefers to buy 500

grams pack because they want to use the Malted Food Product

freshly for a short period time, moreover the freshness shall be affected by

keeping these products for a long time.

Source of Information :The source through which the Consumers have received the

information about a particular brand plays an important role in modern

marketing. In this regard, advertisements play a vital role to describe about a

particular product. Advertising through various media has become popular now-a-

days.Most of the sample respondents are using the Malted Food Product b y g

etting i nformation t hrough advertisements

Frequency of Using: The reason why the malted food products are purchased by

the consumers is mainly for improving their health. Here, the frequency of

drinking of malted food products not only helps to improve their health but also it

increases the sales of malted food products.

Clearly states that most of the sample respondents are drinking the malted food

product twice in a day because it keeps them energetic throughout the day and

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also they feel very fresh while doing any work.

Type of Packing :A well packed product deserves more attraction and attention

than an ordinary one. Many buy products mainly only for its attractive packing.

The malted food products are in two type of packs i.e. Refill and bottle. The

consumer may prefer any one of these packs as they like. Refill pack is

preferred by consumer for convenience, free gift offers and economy where as

bottle is preferred for multipurpose means, less wastage, and attractiveness.

Preference of Packing: Majority of the sample respondents prefer refill

packs because it is more economical and convenient for handling

Source of Purchase:Easy availability of malted food product to the consumers is an

important factor to be considered. Non-availability of malted food products in

the purchase sources can lead to preference o f o ther alternatives by the

consumers.Majority of the sample respondents are purchasing the malted food

product from Department Stores.

Factors Influencing Brand Preference of Malted Food Products

Malted food product consumer may prefer their brand by considering

various factors such as price, quality, taste, vitamin content, freshness, discount,

reusability and free gift.

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Factors Influencing Brand Preference of Malted Food Products

Malted food product consumer may prefer their brand by considering various factors

such as price, quality, taste, vitamin content, freshness, discount, reusability and free gift.

Out of the various factors, Quality and Vitamin Contents is being considered as the main

factor which influenced them to purchase the malted food product and it is ranked first with

the highest weighted score of 1082. Getting energy in these malted foods are also considered

equally important by the consumers and it fetched second rank.

Conclusion of the study was Malted food product industry is ever growing and ever wanted.

All people want good and energetic health and ultimately they are depending upon some

energetic drinks in addition to taking normal food items. Based on the findings of this study,

various suggestions are given. If these suggestions are properly considered by the

manufacturers of Horlicks, Boost, Complan and Bournvita, fruitful results may be achieved

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Market Analysis for health drinks segment in India

Abstract 5: A Behavioral Analysis on Consumer Decision making

Venkateshwaralu et.al, conducted a study to analyse the buyer behaviour

towards biscuits. T hey h ave c oncluded t hat t he consumers prefer packed

biscuits to loose ones considering the product. Regarding decision- making,

though both parents and children are equally involved, the influence in majority of

the cases is the child. About 76% of the sample respondents purchase atleast

once in a week. Finally they have concluded that marketers have to give

considerable importance to taste, freshness and Brand name as these three

together would influence the decision making process.

Abstract 6: “Instant Coffee Market”,

Jagdish Kunte in a case study on Instant Coffee Market conducted with the

objective to analyse the impact of marketing strategies adopted. They have

concluded that higher promotional expenditure, better quality, strong brand

loyalty, s atisfying the c onsumer expectations were the reasons for higher

sales.

Abstract 7: A study on Buying Behaviour for Branded Fine Rice

Sanjaya Gaur .S and Shaiesh .J, in their study of Buying Behaviour for branded

fine rice have selected Chennai and Coimbatore cities of 200 households from

Chennai city and 250 households from Coimbatore city by simple random

sampling method. They used percentage analysis and Garrett's Ranking Techniques,

with the objective to know the factors influencing brand and level of satisfaction

in the purchase of branded fine rice. They could be inferred that the quality and the

brand image were ranked as the major factors for brand preference.

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Abstract 8: Buyer behaviour - case study: influence of children on buyer behaviour

(www.euromonitor.com)

Research suggests that children are exerting more influence over family buying decisions.

What are the implications of this for retailers, brands and marketers?

Children are an important part of the family buying process. But what roles do they play?

Marketing theory suggests five main roles in a family buying process:

- Initiator

- Influencer

- Decider

- Buyer

- User

Which roles do children play in addition to the obvious one – “the user”

Children certainly influence family buying decisions from cars to holidays. They are also

the buyers of the future. Provide children with Penguin bars and McVitie's may be able to

hold on to the adult due to brand awareness and brand loyalty formed at such an early

age.

But how should businesses market to children? Are there conflicts with being seen to

specifically target the child audience – can it alienate parents?

Products have to appeal to the conflicting agendas of child and parent, while fighting off

increasing competition. A marketer of children’s foods was recently quoted as follows:

"Ten years ago children wouldn't have given a damn about cheese. It used to be just

Dairylea, but now children's dairy products encompass everything from cheese to

yogurts, and fromage frais. Our brands also face more intense competition than ever and

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it's not just from other chocolate biscuits - it's from products such as Dairylea Dunkers

and Fruit Winders. These things didn't exist before."

Marketers also have to recognise that children are moving into new markets. Children as

young as seven buy DVD's, and no teenage lifestyle is complete without a mobile phone.

This has a knock-on effect. For example, the money children spend on mobile phone

cards reduces the money they spend on snacks.

Marketers also need to be sensitive to the peculiarities of children-related markets. It may

be tempting to use a daring marketing campaign to make a product stand out. But a

poorly thought-through campaign could result in the product and/or brand being attacked

by ethical campaigners, outraged mothers, educationalists, health and safety organisations

and others.

A good example of how things can go wrong is Sunny Delight. Sunny Delight enjoyed

boom sales after its initial launch. However, the drink's popularity crashed when the

media realised that it was sold from chiller cabinets purely as a marketing ploy to make it

seem fresh and, therefore, healthy. The actual product formulation was far from healthy.

Retailers face a challenge to display products in a way that attracts children. Promotional

displays have to be able to handle child usage (or abuse) and capture a child’s

imagination and attention.

Disney has a reputation as being particularly good at interactive promotional marketing.

Many children also prefer Woolworth's to supermarkets because of features such as pick

'n' mix sweets. The Early Learning Centre succeeds by creating a playground which

allows children to play with toys rather than leaving them wrapped in plastic.

- 27 -


Chapter III: Data Analysis and interpretation and Findings

The data was collected by use of questionnaire. In total 20 families which included all

three generations were interviewed. The interviewee was female of the family who also is

the buying decision maker. Also ten leading retail chain managers and twenty

nutritionists were interviewed to get an overview of the health drink segment. The

findings of the study are:

DETAILS OF THE SAMPLE:

Income Group

Category Criteria

Low Income 1-5 lakhs/annum

Medium Income 5-10 lakhs/annum

High Income Above 10 lakhs/annum

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Fig 1: Income group of Families


Age of Correspondents

The mean age of correspondent is 33 yrs.

Details of Study population

Males

The entire male population follows sedentary lifestyle.

- 29 -

Age Group No of correspondents Percentage

25-30 5 25%

30-35 8 40%

35-40 7 35 %

Age Group Working Retired

20-30 3

30-40 15

40-50 5

50-60 2 1

60-70 3 5

70-80 7

Above 80 1


Ailments

Out of the total male population of 42, 23 % are diabetic whereas 28.5 % suffer from

Hypertension. It is seen that age advances the number of diabetic cases increase.

But Hypertension incidences are seen in early 40’s.

Females

Lifestyle:

Out of entire female population 33 % follow a sedentary lifestyle whereas the rest

of 66 % are moderate in their lifestyle.

- 30 -

Age Group Diabetic Hypertensive

40-50 1 4

50-60 1 2

60-70 5 2

70-80 3 3

Above 80 - 1

Age Group Housewife Working

20-30 1 6

30-40 10 2

40-50 1

50-60 5

60-70 7

70-80 - -

Above 80 1


Ailments

Out of the total female population of 43, 16 % are diabetic whereas 20 % suffer from

Hypertension. It is seen that age advances the number of diabetic cases increase.

But Hypertension incidences are seen in late 30’s

Children (0-15 yrs)

- 31 -

Age Group Diabetic Hypertensive

30-40 1 2

40-50

50-60 3 2

60-70 3 3

70-80 - 1

Above 80 - 1

Age Group Girls Boys

0-5 6 1

5-10 6 3

10-15 2 4

Fig 2: Distribution of Girls & Boys in the total population


Health Drink Consumption Pattern

Out of total population of 98, 50 individuals consume health drink on a daily basis

Only 40 % of the male population consumes health drink on a day to day basis.

Horlicks is preferred by 29% of the total males consuming health drink whereas the

rest prefer Complan.None of the adults drink Boost or Bournvita.

Only 11 % of the female population consumes health drink on a day to day basis.

This highlights the fact that a female doesn’t like to spend much on herself when

maintaining health is concerned.

- 32 -

Fig 3: Health Drink Consumption Patter -Males

Fig 4: Health Drink Consumption Pattern -Females


Health Drink Consumption Pattern - Children

Entire study population of kids consume health drink on daily basis. It forms a

primary part of their dietary needs.

.

The above data analysis explains that in a family the health drinks are majorly consumed

by kids or adults who have a particular ailment.

Through the questionnaire, the correspondents were also asked why they prefer a

particular drink. The feedback highlighted following findings:

1) Adults who either are diabetic or hypertensive is been recommended Complan by

their nutritionists/doctors as it builds up stamina in them.

2) 85% of females who consume health drink buy Women Horlicks as that is only

known option available for adult women.

- 33 -

Fig 5: Health Drink Consumption Pattern -Kids


3) Majority of kids aged below 5 yrs were given Junior horlicks as their mothers were

impressed with the DHA/brain development claims they make.

4) Kids aged between 5-10 yrs preferred Boost as they liked the chocolatey taste it

renders

5) Most of the adolescents aged between 10-15 years consume Complan as it spurts

height growth

The trend of consumption or preference of a particular brand is more dependent upon the

perception of the brand from the customer’s end which is influenced by the promotional

campaign of the company.

- 34 -


RETAIL CHAINS

The questionnaire for Retail Chain was taken to managers of ten leading retails chains as

they could be helpful in marking the trend of consumer buying practices and the market

segmentation of the health drinks.

The ten leading chains are:

Reliance,

D Mart, Mumbai

Spinach, Mumbai

N Mart, Delhi

More, Mumbai

Star Bazaar, Thane

Food Bazaar, Mumbai

Apna Bazaar, Thane

Hyper city, Mumbai

Mega Mart, Bangalore

- 35 -


All of the retail chains regularly stock the 4 leading brands –Complan, Horlicks,

Bournvita and Boost. They were then enquired about the fast moving brand/the brand

consumers usually pick up from shelf. The response was as below:

The figure 6 clearly notes that Horlicks is considered the fast selling brand amongst other

health drink available .Retail Chain Manager attribute this fact to better promotional

campaigns and advertisements on part of GSKCH.

NUTRITIONISTS

- 36 -

Fig 6: Fast selling Drinks at Retail Chains


In today’s health conscious population, the role of nutritionists is very influencing on the

buying and consumption pattern of individuals.Considering this ,20 nutritionists were

interviewed using a structured questionnaire.

Experience of Nutritionists

Type of Patients visiting

Category Number Common ailments reported

Kids 35% Loss of weight ,Loss of stamina

Young Women 15 % Stress related disorders

Middle age women 30 % Menopausal problems like joint pain and back pain

Middle age men 10 % Loss of energy and stamina

Elderly men 10% Loss of energy due to Special conditions like

diabetes/hypertension

Recommendation of Health drink

- 37 -

Fig 7: Experience of Nutritionists


The above Fig 8 reflects the Nutritionist’s recommendation to the

patients/clients that visit them for consultation.For kids ,Bournvita DHA or

Horlicks DHA are the common recommendations to encourage overall

growth. Young & Middle age women are recommended Women’s horlicks to

address issues like High stress ,Menustral & menopausal issues.Loss of

stamina & energy is the common thread between elderly and middle age men

which is combat by recommending Complan.

Preference of a particular Health Drink

All of the above data collected from Families, Retail Chains & Nutritionists

chart outs some common reasons for preference of a particular brand by the

buyer. These preferences are influenced by experience of using the brand for

long or the positioning of the brand by the manufacturer. The common

reasons for Brand preference are highlighted in the next sheet.

- 38 -

Fig 8: Recommendation of Health drink for patients


- 39 -

Only available drink for adults

Builds stamina

Helps in overall growth of kids

Helps in Brain development

Splendid taste of Cadbury Chocolates

Trustworthy Brand for years

Splendid Chocolatey flavor

Boosts Energy

Brand Ambassador - Sachin T

Helps in Brain development

Enhances height growth

GSKHC has a good repute


Need for new product in market

All the questionnaires included a common question to know if Mothers, Retail chain

managers and Nutritionists feel the need of a new product in the health drink segment

which can fulfil the uncatered needs of consumers.

According to the data collected, 80 % of the mothers and 100 % of retail chains &

nutritionists felt that there is a need and scope for new refreshing product in the health

drink market.

When asked about the attributes they would like to suggest in the new drink, the few

common points highlighted were:

1) Health drink especially for adults

2) Health drink which can also be consumed in Summer for kids

3) Health drink which can be consumed in cold water.

4) Better & new flavors than the common chocolate one for teenagers

5) Health drink rich in calcium and iron for menopausal women

6) Health drink enriched with Natural fruits

7) Low sugar/no added sugar health drink

8) Health Drink which enhances immunity in kids and they don’t fall sick often.

9) Health drink for women that is cost effective as they don’t spend much on

themselves.

10) Health drink that can be purchased and consumed directly while traveling.

- 40 -


Chapter IV: Conclusion

The study was conducted to fulfill the objectives laid out in the research methodology

and it was achieved successfully. The study conducted highlighted that every Brand in

market has developed its own segment of loyal customers who stick to the brand due to

their good perception of the brand and the brand’s goodwill which comes from specific

positioning. The market is full with leading brands that face a cut throat competition.

These different brands cater to 3 segments: Kids(0-15 yrs),Adults(15-60 yrs) and Elderly

(above 60 yrs).These are the main segments which are further subdivide by gender and

ages.

Findings

During the study,the researcher realized that consumer preference of a particular depends

upon their perception of the brand which is in turn dependent upon the brand positioning.

Complan is considered as drink fit for all ages which builds up stamina and energy.

Horlicks is preferred by Young women (Women Horlicks) and Mothers trust it for

enhancing brain development in their kids.Bournvita DHA also fits into the need for extra

memory power by mothers and its blend of nature and science is an instant hit with

Mothers.Boost is liked by kids as it has a universally accepted Chocolate flavor.

The role of nutritionists cannot be neglected as it plays a major influencer on buying

behaviour of consumer.Nutritionists recommend helath drinks alongwith a complete

balanced meal.Health drinks are regularly consumed by the patients visting the

nutritionists as it is recommended by doctors/nutritionists.This aspect adds value to the

brand.Brand perception amongst nutritionists is similar to the consyumer group but is

result of a weighed analysis of different attributes.

The study concludes that there is growing need for Health drinks and they are becoming a

part of every urban household. The educated mother has become improvingly aware of

- 41 -


the additional needs of her family in the extreme competitive world. Still due to

conservative thoughts, she doesn’t spend much on her health as much as she spends on

her family’s health.

Further scope of study

There is still some scope to conduct a further study on

a) Rural market segmentation for these Health Drinks

b) Structure sampling based on age and income group.

c) Consumer’s Response to promotions by Health drink majors and its influence on

buying behaviour.

- 42 -


Chapter V: Recommendations

During data collection the correspondents were asked to suggest the key attributes they

would like to see in the new health drink segment product.

Varied responses were gained from different segments as listed earlier in data

interpretation.Based on these responses,would like to recommend development of a

product with variants

- 43 -


Marketing Strategy:

These key attributes:

Natural fruits will provide additional options for kids to consume the health drink in

summer

Improved body and dispersability will enable an adult to consume it in cold water.

Immunity builders will keep the diseases away from the kid and he will not fall sick

often

- 44 -

Health Drink

Improved Body and Dispersability


The product can be then marketed as “A single drink for all age groups”.A homemaker

will always relate to this concept as then she will not be required to but 3 different brands

for the entire family.

A consumer will be able to drink this in water/milk,stay away from diseases (as it has

immunity enhancer) and the natural fruits extract will help him cope with his vitamins

and mineral requirement.

There is a growing need to diversify and custom make a health drink for different

segments of the adult population as they are the ones who neglect own health.Maybe kids

are more vulnerable but their nutrition is closely monitored by mothers.In the due course

a mother’s health is most neglected one.

- 45 -


Chapter VI: Annexure

Questionnaire for Consumers

……………………………………………………………………………

o Name :

o Age

o Income Group

High Income (above 10 lakhs)

Medium Income (5-10 lakhs)

Low Income (1-5 lakhs)

o Family Member Details

Sr no Name Gender Age Occupation Lifestyle Ailments

1

2

3

4

5

o What type of beverages/drink does your family consume?

Name: (for each family member)

- 46 -

Health Drink

Kids Nutrition

Protein Rich

Special Condition

Specify the brand


o Apart from above do you think there is a need for another type of beverage in market?

o If yes, please provide suggestions.

- 47 -


Questionaire for Retail Chain

……………………………………………………………………………………………

o Name :

…………………………………………………………………………………………

o Do you stock Health Drinks?

o Which brands do you stock

o Which of the variants are fast moving?

o Do you come across specific requests from customers which are not currently

available?

- 48 -


Questionaire for Nutritionists

o Name :

o What type of patients are frequent visitors?

1) Kids

2) Women- Young/Middle age/Elderly

3) Men- Young/Middle age/Elderly

o Which ailments/conditions they come with?

o What are the common reasons for these ailments?

o What are your common prescriptions of health drink?

o Why do you suggest above?

o Is that the best available option or do you feel the need for some better product?

o What attributes the product should possess?

- 49 -


Chapter VII: Bibliography

Publications:

Bharadwaj Siddhartha (Sep 2008),Consumer Behavior in health drink , Economic

times,The Times of India publication,Mumbai

D. Muthamizh Vendan Murugavel (August 2010), A Study on Consumers' Attitude

towards Malted Food Products with Reference to Gobichettipalayam Town, Journal for

Bloomers of Research, , Vol. 3, No. 1

Gaur Sanjaya.S and Shaiesh .J, “A study on Buying Behaviour for Branded Fine

Rice, Indian Journal of Marketing, 32 (2002) 3-8.

Haripuram Venkateshwaralu, Kishore Kumar. M., Rajanath. K ((1987), “A

Behavioral Analysis on Consumer Decision making”, Indian Journal of Marketing,

Vol 8 3-9.

Jaiswal Kaushalya (Nov 2009),Indian Health Drink Market, Field &

Focus,Delhi,www.reportbuyer.com

Kunte Jagdish. M., “Instant Coffee Market”, Indian Journal of Marketing, 5 (1987)

29

Markand P (2008), Influence of Consumer attitudes on buying behavior for Health Drinks,

Marketing Biz,Fortune Publishing House,Delhi

Nair P N V (May 2007), The growing fruit juice and health drinks market & B

News,Mumbai.

- 50 -


Palka Apoorva (2004), “Consumer Preferences in Purchase of Health Drinks”, Indian

Journal of Marketing, September, 9 (2004) 34 - 35.

Samajdar Sabyasachi (June 2006), Top Indian health drinks,F & B specials,New delhi

Srivastava K,Mehta R,Jugani L(2003),Health Outlook report,KSA technopak,Pune

University

.

Websites

http://www.euromonitor.com/health-and-wellness-in-india/report

http://tutor2u.net/business/marketing/casestudy_%20buyers_children.asp

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Documents

Final Project