MK101- MARKETING MANAGEMENT - 1

A Report on

Netbooks

By Section B Group 1
Apoorv Khandelwal 0065/48 Arnab Ganguli 0071/48 Aseem Mahajan 0078/48 Ashish Anand 0079/48 Dheeraj Kumar 0115/48 Dedeepya Srimanthini Malladi 0109/48 Vaishakh Nair 4017/18 Rahul Chaudhary 4021/18 Rinkesh Yadav 4024/18

Acknowledgements

Firstly, we would like to thank Prof. D P Ghosh for giving us this opportunity and helping us out in every possible manner in order to produce good results. We would also like to thank all our participants and our colleagues at IIM C who helped us in the execution of the survey required for this study. Group -1

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TABLE OF CONTENTS

Acknowledgements ............................................................................................................................................................... ii Table of Contents ................................................................................................................................................................. iii List of illustrations ................................................................................................................................................................ iv Introduction ........................................................................................................................................................................... v Chapter 1. Chapter 2. Chapter 3. Chapter 4. Objectives .......................................................................................................................................................... 1 Data Collection ................................................................................................................................................. 2 Data Analysis and Interpretation ................................................................................................................... Conclusion .........................................................................................................................................................

List of references ..................................................................................................................................................................

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INTRODUCTION This is a report on the Marketing Research conducted on Netbooks. An understanding of the Netbooks is a prerequisite for any for understanding of the report as this report contains the analyses that is based on the nature and the kind of the product. Points discussed Netbooks Report

NETBOOKS Netbooks are a category of small, lightweight, legacy-free, and inexpensive laptop computers. At their inception in late 2007 as smaller notebooks optimized for low weight and low cost Netbooks omitted certain features (e.g., the optical drive), featured smaller screens and keyboards, and offered reduced computing power when compared to a full-sized laptop. Over the course of their evolution, Netbooks have ranged in size from below 5" screen diagonal to 12". The product Netbook has become a major player in the personal computer market since the last 3-4 years. The initial Netbooks were very expensive and had a very small niche market space. But with the development of cheaper and more compact Netbooks which have sacrificed certain features such as optical drives for providing more functionality in a smaller and cheaper device, plus improved battery performance have made it a major challenger to the notebook. The sleekness of the product appeals to the young segment and its usage in classrooms has been a major driver in its sales. Business class customers have also been attracted by greater functionality as compared to a blackberry and ease of carrying as compared to notebooks.

REPORT This report is divided into the following 3 Chapters 1. Objectives of the Study This Chapter details the specific objectives of this study that act as the basis. 2. Data Collection The Details with respect to the Method of data collection, the sample size, sample selection will be discussed in this Chapter. 3. Data Analysis and Interpretation The findings of the survey conducted along with the complete analysis of the data that has been collected will be discussed. 4. Conclusion The chapter presents the entire study in a Nutshell along with the recommendations. CHAPTER 1. OBJECTIVES OF THE STUDY The primary objective of the project is to analyze the buying behaviour of potential customers of Netbooks and the strategies followed by companies to attract potential customers. More specifically to Find how the decision between a Netbook and a traditional laptop is made. The features that attract customers. Find how the customers arrive at final purchase decision by considering sources of information, reviews that influenced them etc. Also, taken into consideration will be the decision making process of the customer staring right from Need Recognition to the Post Purchase Behaviour and how the major player strategize to attract the customers. The next chapter details the Data Collection methods and the sample details.

CHAPTER 2. DATA COLLECTION The data required to meet the specific objectives of this research has been collected from various books, articles and survey. The details of the same follow Primary The primary source of information is questionnaire survey. The questionnaire was administered to a sample 100 participants. This sample includes teenagers, college going students and business users. Also, several dealers of Netbooks across Kolkata were contacted for the pertinent information. Secondary The secondary sources include the websites of various companies, user review sites, expert review sites and newspaper reviews of the product category to gather more holistic information. Sample Selection The sample was selected at random keeping in view the minimum number required under the categories are mentioned below: 1. Students 2. Working Sample size The questionnaire was administered to nearly 100 individuals of whom 93 best responses were taken into consideration. The details of the representative sample size follow Table 1. Sample size Total: 93 Students: 62 Female:20 Working:28 Male:73 Others:3 The following chapter discusses the questionnaire, the responses and the analyses of the same.

CHAPTER 2. QUESTIONNAIRE From the questionaaire , we have tried to understand the various steps of buying decision process through different questions Problem Recognition The questions are aimed at determining the needs for a netbook. This will help determine the needs depending on gender and occupation Information Search The questions are aimed at understanding which information source has the most impact on the purchase decision i.e. which is the most important influencer which affects the psyche of the potential customer Evaluation Of Alternatives A set of questions were aimed at determining the evaluation of alternatives on the basis of brand name, features and substitutes for netbooks. Through questions on the brand name we have tried to determine two factorsBrand Awareness and Brand presence in the psychology of the buying public From the other question we have tried to determine the features most customers prefer and factors influencing their purchase decision, this would help us in determining the specific choices amongst various differentiating factors across brands conveying information about how the product is positioned and whom it is targeted at. Questions on substitutes will help to determine the major competitors that can adversely impact the sales of netbooks. Purchase Decision Questions are aimed to determine the preferred point of purchase so as to conclude where should these company focus their sales efforts and also to gauge purchasing power and the perceived utility of the netbookalso demographic trends in preference for either pricing or more features and better quality. We also tried to determine which payment options suit the customers the most. This will help in determining whether offering options in payment time period or medium of releasing funds has any influence on purchase decision. We have also tried to understand the effects of occupation and gender on the above. Post-Purchase Behaviour Questions here are aimed at determining the importance of perceived service quality in coming to a purchase decision and also to understand the level of satisfaction of the consumers with the product.

CHAPTER 3. DATA ANALYSIS Sample Size Following are the division regarding the occupation of the survey sample

Problem Recognition The major factors that create a need for a netbook or its equivalent are in the following graph

Overall, word processing, web browsing and emailing are the major factors due to which consumers feel the need of a netbook. Other factors are internet connectivity, media processing, travel companion and gaming. We see a similar trend among students and working professionals vis--vis the three major factors for need recognition. Information Search We have considered four major sources of information: 1. Friends & Family 2. Advertisements 3. Media review 4. Prior Experience

Overall analysis

Overall, consumers tend to rely on friends, family and acquaintances for gathering information before making a purchase decision. We see the same trend when we investigate the student community and the working professional community. Information search based on occupation

Evaluation Of Alternatives & Purchase Decision 1. Preferred Brand Names Recall value of the preferred brand names are shown in the graph below. The respondents were asked about two preferences. The final statistic is calculated by assigning a weightage of 2 to the first preference and 1 to the second preference. Dell seems to be the most recalled brand. It is important to note the high percentage of cant say category, which can be treated as an indication of the lack of awareness about netbooks in the common people.

2. Aspects of Value Proposition The different aspects of value proposition were investigated and the result is shown in the graph below. We can see that superior product features, value for money and product quality rank very high among consumers when they evaluate the product while looking for alternatives

3. Place of purchase Overall analysis shows that more than half the people surveyed (53.33%) prefer to buy the netbook from an authorized dealer because the authorized dealer usually has access to the entire line of the brand and can order any model from the factory outlet if the customer expresses his interest in that model. Only 2 % of the people surveyed felt that they would buy the netbook through the internet which may be due to the fact that the consumer likes to have a feel of the machine before buying it and e-tailing doesnt give you that luxury.

We see a similar trend being followed by both students and working professionals.

4. Price Range Almost two-thirds of the total sample size has kept their price range between 15,000 and 25,000. This is the normal price range in which the present netbooks are sold. There has been no trend visible as the people have expressed their price ranges dependent upon the value addition that they expect from the netbook. If someone is buying a netbook for the brand and superior performance, he is willing to shell out more than 30k (18%) while those who are purchasing the netbook as an addition to their PC or laptop are not willing to pay more than 20k (34%) .Thus, there is no cluster formed in case of the customer price preference in case of the netbook.

Occupation wise Analysis

Nearly 40% of the student community surveyed has expressed its interest in buying a netbook in the price ranges of 20-25k. For the working professionals, this ratio falls down to 38%. It is also seen that out of the people who have showed their interest in buying a netbook priced above 30k, it is seen that 80% of them are students which

shows that the students are more interested in the newer technology and are highly brand-conscious as compared to the other sections which is clearly evident in the survey results.

5. Payment Options Overall Analysis

80% of the people surveyed have said that they would prefer payment through Credit or Debit Cards while there are 52% people who have preferred net banking and 58% who have chosen Cash. EMI is the least preferred option (30%) which shows that people do not want to feel the burden of monthly payments when making the purchase of a netbook. They want to get the entire payment done in a single payment.

Occupation wise Analysis

EMI 27% of the students have shown that they are willing to pay through EMIs while 37% of the working professionals are willing to pay through EMIs. The student community may want to get the payment done in the very beginning and they may feel that they will repay their parents once they start earning. The working professionals are willing to go the EMI way as they can no longer depend on their parents and hence if they

dont have the resources for a single payment, they would prefer paying some part of their monthly salary as EMI for the netbook. CASH- Out of the people surveyed, 55% of the students have expressed their preference in paying through cash while 65% of the working professionals have chosen cash as their preference. This is quite easy to understand as the working population is bound to have liquid cash to spend on the netbook. NET BANKING- The preference for net banking is around 50% for both the students and working professionals, thus there is no clear preference for net banking. CREDIT/ DEBIT CARD Almost 80% of the student community and 84% of the working professionals have expressed their interest in using the card option for payment. This may be due to the proliferation in the card issuances as well as the ease of payment since there is no fear of carrying cash, the burden of monthly payments or the technological handicaps that most people have when paying through net banking. Purchase Experience An overwhelming majority of those surveyed have viewed on time delivery of the netbook as a very important factor in their purchase decision while around 30% each have expressed abundant models for display, less paperwork in buying and ease of navigation as being very important. Thus, it is clearly seen that the people want to get the netbook at their earliest.

POST PURCHASE BEHAVIOUR After-sales services are highly valued by customers. It can be judged by the fact that more than 70% of surveyed customers have responded that after sales service can affect their decision and only 7% responded that it doesnt matter much. Good after sales service have high influence on sales and ensuring good service can be make or break point. Marketers must make note of this fact as good after sales service can differentiate their brands from others.

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The second question regarding post purchase behavior was to judge about customer satisfaction and loyalty. 63% of surveyed consumers responded that they will consider the same brand for further purchases and will also tell others about the brand. Only 13% said that they will again seek information about other products before buying next time. About 17% were indifferent between the two options, this information can be interpreted as that either they dont know about the product and brand, they will make their mind only after using the product. Substitutes to a netbook Overall laptops seem to be the most potential substitute for a netbook, mostly because a laptop comes with added features and the only disadvantage per say being the weight, which many consumers disregard compared to the added advantages

Occupation wise Analysis

Students seem to be equally favorable to all the possible substitutes, mainly they are ready to try out new things which make them favorable to traditional options like pc and laptop and modern options like tablet and smartphone. On comparison, working professionals are slightly inclined towards laptop and less towards the more unconventional substitutes

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Gender wise Analysis

Women are equally poised with respect to all the substitutes, whereas men are slightly more inclined towards a conventional substitute like a laptop

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CONCLUSION One of the key findings from this study is that the customers value the netbook quality, its product features and the value addition provided by the netbook more than the brand of the netbook or the accessories that it provides. The above finding is further accentuated by the result that there is not a single overwhelming leader when it comes to the brand preference for the surveyed population although it has been found that Dell is slightly more preferred than the other brands. The main use that the surveyed public has expressed in buying a netbook is internet connectivity for viewing the mail and word processing. The consumers value the opinion of their family members or relatives more than the advertisements or the reviews of a model given by the TV and print media. The price range that the consumers are willing to pay lies within the range of 20,000 - 24,999 which shows that more people prefer buying low-cost models rather than splurge on the high costing ones. The results also show that the younger generation i.e those who are currently studying have higher inclination towards buying high-end models which may be due to being more aware of the new-age technology which invariably leads to higher costs. The analysis of the payment factor has shown that EMI is one of the least preferred options while people like to use through cash or credit/debit options while net banking is more of a neutral option. The speed of delivery after purchase is an important add-on factor for the consumer. After sales service affects the consumer in his post-purchase behavior and since about two-thirds of the surveyed population has said that they will buy the same brand , it will lead to good word of mouth. Laptops still seem as a good substitute for the netbooks as well as with increasing technology and connectivity, tablets and smartphones are coming up as strong competititors.

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