Global automobile industry is growing with a very fast pace. Technological advancements are very common in this industry, as the disruptive rate has increased. An advancement will be implemented in such a way that it could lead to sustainable competitive advantage. Hybrid cars are one of the most significant technological advancement in the automobile sector. However, people still prefer fuelled cars for personal use due to many underlying reasons. Despite the many benefits attached to hybrid cars such as environmental friendliness, status symbol and fuel efficiency, people living in Indian geographical boundaries are less adaptable to it. This research makes an attempt to identify the consumer perception and buying behavior towards hybrid cars in India. The buying behavior will help to identify the current market and the future market of hybrid cars in India.
The data collection sources used in this study is primary and secondary sources. The number of respondents for this research is 150. The data was collected through research questionnaire, which consists of close-ended questions. The analysis of consumer behavior towards hybrid cars in India pointed towards many significant areas. The consumers in India are not aware of the hybrid technology in cars. Moreover, the market is quite priced sensitive so that they are not interested in buying an expensive car for their personal use. The Indian consumers will wait till the demand of hybrid cars will increase and will be accepted by a huge mass of the population. Thus, the awareness factor should be a prominent signal for the automobile manufacturers. They should start making awareness about the technology with lowering some cost. In addition, the government is taking initiatives to ensure the use of hybrid technology but now the need is of immediate approaches.
Evolution of the car industry has been evolving from the time first car was developed. Evolution of cars has encouraged consumer choices among different options of cars that are available in the market. Electric cars have been in the market since long, but it failed to be called as a disruptive technology (EY). They are also called as a green vehicle or environmental friendly vehicles, which is a road map vehicle that produces less harmful effects on the environment as compared to the engine vehicles that run on gasoline, diesel or any other alternative fuels (Nair, 2010). Moreover, the market is a very important platform to study the behavior of consumers buying intentions. The organization can monitor information relating to customer’s behavior and perception towards a product as to determine whether the product has reached customer’s expectations or not (Monga, Chaudhary, & Tripathi, 2012).
The electric cars are still not yet successful in making the previous ones obsolete. According to a survey, customers have an acute optimism that the electric cars will take 10-20 years in becoming successful over fueled cars (EY). However, there is a potential growth demand in demand of electric hybrid cars (IEA, 2013). The sales of cars have increased at the rate of 38% per annum, and one of the reasons is the increase in disposable income in rural and urban areas. The buying behavior is one of the prominent subjects of the study, therefore considering the factors the research is aimed at finding consumer behavior towards electric cars in India.
Consumer takes numerous decisions in their daily life. These decisions involve different behavior and attitudes based on preferences and judgments. The choice making behavior indicates that there are a number of factors that influence an individual and have many alternatives from which an individual chooses. Thus, the study is aimed to focus on the perception and behavior towards purchasing hybrid cars in India.
1.1. Problem Background
Globally the demand of electric cars is limited to certain countries especially the developed ones. The image below illustrates that few countries have exposures to this innovation while, many geographic regions are still left with this innovation.
The growth of electric cars is also evident by the picture presented below:
(Hurst, and Gartner, 2013)
The picture reveals the growth pattern of electric cars in upcoming eight years. The pattern suggests that growth pattern will increase by 18% between periods of 2012-2018. The growth is based on the assumption that market prices of gasoline will increase by 7.2-8.3% annually (CAGR). Hybrid cars are significantly more efficient in terms of fuel saving in India and China. The reason is heavy traffic and driving condition in these countries. According to the official fuel test conducted in India electric cars provide about 29% of the fuel savings over conventional vehicles. On the other hand, driving a hybrid car would easily achieve fuel savings up to 47-48% over conventional fuel car in India. Currently, hybrid cars in India have a very minute share as compared to the fueled vehicles. Still there is a high potential of hybrid cars in India in the upcoming years (Indian Express, 2014). Therefore, the government of India is taking initiative to encourage fuel efficiency through hybrid cars. India’s government launched a national plan with the aim of getting 6-7 million-hybrid vehicles on the road by 2020 (Chao, 2014).
Hybrid cars have recently been introduced in India; therefore it is in infancy stage in the country. According to IEA (2013), in the year 2012 India accounted only 0.8% of the total electric vehicles stock of the world. This is considerably a small percentage in comparison to the developed countries of the world. As it is a new product in India therefore expansion of such innovative vehicle requires developing consumers’ readiness for buying such cars. Hence for expansion of this new market for hybrid cars in India, it is important to explore market potential. Moreover, it is important to understand the perception of the consumers so that companies can focus on such aspects for expanding in Indian markets. As mentioned earlier, government is taking measures for the growth of hybrid cars market. Howeveraccording to the behavior of the Indian consumers towards these innovative cars, understanding theconsumers are critical in customizing the factors of hybrid car, which in turn will contribute to the development of the market.
In India, electric cars are primarily targeted to the upper-class segment and are expected to do so because of the features hybrid cars are providing. Moreover, the price and positioning of the hybrid cars reflect premium position in India. The Indian electric vehicle markets are facing challenges like pricing, consumer perceptions, continuous improvement, awareness and competition with alternatives. Thus, all these factors have made the competition more aggressive.
Traditionally, cars were considered as a “luxury” but now it has become a necessity for almost all class of people. However, selection of a car that suits an individual’s needs has become very critical and challenging work for an individual because car-making companies are continuously developing new and improved model to provide a high level of satisfaction. Innovation thus, in some past years has led the introduction of hybrid cars. The hybrid cars are delivering superior value in terms of fuel efficiency and environmental friendliness.
With this backdrop at work the study will serve two purposes. First the study will identify the factors that play an effective role in the decision making process of the Indian consumers in buying hybrid cars. As identification of factors is an important part of the research study, therefore the researcher has conducted secondary research for this purpose. The researcher has reviewed different literature including journal articles, online articles, books, published reports, newspapers and other secondary sources to gather information regarding the consumer behavior and hybrid cars. Therefore, reviewing different literature has been highly helpful for the researcher in identifying important factors.
At the time of reviewing literature, the researcher was aware that identifying factors that are preferred by the Indian consumers in making a purchase decision for the hybrid cars will play an effective role in developing the sector in India. The consumers in India are given options to speak their views and concerns about accepting such innovative cars. The automobile manufacturers as well as the distributors will develop information about aspects that will accelerate the purchase trend for hybrid cars in India.
Once the researcher was able to identify important factors, then a questionnaire was prepared. This questionnaire was designed in a way that the respondents were able to answer basic questions in the initial questions of the questionnaire and then more complex questions were asked from the respondents. Therefore, in order to achieve the purpose of the research study, the researcher has identified important factors and then included these factors in the questionnaire.
The other important purpose this study will serve is for the environment as well as the organizations that are making efforts for the betterment of the environment. Identification of the aspects that consumers of India prefer in making purchase decision for cars will enable companies to devise strategies accordingly. Consequently, the market for the hybrid cars will increase resulting from the decrease in the reduction of the demand for gasoline and other fuel cars. Collectively this will save the environment from being affected by the pollution. Organizations such as United States Environmental Protection Agency are working for the reduction of the pollution in India (EPA Collaboration with India, 2014). Similarly, the Environmental Law Institute (ELI) in collaboration with National Law School of India University (NLSIU) has recently published a handbook for the reduction of the population in India entitled “Enforcing Hazardous Wastes Rules in India; Strategies and Techniques for Achieving Increased Compliance” (EPA Collaboration with India, 2014). The expansion of the hybrid cars in India will also serve the purpose being worked on such organizations in the overall interest and benefit of the environment.
This research study will also be helpful for future researchers as the research study will identify important characteristics and factors that influence the consumer behavior. This research study will also be helpful for marketers and business managers as it will analyze and study the behaviors of the consumers in detail. Thus, important factors will be revealed in this research study. Moreover, this study will be adding value about the critical factors that play an effective role in expanding hybrid cars in the Indian market at the time when the industry was in infancy stage.
1.3. Research Question
Considering the topic of the research study, the researcher has identified important factors that influence the consumer behavior in purchasing hybrid cars in India. Therefore, the researcher has identified several factors using literature review and then come up with a research question that will be answered in this research question. Keeping in view the research objectives mentioned above along with the problem statement and purpose of the study, the following is the research question developed.
What factors influence the customer’s perception and behavior towards purchasing hybrid cars in India?
The researcher will aim to answer this research question in the research study. For this purpose, primary and secondary data are collected and analyzed.
2. Literature Review
2.1. The Marketing Mix
The marketing mix is a set of four variables called product, price, place and promotion which is employed by the organization to provide service to the market (Khalil and Hussain, 2014). These enable a marketer to make the various decisions in order to market their product to the existing and potential customers. These are those tools that are needed to crop up the proper market offering by a marketer. Kotler and Armstrong (2013) defined them as a set of such controllable marketing tools that can be used in different combinations together to generate the intended response from the market.
Taking them one by one, product refers to the product itself i.e. the main or core product that a customer shall use alongwith the varieties, packaging, accessories and the services along the product, both pre and post sale services.
Price refers to the listed price, discounts, credit period, payment terms, etc. Price is a critical factor that affects customer decisions and choices. To influence these decisions different marketers use different pricing methods and strategies. Hinterhuber (2008) outlines value based pricing as the most popular among academics and practitioners.
Place refers to the availability of the product to the customers, the channels, logistics, transporting and management of all these. Many scholars argue that products have to be accordingly placed. Westerbeek and Shilbury (1999) gave the example of marketing sports and argued that in this case, place is the factor to be most focused upon.
Promotion refers to creating the distinctive image of the product i.e. brand and positioning it superior and better than substitute products and rival brands. This includes activities such as advertising, personal selling, public relations, and customer relationship, etc. These communicate both the presence and image of the market that is offering to the customers. Cooper (1979) illustrated the need of strong market orientation for product success. Together the four P’s give marketers a base to make an effective marketing strategy (Goi, 2009). These methods help marketers generate ideas to pull people to their offers.
2.2. Consumer Decision Making Process
Consumers take numerous decisions every day. These decisions involve different behaviors and actions based on judgment, preferences and needs. This choice making process shows that the consumer has alternative options from which he would choose the most appealing one. The consumer is dependent on the evaluation and selection of alternatives. Reynold and Olson (2001) have made a valuable addition and suggested that choice of consumers is mostly dependent on the selection and evaluation of alternatives. This research suggests how different factors on consumer decision making process impact their decisions.
Han, Lerner and Keltner (2007), conducted a study about how emotions impact consumer decision making process in reference to Appraisal Tendency Framework. According to the research, the role of risk and monetary value impact the decision making process. In the same way, study by Yoon, Cole and Lee (2009) mentioned about the fit between the demand of the task, consumer characteristics, and the impact of the contextual environment. Their findings conclude that among these factors consumers are more likely to use their knowledge and experiences in decision making process as compared to the situation. Therefore, simple decision making process of consumer always has an impact from a lot of complex variables.
As stated by McKinsey Quarterly, consumer decision making process has observed a noticeable change over the past couple of years. Decision making process before was more like a channel from which the methodological reduction of alternative finally resulted in the selection of brands as depicted as follows:
Contradicting to this traditional model, McKinsey Quarterly states that the contemporary decision making process is more circular in nature which is presented in more detail in the given below graphical representation:
The diagram above suggests that consumers take up the entire process in the initial phase and once the loyalty is built up, the consumer does not undertake the evaluation of different available options every time there is a need to do so. As an alternative, the consumer now goes straight to his selected brand for which the loyalty is built. This process makes it difficult for other brands to pull the customer towards them since breaking the loop of loyalty becomes more complicated.
2.3. Consumer Purchase Decision for Cars
Most consumers are confused when deciding to buy a car because of the large amount that cannot be spent on a daily basis. Buying a car is a purchase made seriously as a commitment for the years coming in regard to future car payments, taxes that will be levied on, along with operating and maintenance costs. Due to these high economic and social stakes, stress levels will be high as well.
Consumers pay special attention to the information and ratings as perceived risk increases on any purchase. Buying a car is no different from any other purchase, as consumers devote many hours to collect information from as many sources as they can find and considering numerous other variables. Some of the steps considered in buying a car may include:
- Gathering information about characteristics on different cars
- Narrowing down alternatives to a smaller set
- Test-driving these alternatives to get a better performance view
- Getting information on prices and comparing them with the car features
- Determining the potential value of trade in (if any)
- Comparing their financing alternatives such as loans
- Closing the deal
In a 2000 CR survey, consumers ranked the following factors as most important in their decision when they are purchasing a car.
- Reliability of car
- Reputation of the model
- Car driving performance
- Pricing information
- Ratings of safety
For some consumers, their selected car is also a symbol of social status. Some factors that influence decision making include the use of car, household size, etc. Consumers today are more concerned about fuel efficiency. This trend can be determined by 30% decrease in SUV sales at 2008 and record petrol prices (Barris, 2008).
Surveys have found that car shoppers adopt their perspectives by the number of sources and amount of time spent with each source. Consumers always look for sources that have the most useful data according to their preferences. Attributes of these preferences vary widely. Individual character influences decision making along with significant weight age of finances. Higher educational level consumers especially those with more car buying experiences are more expected to browse through information before buying cars than others. Surveys during the early 2000 suggest more new car buyers in Buffalo New York found consumers with high educational background and earnings were prone to use Internet as their main source for information. These mostly include younger car-buyers than older ones. Behaviors of first-time car buyers act differently as compared to people with prior car buying experiences.
2.4. Impact of Evolving Different Types of Cars
Car Industry today is not the same as the first car ever invented, it is now far improved and much more efficient. A lot of different categories have been developed and are under constant innovation and changes towards making it even better. Since the current era is based on newer technology, cars are also being modified with the advancement in technological development.
Considering the case of Odekerken-Schröder, Hennig-Thurau, & Knaevelsrud, (2010) and Rosengarten and Stürmer, (2005); both the manufacturers provided different meaning for premium and luxury cars.
Odekerken-Schröder, Hennig-Thurau, & Knaevelsrud, (2010) described premium cars as improved form of a standard car with improving quality and giving special considerations to functional attributes. This improvement is mainly because premium cars have greater and much better focus on the functional characteristics and secondary consideration toward the artistic attributes.
Rosengarten and Stürmer (2005) on the other hand have described the luxury cars as those models which have a strong emphasis on the features that add value to the complexity of cars. Primary emphasis of the luxury cars remain on improving artistic characteristics while the functionality is given a secondary consideration.
With reference to the above definition of premium cars, most of the cars today and in the time before can be considered as premium cars. This definition can further be explained as gasoline cars have been improving to reduce the impact on the environment by decreasing the carbon emission. Because of this, governments have been offering tax incentives to cars that use Ethanol, natural gas, biodiesel, etc. These function characteristics of cars bringcustomer a combination of economic and functional benefit.
Further based on these features another category that is gaining popularity is now hybrid car that runs on petrol, as well as a battery. Although hybrid cars mainly was based on the purpose of being environmental friendly, as stated by Griskevicius, Tybur & Van den Bergh (2010), customers of such cars are more driven by the social status and professions. This conclusion is derived from the study of Noblet, Teisl and Rubin (2006) in reference to purchase decision of the cars that are labeled as eco-friendly. It also avowed that although consumers do give much attention to the environmental friendliness of the car, still the type and reaction level vary from customer to customer.
2.5. Role of Factors Affecting Consumer Buying Behavior for Hybrid Cars
Consumers are now buying more environment friendly cars. Out of these, mostly are into petrol-electric hybrid as they are the better performers. One of the most popular green cars is Toyota Prius which is also being called as the market leader. During 2009 and 2010, Prius was labeled as the top selling car in Japan (Mick, 2010). Sales have continued to increase regardless of well exposed safety and quality issues (Mitchell & Linebaugh, 2010). Other manufacturers have started coming up with their own hybrid models signifying the demand for hybrid cars. Toyota promotes the Prius as environmental friendly alternative to conventional cars of the same category since it consumes less petrol and produces lesser carbon emissions. This marketing position seems to be most important for consumers who wish to contribute towards the safety of the environment through less polluting car (Griskevicius, Tybur & Van den Bergh, 2010; Bamberg, 2003). This trend suggests a strong consumer response towards petrol-hybrid cars, proving that consumers are more motivated by intrinsic reasons for taking up these types of cars.
2.5.1. Intrinsic Reasons for Opting to Hybrid Electric Cars
Conservation and environmental friendly consumers are motivated by intrinsic values for choosing eco-friendly goods (Chan, 1996; Bamberg, 2003). Intrinsically persuaded consumers purchase hybrid cars as they want to minimize the effect of driving towards environment. Since these consumers have control over their purchase decisions, they consider the fact that use of an eco-friendly vehicle will assist them to achieve their goal of making environment better. Identifying an intrinsically motivated consumer was used in self-attribution theory (Heider,1958) and self-efficacy theory. Survey research has time and again reported people who are more ecologically sensitive have a higher tendency to adopt eco-friendlier products (Bamberg, 2003; Hansla et al. 2008; Gatersleben, Steg & Vlek, 2002; Stisser 1994; Anable 2005; Maloney& Ward 1973; Minton & Rose 1997). People having intrinsic reasons for choosing a more eco-friendly vehicle worry more about how their car affects the environment (Follows & Jobber, 2000).
2.5.2. Extrinsic Reasons for Opting to Hybrid Electric Cars
Different method studies found that being eco-sensitive does not mean the consumer will buy environmental friendly good (Mainieri et. al. 1997; Barr 2004; Diekmann & Preisendörfer 1998). Studies relating to this only show a moderate association between the adopting of environmental friendly products and constructs of environmentalism (Bamberg 2003). As per the outcome of these different method studies, extrinsic rewards such as status, image and popularity can be stated as strong drivers for some consumers to choose environmental friendly goods (Clark, Kotchen & Moore 2003; Stern 2000; Jansson, Marrell & Nordlund 2009). Consumers were more probable to select an eco-friendly car when the result of the buying decision was publicly prominent compared to when buying privately, Griskevicius, Tybur and Van den Bergh (2010). Consumers were more interested to buy ecofriendly car if its conspicuous use would portray them as pro-social and unselfish. This would let them have a desirable ‘status’ in their social group.
2.5.3. Social Influence
An individual’s choice can be affected by social influence (Ajzen and Driver, 1991). Consumers buy specific products so as to achieve recognition, fit in with, to gain social standing in reference groups (Griskevicius, Tybur & Van den Bergh, 2010; Steg 2005; Pelletier et al. 1998; Heffner, Kurani & Turrentine 2007). This reason is significantly more appealing for some consumer groups (Steg, 2005). These consumers are sheep who will go in the direction of their preferred groups. One example of this can be that individuals likely to social influence will buy a hybrid car because others in the group own hybrid cars as well. Within a professional situation, social influence may trigger the use of a hybrid car due to the feeling that it is necessary to obtain the “correct” car since it is expected of them in their social circle. In such a scenario, consumers find it necessary to drive a hybrid car. Following their social group, the consumers feel they will witness a good image or rapport in front of their group (Kahle, 1995). Since social influence is anticipated to be in both, hybrid and conventional cars, it is expected to emphasize a more significant effect in the evaluation process for hybrid consumers. This influence is because of the image effects related with buying petrol-electric hybrid vehicles.
2.5.4. Consumption and Environmental Sensitivity
The current popularity for environmental friendliness began after 1970, following the idea of global warming and finite oil reserves (Minton & Rose, 1997; Pelletier et al., 1998). This belief has influenced the way people live and hence persuading millions of people to reduce the overall consumption of the energy along with the quantity of by-products that are the outcome of their consumption activities. This belief is also one of the main reasons to why consumers choose cars like the Prius (Jansson, Marrell & Nordlund 2009). Consumers that are set out towards this sort of consumption have been defined as conscious towards environmental sensitive, or in other words, environmentalists. These people are more positively oriented towards protection of the environment than others (Casey & Scott 2006; Minton & Rose 1997; Stern et al. 1995). So when a consumer buys a petrol-electric hybrid car such as Toyota Prius, they are selecting an alternative-fuelled vehicle. Although the rate of choosing environmental friendly product has been slow (Kaplan 2000), high rate of hybrid electric car has seen a rise, but not of the other cars. This popularity is because of the effect of “going green to be seen," as stated by Griskevicius et al. 2010 that the need to acquire of a hybrid automobile is derived by social pressure and popularity.
Image of an individual is perceived closely towards the quality of the car which can include factors such as high tech or more towards the comfort and simplicity. Hybrid cars including Toyota’s Prius and Camry are seen as luxury vehicles along with being eco-friendly. Consumer behavior has a significant history between use of products and self-image (Dolich, 1969). These cars are used noticeably by some significant people such as politicians or actors so as to portray their environmental contributions. This trend is also similar to some firms with “green” image (Rennings, 2000); these public figures then become role models for being eco-sensitive and hence encourage others to adopt their ways. This way acceptance of the hybrid cars is thought to be means to socially desirable and politically correct adaptation (Kahle, 1995). The Prius is one of the most well-known and also the most selling hybrid models. One particular reason for this is that it is used by many Hollywood actors as well as politicians throughout the US and, therefore, encouraging for others to think about at the time of buying their next car. Other Honda hybrid models look exactly like a Civic but are virtually unknown to consumers due to not being popular.
2.6. Consumer Buying Behavior towards Hybrid Cars in India
According to the research conducted by U.S. Department of Energy, the findings included hybrid cars were more fuel efficient in China and India than in the U.S. This has encouraged the Indian Government to look closely towards this study as sales of personal vehicles is exceeding day by day. Due to the heavy traffic on roads and aggressive style driving and, above all, the lesser number of highways, hybrid cars are ideal for fuel savings.
Indian government in 2013 started a national plan for getting 6 to 7 million hybrid and electric cars on the road by the year 2020. It has already begun the execution with Berkeley Lab to analyze and monitor the progress of this plan (Chadha, 2014). Government is also likely to offer a subsidy on hybrid cars to encourage more and more people towards cost saving and lower the burden of importing oil products on the current account to further turn this plan into a success.
The most problematic view is the cost as according to NavinMunjal the high-purchase price is because of the expensive batteries and motors used. Hybrid vehicles use lead asset batteries, which are at least one-third of the cost of the vehicle, are being imported from China.
Indian consumers still are not fully convinced on the hybrid option. Even though knowing that hybrid cars help keep the environment clean and are also cost effective in the long term, still people are confused regarding the selection of the hybrid cars. Indian consumers would only be ready to pay additional money if they see that the demand is rising, and hybrid cars are becoming common. In other words, government needs to persuade them more.
The research methodology chapter provides deep insight roadmap of conducting research in a systematic manner (Stewart, 1993). A Well-structured methodology is an activity, which is scientifically design in order to perform a study. A clearly stated research methodology provides comprehensive attention and address to the areas of research within specified scope and limited resources (Sekaran, 2006). In order to understand the area of the study, one has to be familiar with the design methods and approaches used. The steps to be followed will provide insight about the steps used in conducting research entitled as “Consumer’sperception and behavior towards purchasing hybrid cars in Indian market." This chapter also provides the information relating to the limitations attached to research.
This chapter is important for the research study as it defines and explains how the research is being conducted. This chapter will define the data collection methods used by the researcher. Moreover, the research strategy implemented by the researcher has also been explained.
3.1. Research Overview
Strategy is defined as a plan or a set of actions that are devised to achieve a specific objective. Similarly, the research strategy is a plan, or course of action decided to reach research objectives. In order to achieve the desired result in systematically designed way, the underlying research plan is used to determine the scientific research strategy (Jankowicz, 2005). According to the methodology-based-literature, strategy used for research can be of two formats; inductive or deductive format (Crabtree, 1992). The deductive approach or plan to research is supported by already developed theoretical framework and research constructs. On the contrary, the inductive approach is one in which various relationships are tested and then theoretical model are built (Jankowicz, 2005). The research approach adopted for underlying study has adopted deductive strategy. As a matter of fact, that there are certain factors which affected investment in any area. The study aims to explore the factors that affect perception and behavior of the consumers towards purchasing hybrid cars in Indian market.
The case here is to identify the consumer perception towards buying a hybrid car in Indian market and the factors that influence the purchase behavior. Considering that there are numerous challenges attached to the company in finding behavior patterns, the research has set the objective to find the post purchase behavior and the factors that influence an individual’s decision for buying a hybrid car. As defined in objective, the research approaches are defined as exploratory and descriptive. The descriptive research is defined as an approach to identifying facts and details as they exist. On the other hand, exploratory research is defined as to explore things; if any relationship between certain variables exists (Maylor & Blackman, 2005; Patton, 2002). Hence the underlying research is to explore the purchasing behavior of the consumer in the context of the Indian market and descriptive in nature because descriptive analysis and data will be gathered.
Once a structured set of actions has been developed, next is to make a decision related to successful implementation of research strategy. It is important to state the various research methods, which will help in achieving the research objectives. Broadly categorized there are only two categories within which there are many sub-categories i.e. observation, interview, questionnaire. The research is planned to be a combination of both qualitative and quantitative approach.
In this study context, the sample includes all private consumers who have their own cars. However due to certain time and cost constraints, the total set of population as sample cannot be taken into account for study purpose. Therefore, a sample of 150 respondents between the age group of 18-60 will represent the total population. The sampling strategy used in this research study is to gather the right samples or people from the whole population. For this reason, nonprobability sampling strategy has been used. The sampling strategy has allowed the researcher to identify some important respondents and then analyze the views and their concerns. The sampling strategy has been helpful in completing the research study in a short time and cost.
The sample is referring as a subset of the entire population that serves as a representative of the total population. Sampling is conducted because it is impossible to test each in the population. It saves time, effort and money, while conducting research. It must be kept in mind that the sample must be sufficient to warrant statistical analysis and in order to justify the study. The total number of respondents was 150 of the Indian market to extract rich data and findings. The respondentswere contacted through emails in order to fill in the questionnaire. These email addresses were gatheredfrom car company database in India.
3.3. Methods of Data Collection (Primary and Secondary)
Data collection is one of the important phases of the study. Accurate collection of data will result in an accurate result with a minimum level of error. The data collected for the research will be done through primary & secondary sources. The researcher has used a combination of both primary and secondary data collection method. Therefore, the secondary data collected from literature review is compared with the primary findings. Thus, it has allowed researcher to compare whether the secondary findings are in accordance with the primary findings.
3.3.1. Primary Data Collection
The primary data is firsthand information collected from respondents for the purpose of research (Snieder & Larner, 2009). The questionnaire is used to gather the primary information, which will help in gathering information and interpreting it through various tools. The questionnaire will consist of open-ended questions.
Questionnaire has been used as the main primary data collection method tool. Questionnaire has allowed the researcher to collect information from a number of respondents in quick time. The use of open ended and close ended question has enabled the researcher to identify and understand the responses of the consumers. Questionnaire is an important way of identifying the views of the respondents. Moreover, using questionnaire the researcher has been able to collect important data easily and in quick time. In addition to this, respondents can freely answer and share their responses in questionnaire and this was another important reason why the researcher selected questionnaire as the data collection method.
3.3.2. Secondary Sources
The secondary data sources are the sources that are already collected by someone else in the past. Sources of secondary data collection include journals, books, articles, organizational reports or any other information sources (Snieder & Larner, 2009). The secondary data will help to extract the previous studies conducted on consumer behavior. All the information will be in part of the literature review.
Secondary sources have played a critical role in collecting data in this research study. The researcher has collected information from books, journal articles, online sources, published reports, newspapers, and other secondary sources. The researcher started the research with secondary research and reviewed different literature to know about the topic under study. Therefore, secondary sources have been very helpful in identifying factors that influence the consumer behavior in purchasing the hybrid cars in India.
3.4. Questionnaire Design
The questionnaire design was based on the conceptual framework and literature review. The concepts developed through literature review were translated to the questionnaire. All questions in the questionnaire were based on the main variables identified in the literature review i.e. factors affecting the consumer behavior on purchasing hybrid cars in India.
Considering the fact that India is a huge country with a large population (1.2 billion), therefore 150 respondents do not represent the total population of the whole country. But it does give an insight of what can be obtainable regarding hybrid vehicles in the Indian market.
3.4.2. The Purpose of Questionnaire
Primary data is collected using questionnaire. Questionnaire is one of the most used primary data collection methods. Questionnaire allows the researcher to collect information easily and in a hassle free manner. Respondents are able to freely answer the questions without being worried about any conflicts or argument from others. In addition to this, questionnaire gives the flexibility to the researcher to ask different questions from the respondents. Also, questionnaire allows protecting the privacy of the respondents. Moreover, questionnaire can be analyzed scientifically.
3.6. Method of Data Analysis
The importance of data analysis is evident from the fact that systematic data analysis will lead to quality and accurate results on which conclusion will be based upon. Therefore, analysis tools must be used correctly, and reliable tools will be taken into consideration so that the proper result may be achieved. The data analysis tools used is graphical and descriptive analysis. For this research study, the researcher has collected and accumulated all the responses of the respondents. These responses of the respondents have been accumulated and calculated and then Microsoft Excel is used to prepare graphs. Using these tables and graphs, the researcher has analyzed the data collected from questionnaire.
3.7. Ethical Consideration
Ethical consideration is most important factor that should be kept in consideration while conducting research. For primary research, the importance of attention in a meeting is very important as the information provided can have a critical impact on the output. To meet the ethical standard of the participants conducting the entire research, in order to meet the accuracy and reliability standards following are some measures taken by the researcher:
- Research participants were given brief information about the purpose of the study and were required to submit their agreement on the underlying study.
- Moreover, the participants were also given a confirmation that the information will be kept confidentially and cannot be used for any unethical activities.
4. Empirical findings and Data Analysis
This section of the report will provide an insight view on the data analysis part. The data analysis tool used in this research is descriptive and graphical analysis. The research tool used is comprehensive questionnaire consists of nine-closed ended questions. The questionnaires were sent out to 250 email addresses from which the total number of respondents was 150. As far as the response rate is concerned, it was 60%. The respondents are a combination of both the genders with different income group level to develop a comprehensive, rich study. The data analysis part will also consist of factors that influence the purchase decision and consist of the factors that lead to customer’s hesitation while purchasing a hybrid car. These finding will help in developing a comprehensive study on the buying behavior of the customer towards hybrid cars in India. The analysis part will describe briefly about the findings and help to find the research objectives. The following are the data and findings that help in reaching a comprehensive conclusion.
Question 1 (Gender)
The above question is used to analyze the ratio of male and female in total respondents. This question will help in analyzing the gender-concerned information in relation with buying behavior of hybrid cars. The gender information collected from the respondents reveals that males as compared to the female respondents use the new technologies more. About 90% of the respondents were males because of the Indian demographical factors. The women tend to be less aware of the new technology may be because of the male-dominated society. As part of the workforce, males are more employed and are working as compared to females. The males, therefore, are open to new technological and innovation information.
Question 2 (Age Group)