CONSUMER PREFERENCES TOWARDS HYPERMAKETS

IS THERE SCOPE FOR BIG BAZAAR IN TRICHY ?

Section – A, Group-1

Abirbhav Mukherjee [1601001]

Bala Koteshwar K [1601013]
Durlabh Raghuwanshi [1601016]
Kumaresan S [1601024]
Samuel Khongsai [1601042]
Yamini Thombre [1601055]
Introduction
Retail Industry in India:
• Classified as organized(8%) or unorganized(92%).
• Estimated at about US $600 billion.
• One of the fastest growing market expected to grow
by 3 times in next 5 years.
Big Bazaar

• One of the largest organized retail hypermarket

chains in India.
• Currently operates around 200 stores.
• Announced plan of adding about 18 million square
feet of retail stores in the next one year, which is
equivalent to 35-40 new stores.
• Commands 8% of the total retail market share in
India.
Descriptive Analysis
AGE

GENDER
Descriptive Analysis (Contd)
Cluster Analysis:

 Helps identify relatively homogenous clusters

into which the customers can be classified.
 We have tried to

 Identify the number of clusters that can

be formed based on the respondent pool
 Identify the number of respondents who
fall into these clusters
 Identify the basis on which the
respondents are classified under the
respective cluster

 163 respondents could be classified into 3

clusters upon analysing the dendrogram.
Cluster Analysis (Contd.)

 K-means clustering
 To identify the positions of the clusters that minimize the distance
from the data points to the cluster.
 The entire 163 respondents were divided into 3 clusters as shown
below.
Cluster Analysis (Contd.)

 The F test value and the mean squares from ANOVA show the
following results:
o “Income” (F-test value of 212.475) is the most important attribute
upon which the clustering was done.
o Other important classification bases are “Profession”, “Marital
Status” and “Age”.
o The p-value for Gender (0.143) and City (0.12) are greater than
0.05 showing that these attributes are not significant for clustering.
 Factor Analysis:
 Carried out to identify the factors of similar set of questions or variables
which can be clubbed together to convey the same information as a
group of questions.

 We can express the factors as:

Fi = W1X1 + W2X2 + W3X3 + . . . + WkXk

 Factor Analysis (CONTD.):
• The total of the component exceeding 1.0 are taken as valid factors.
• The number of factors obtained are 2.
 Factor Analysis (CONTD.):
• FACTOR 1: R_Availability, R_Experience, R_Relationship, R_Price

F1 = 0.257  R_Price + 0.319  R_Relationship + 0.421R_Availability + 0.393 

R_Experience

• FACTOR 2: R_HomeDelivery, R_Parking, R_Proximity

F2 = -0.264  R_Proximity + 0.486  R_HomeDelivery + 0.471R_Parking

Discriminant Analysis:

 The discriminant analysis model involves linear

combinations of the following form:
D = b0 +b1 X1+ b2X2 + b3X3 + …. + bkXk
Where
D = discriminant score
b’s = discriminant coefficient or weight
X’s = predictor or independent variable
Discriminant Analysis:
• We have developed a Discriminant Analysis Model based on the
below seven factors.
 Proximity from home (X1)
 Prices, Discounts and Offers offered (X2)
 Relationship / Loyalty (X3)
 Desired Brand / Product availability (X4)
 Shopping Experience (X5)
 Home Delivery option (X6)
 Parking space availability (X7)
 Discriminant Analysis:

• Results :
• A significance of 0.037 (i.e. p-value < 0.05) illustrates that the model
suggests significant discrimination between the categories of the
dependent variables.
• A Wilks’ Lambda of 0.905 shows that the model designed though
significant is not powerful and can be improved upon.
 Discriminant Analysis:
• Results :
• The standardized canonical discriminant function coefficients show
that “Prices, Discounts and Offers offered” is the best predictor
followed by “Shopping Experience”.

• The discriminant analysis model is obtained as shown below.

 Y = 0.746 X1+ 0.978X2 + 0.690X3 +0.590X4 + 0.671X5 + 0.881X6 +
1.085X7 – 12.465
INFERENCES :
 Hypermarkets are preferred by about 47.9% of the respondents,
the highest among the retail stores. This indicates a good
potential for hypermarkets to expand.
 About 64.5% of the respondents are aware of Big Bazaar as a
retail store, which is a very high number. Again, this indicates that
promotional activities need not be emphasized much to create
awareness.
INFERENCES (CONTD.):
 67.4% of the people would like to recommend Big Bazaar to their
peers for shopping.

 Through discriminant analysis, we find that customers mainly like

Big Bazaar for:
• Price / Discounts / Offers
• Shopping Experience
 Customers dislike the following attributes of Big Bazaar and hence
attention is required to improve the following parameters:
• Relationship and Customer Engagement
• Proximity
• Product / Brand Availability
INFERENCES (CONTD.):

 Big Bazaar may improve the aforesaid hygiene parameters

through:
• Encouraging Loyalty schemes, cashback or other promotions
• Setting up new stores, wherever feasible, to improve upon
the Proximity factor from people’s houses
• Have more varieties of brands and products for sale in their
shelves
THANK YOU