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Subhash C. Kundu
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Keywords
Packaging, consumer behaviour, rural
consumers, impact of package, India.
Correspondence
Subhash C. Kundu, Haryana School of
Business, Guru Jambheshwar University of
Science & Technology, Hisar 125001,
Haryana, India.
E-mail: sckundu@yahoo.com
doi: 10.1111/j.1470-6431.2007.00629.x
Abstract
This study aims to establish whether the residential background of consumers has a varying
influence on their buying decisions. A survey of 1090 urban and rural respondents was
carried out of which 523 were rural and 567 were urban. The gathered data were analysed
by applying counts, percentages, means, and analysis of variance. Rural residents found
that packaging is more helpful in buying, that better packaging contains a better product
and that they are more influenced by the ease of storing a package than their urban
counterparts. Ease of carriage, package weight, simplicity, transparency and similarity of
packaging have comparatively less impact on purchase decisions of rural consumers than
urban ones. However, rural consumers are more critical about packaging as they strongly
consider that it contributes to misleading buyers and is also an environmental hazard.
Introduction
Literature review
Package/packaging
The shampoo bottle cap that drops on the bathroom floor or down
the sink. The jam bottle refuses to open as per the instructions. The
flour (atta) that goes stale because the inner bag tears or does not
reseal securely. The last bit of toothpaste or shampoo that is
retrievable only by balancing the bottle upside down for a while.
These are few examples of packages that do not always do what
you want them to do (Alsop and Abrams, 1986).
Packaging is a key component of marketing, according to recent
studies by the Point of Purchase and Advertisement Institute
(POPAI), which indicate that 70% of consumers buying decisions
are made at the point of sale (Parker, 1997). Pandey (2005) also
claims that impulse purchase is increasing rapidly. The package is
a very effective tool for influencing impulse purchasing (Sehrawet,
2002; Sehrawet and Kundu, 2003). Further, Kundu and Sehrawet
(2002) showed that consumers feel that the package is very helpful
in identifying and distinguishing products.
As people become time poor, they are more prone to impulse
buying. The unplanned purchase is a large source of revenue. The
power of the package is an important element of unplanned purchasing. The concept of retailing has virtually been rewritten and
brands jostle for space and recognition in the crowded and over
populated shelf. Packaging is now in an era where communication
and display are still not valid value additions by themselves. The
package has to promote, emote, glamorize and enhance the value
of the contents (Sivan, 2000). This trend in marketing represents a
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd
Impact of packaging
companies operating internationally is that they give highest priority to product quality followed by packaging and design.
Approving the impact of the package on buying behaviour of
consumers, HLL has very recently repositioned their toilet soaps
Liril and Lux (which had a stagnant market for some past years).
To achieve this HLL changed its promotion campaign, product
formulation and most importantly its packaging (adopting global
packaging for Lux) (Bhushan, 2005). However, the general
perception is that the package will have a different influence on
buying decisions of different product categories and may vary
according to the gender of the buyers too. A study conducted by
Sayulu and Ramana Reddy (1996) among rural households finds
that in case of items like groceries (42%), toiletries (61%),
cosmetics (63%), utensils (44%), vegetables (45%), etc. the house
wife dominated the purchasing process; while the husband dominated in case of items like tobacco (79%), foot wear (68%), medicines (39%); in the case of expensive items like clothes (50%),
electric appliances (53.51%) both husband and wife were involved
in the purchase. Shampoos and packaged biscuits are two good
examples of rural Indias hunger for branded products. In comparison with 13.3% penetration of shampoo in 2000, today, a third
of the rural population use shampoo (Mahalingam, 2007). Sachets
of affordable price points are being pushed by the companies like
HLL and CavinKare in the rural market. Today, 86% of all
shampoo sales in the rural markets are in the form of sachets. In
urban areas, this figure is 69% (Mahalingam, 2007).
Ramaswami and Namakumari (2004) argue that it is necessary
to assess the reaction of consumers to a package periodically and
adapt it accordingly. Consumers may have their own preferences
covering: (a) package size; (b) package shape; (c) packaging
materials used; (d) package graphics, etc. Marketers must assess
consumer preferences on the one hand and cost and availability
aspects on the other hand, in order to provide the consumer with
the best possible package. An effective package can be an efficient
mass-selling medium and it is often worth more attention and
money that are now devoted to it by most companies.
According to the study of Alsop and Abrams (1986), 19% of
consumers refused to buy the brand in a poor package again, while
24% said they would buy it cautiously or in a different type of
package. Their research further revealed that most important
package characteristics to consumers are storage life of any
unused portion, the ability to recognize the contents by looking at
the package and its graphics, resealability and ease of storage.
Research indicates that with verbal stimuli, people focus on
common features among options but with pictorial stimuli, they
focus on distinctive features of options (Dabholker, 1994). Thus,
greater differences between options may be perceived with pictorial than verbal stimuli, which make the alternatives less comparable. The package is a good medium to carry pictorial stimuli to
the point of purchase where it matters most (Dabholker, 1994).
Important labelling and packaging elements in todays marketing are accuracy, brevity, comprehensibility, durability, good
visibility and multilingual content for warning and instructions
for the disposal of containers. These findings fall in line with the
findings of Kundu and Sehrawet (2002) in which it was observed
that the label and the seal are important from marketing point of
view. Further, approximately 70% of the respondents in another
study (Rimal, 2005) reported that labels helped in the purchases;
the packaging feature that influenced most of the respondents
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd
631
Impact of packaging
which 68% are in rural areas (Banerjee and Banerjee, 2000). The
challenge lies in identifying the key drivers that steer the Indian
consumers perception and behaviour when it comes to their shopping needs (Banerjee and Banerjee, 2000). About a half of Indias
rural population do not have access to good roads and infrastructure. They are relatively poor and so, have limited spending power
(Mahalingam, 2007).
Easy finance associated with rising income has caused a major
boom in the discretionary income of the middle class. This has led
to heightened consumer expectations (Tribune News Service,
2000). Changing life styles of the Indian population are likely to
boost the sales of packaged products. It is estimated that the Indian
food industry would grow to $140bn in the next 10 years creating
wealth from what is waste today (Lakshminarayan, 2001).
Realizing the potential of the rural market, HLL launched
project Shakti 3 years ago, to target villages having a population of
less than 2000, by appointing rural women as retailers of their
products. Today such 13 000 retailers are operating in 12 states
of India and contributing 15% of the companys rural sales
(Srinivasan, 2005a,b,c). The HLL will cover half a million villages
in 2010 (Mahalingam, 2007).
In 19931994, 50.1% households had an income of more than
40 000 rupees per annum (Chaturvedi, 1998). By 20062007 the
majority of rural households (68.1 million households or around
400 million consumers out of total 700 million rural people) will
earn 22 00045 000 rupees ($4891000) a year (Pandey, 2005).
The number of people living below the poverty line is declining
rapidly and faster in rural than in urban areas. The number of poor
in rural areas declined from 37% to 27% (10% decline) whereas
in urban areas it declined from 33% to 24% (9% decline), over
6 years from 19931994 to 19992000 (Gupta, 2005). The prosperity of rural households is growing rapidly. The lowest income
class (2500 rupees and below) is estimated to have shrunk from
60% in 19941995 to 20% in 20062007 (Pandey, 2005).
Sayulu and Ramana Reddy (1996) suggest that the rural
market offers a very promising future for the marketing of consumer goods. But this rural market has certain characteristics that
hinder marketers from exploiting the opportunities provided by
this huge market. These characteristics are: (a) low literacy; (b)
ignorance of their rights as consumers; (c) low purchasing power;
(d) indifference to quality or standards; and (e) lack of cooperative spirit. Ramana Rao (1997) observes that the marketing
boom in the rural areas is caused by such factors as increased
discretionary income, market surpluses, rural development
schemes, improved infrastructure, increased retailing and retailers, increased awareness, expanding TV Networks, liberalized
government policies for rural development, emphasis on rural
markets by companies, new entrepreneurship, competitive and
creative sales promotion, the packaging revolution and changing
life styles. The new generation in the rural areas considers itself
to be like the urban generation.
Sudhakar (1997) observes that the process of evolution of the
urban markets is being replicated in rural India, both for international brands and home-grown products.
Research objectives
The main objective of this research is to make a comparative study
of buying behaviour of rural and urban consumers with special
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd
Description
V1
V2
V3
V4
V5
V6
V7
V8
V9
V10
V11
V12
V13
V14
V15
Research methods
A comprehensive questionnaire was constructed covering 56 variables related to the package. Besides general information about
the respondents, four major issues related to the package were
addressed in the questionnaire, i.e. the package as a marketing
tool, functions of package, package and environment and other
issues related to the package. As only one section of the all four
sections of the questionnaire was relevant for the study of consumer behaviour with respect to packaging, the other three sections were not considered for this study. Therefore, only the 15
variables relating to this study out of the total 56 variables were
selected and analysed. All the responses on variables related to this
study were obtained on 5-point scale (from point 5 for strongly
agreeing with the statement to point 1 for strongly disagreeing).
These variables may be seen through Table 1.
The data were collected through a schedule. A multistage sampling method was used for the study. The study was conducted
in all four administrative divisions of the north-western State
of Haryana in India. The survey was administered in randomly
selected eight cities/towns and 16 villages spreading in these
administrative divisions. Out of these eight cities/towns, four cities
and four towns were selected randomly and out of the 16 villages,
eight large (more than 5000 residents) and eight small (less than
5000 residents) villages were selected randomly for the purpose of
Impact of packaging
AD1
AD2
AD3
AD4
Total
Rural
Urban
203
181
123
113
101
125
96
148
523
567
Total
384
236
226
244
1090
this study. Due care has been taken in preparing the schedule to
suit to the literary standard of the target population. While conducting the survey, due consideration was given to the respondents
of different walks of life, i.e. different gender, educational
standards, economic backgrounds, residential backgrounds, age
groups, people with different buying roles, etc.
A total of 2000 questionnaires (500 in each administrative division) were circulated among the respondents. Out of these, 1182
respondents returned the questionnaires. Of these collected questionnaires, a total of 1090 questionnaires were considered fit for
analysis and remaining 92 questionnaires were deleted as these
were incomplete for one or more reasons. Of these, 523 were from
rural and 567 were from urban respondents. Further details of the
data are shown in Table 2.
The scale of 15 identified variables was also subjected to reliability test. The results show that Cronbach alpha of the scale was
0.632, which is considered satisfactory.
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd
633
Impact of packaging
Categories
Rural
Urban
Total
Gender
Male
Female
1525
2635
3650
>50
Non-literate
Primary
Matriculate
Graduate
Post-graduate
Professional
Service
Business
Farming
Others
<5 000
5 00110 000
10 00115 000
15 00120 000
>20 000
13
4
5
67
8
Head of the family
Purchaser of most products
Influence in buying decisions
User of most products
250
273
204
217
70
32
20
42
144
205
78
34
197
65
55
206
128
267
75
30
23
55
117
130
149
72
163
143
65
152
523
288
279
187
181
151
48
6
24
113
238
84
102
276
77
6
208
71
280
130
55
31
76
184
165
108
34
180
197
90
100
567
538
552
391
398
221
80
26
66
257
443
162
136
473
142
61
414
199
547
205
85
54
131
301
295
257
106
343
340
155
252
1090
Age (years)
Education
Occupation
Total
(46.5)
(49.5)
(52.2)
(54.5)
(31.5)
(40.0)
(76.9)
(63.6)
(56.0)
(46.3)
(48.1)
(25.0)
(41.6)
(45.8)
(90.2)
(49.9)
(64.3)
(48.8)
(36.6)
(35.3)
(42.6)
(42.0)
(38.9)
(44.1)
(58.0)
(67.9)
(47.5)
(42.1)
(41.9)
(60.3)
(48.0)
(53.5)
(50.5)
(47.8)
(45.5)
(68.3)
(60.0)
(23.1)
(36.4)
(44.0)
(53.7)
(51.9)
(75.0)
(58.4)
(54.2)
(09.8)
(50.1)
(35.7)
(51.2)
(63.4)
(64.7)
(57.4)
(58.0)
(61.1)
(55.9)
(42.0)
(32.1)
(52.5)
(57.9)
(58.1)
(39.7)
(52.0)
(49.4)
(50.6)
(35.9)
(36.5)
(20.3)
(7.3)
(2.4)
(6.1)
(23.6)
(40.5)
(14.9)
(12.5)
(43.4)
(13.0)
(5.6)
(38.0)
(18.3)
(50.1)
(18.8)
(7.8)
(5.0)
(12.0)
(27.6)
(27.1)
(23.6)
(9.7)
(31.5)
(31.2)
(14.5)
(23.1)
(100)
Variables
Administrative division
effect (d.f. = 3)
F-value
Residential background
effect (d.f. = 1)
F-value
Interactive effect
(d.f. = 3)
F-value
4.243
12.808
5.772
1.906
2.701
3.304
2.045
1.557
20.087
3.054
15.710
7.257
1.602
4.455
3.360
1.897
12.639
3.451
0.246
6.867
1.228
5.881
5.312
1.419
0.009
2.781
1.881
5.278
4.450
4.789
7.085
4.064
0.225
4.581
6.042
7.456
7.276
15.570
3.095
2.009
1.713
4.912
4.025
0.829
12.942
(0.005)
(0.000)
(0.001)
(0.127)
(0.044)
(0.020)
(0.106)
(0.198)
(0.000)
(0.028)
(0.000)
(0.000)
(0.187)
(0.004)
(0.018)
(0.169)
(0.000)
(0.063)
(0.620)
(0.009)
(0.268)
(0.015)
(0.021)
(0.234)
(0.924)
(0.096)
(0.170)
(0.022)
(0.035)
(0.029)
(0.000)
(0.007)
(0.879)
(0.003)
(0.000)
(0.000)
(0.000)
(0.000)
(0.026)
(0.111)
(0.162)
(0.002)
(0.007)
(0.478)
(0.000)
634
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd
Impact of packaging
Variables
V1 Package adds value
Residential
background
AD1 (M)
AD2 (M)
AD3 (M)
AD4 (M)
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
Rural
Urban
GM
4.38
4.08
4.24
3.83
3.27
3.57
3.62
3.54
3.58
3.89
3.73
3.82
3.95
3.93
3.94
3.63
3.51
3.57
3.68
3.71
3.69
3.60
3.34
3.48
3.91
3.83
3.88
3.98
3.81
3.90
4.28
4.24
4.27
4.21
3.99
4.10
4.38
4.32
4.35
3.75
3.58
3.67
4.11
3.73
3.93
4.21
4.39
4.30
3.82
3.88
3.85
3.48
3.37
3.42
3.46
3.88
3.66
3.51
4.04
3.76
3.31
3.93
3.61
3.13
4.51
3.80
2.92
3.81
3.35
3.25
3.07
3.16
3.95
4.18
4.06
4.34
4.35
4.35
3.82
3.86
3.84
4.00
4.44
4.21
3.79
3.40
3.79
3.70
4.02
3.86
3.82
4.24
4.05
3.38
3.17
3.27
3.32
3.17
3.24
3.70
3.62
3.65
3.82
3.68
3.74
3.42
3.25
3.33
3.48
3.24
3.35
3.44
3.24
3.33
3.28
3.65
3.49
3.78
3.81
3.80
3.72
3.98
3.87
3.60
3.95
3.80
4.34
4.43
4.39
3.50
3.40
3.44
3.62
3.76
3.70
4.04
4.09
4.07
3.47
3.20
3.30
3.34
3.11
3.20
3.83
3.77
3.80
3.77
4.01
3.92
3.51
3.47
3.48
3.62
3.71
3.67
3.43
3.61
3.54
3.51
3.73
3.65
4.04
3.93
3.98
4.11
4.23
4.18
3.91
4.05
4.00
4.32
4.36
4.34
3.68
3.37
3.49
4.21
3.63
3.85
4.17
4.18
4.18
3.68
3.35
3.51
3.48
3.31
3.39
3.74
3.75
3.74
3.79
3.92
3.86
3.49
3.53
3.51
3.50
3.76
3.64
3.38
3.48
3.43
3.56
3.61
3.59
3.95
3.92
3.93
4.16
4.20
4.18
3.95
3.97
3.96
4.27
4.38
4.33
3.70
3.53
3.61
3.94
3.77
3.85
AD1, Hisar administrative division; AD2, Rohtak administrative division; AD3, Ambala administrative division; AD4, Gurgaon administrative division;
M, mean; GM, grand mean.
of packaging. AD1 (x = 4.24) and AD2 (x = 4.30) have a comparatively stronger feeling of value addition than AD3 and AD4.
The residential background of people has an influence on
respondents in considering packaging as helpful in buying
(P 0.000). Rural residents (x = 3.68) consider the package more
helpful in buying goods than their urban counterparts (x = 3.35).
However, from this analysis it can be concluded that the buyers
find packaging helpful in buying (x = 3.51). People in different
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd
635
Impact of packaging
MD (1,2)
MD (1,3)
MD (1,4)
MD (2,3)
MD (2,4)
MD (3,4)
0.028
0.280*
0.160
0.157
0.180
0.037
0.218
0.132
0.186
0.302*
0.344*
0.163
0.199
0.245
0.322*
0.152
0.174
0.264*
0.387*
0.023
0.025
0.089
0.005
0.062
0.159
0.582*
0.185
0.006
0.019
0.283*
0.104
0.020
0.146
0.544*
0.227
0.134
0.155
0.127
0.223
0.194
0.012
0.038
0.042
0.140
0.175
0.156
0.327*
0.214
0.714*
0.158
0.039
0.265*
0.142
0.121
0.076
0.388*
0.105
0.398*
0.352*
0.035
0.224
0.233*
0.227
0.074
0.085
0.104
0.010
0.175
0.080
0.326*
0.263
0.438*
0.087
0.178
0.346*
0.157
0.487*
0.084
0.125
0.161
0.132
0.296*
0.003
0.160
0.179
0.313*
0.248*
0.045
0.049
0.153
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd
Impact of packaging
Policy implications
A significant feature of the Indian rural middle class is its rapid
growth in terms of volume and value. This provides a potentially
huge untapped market. Today, rural consumers are less passive than they were in the past and are more like their urban
counterparts.
So, the package manufacturers and marketers will perceive
opportunities to target rural consumers. To be successful in this
market, they will have to develop their product, modify their
pricing strategies, adjust their distribution programmes and redesign their promotion to suit rural residents. So far as packaging is
concerned, rural customers are graduating from loose to packaged
products as they recognize that it helps them in identifying, buying
and using quality products. They need strong packages, as
handling usually happens to be multi-handed and rough. It should
provide them with convenient storage and it has to address the
issue of environment. The label should be modified to suit their
preferences. The package manufacturers also have to modify their
strategies to suit their new consumers. In future, the prospects of
companies will depend upon how quickly and effectively they
incorporate these dimensions in their marketing philosophy and
how accurately they understand rural consumers preferences.
Conclusion
This study sought to make a comparison of the reactions of rural
and urban markets on packaging in Haryana, India. It shows that
rural and urban consumers vary significantly on various aspects of
packaging. Rural people feel that packaging is more helpful in
buying than their urban counterparts, and they have stronger opinions that better packages usually contain better products. The ease
of carriage, lightness of weight, simplicity, transparency and
consistency of a package have relatively less influence on buying
decisions of rural consumers than urban consumers. Although
labelling is strongly considered to be an important part of a
package, rural respondents give less importance to this aspect of
packaging than urban ones. Rural residents are more environmentally conscious than their urban counterparts as they have a stronger belief that packaging is an environmental hazard. They also are
more likely to believe that packaging contributes to misleading
buyers.
References
Ajarekar, P. (1997) Packaging design. Packaging India, October
November, 9.
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd
637
Impact of packaging
638
International Journal of Consumer Studies 31 (2007) 630638 The Authors. Journal compilation 2007 Blackwell Publishing Ltd