Marketing Strategy of Otobi Furniture Selecting Appropriate

RAB 8 Barisal

Chapter 1

ORIGIN OF THE REPORT

This report is made on “Selecting Appropriate Marketing Strategy for Otobi Furniture”. As an Associate Professor of Project Work Course Dr. Monowar Hossain Mahmood orally authorized me to make this report as a part of Course of Bachelor of Business Administration Program of East West University. It is due on 20th August 2007.

 

Purpose

 

Purpose of this report is to select the appropriate marketing strategy for Otobi Furniture. We know that the competition in the furniture industry is increasing day by day as new firms are coming in the market like Studio 45, legacy. As a result now a day Otobi Furniture is facing a huge competition. For maintaining their previous position in the market, I am preparing this report to select the appropriate marketing strategy for Otobi Furniture.

Scope

 

The Project Work is a comprehensive study of the consumer’s belief about the Otobi Furniture. The report focuses on the Consumer’s belief, perception, lifestyle etc. and the current and appropriate marketing strategy of Otobi Furniture.

 

Limitations

 

To preparing the report I face some problems that effect to make a good report. Such as,

v  I did not get the real annual sales data of Otobi Furniture. It was easy for me to identify their current position if I got that.

v  For most of the corporate information of Otobi Furniture I totally depends on the information that provided by the officials of Otobi Furniture Showrooms.

v  I did not get sufficient time to make a successful report and for this reason I made it as early as possible.

v  I did not get any report prepared in past in our library, so I only depends on instructions given to me.

v  Initially I selected only 70 respondents as sample. Among these 70 questionnaires I found some of them are faulty. As a result these 70 respondents I selected 60 as my report sample.

v  I use both Microsoft Excel and SPSS software to make this analysis. It would be better if I make this whole analysis by SPSS software as SPSS software gives most critical analysis than Microsoft Excel.

 

Historical Background

 

We know that the competition in all kinds of industries is increasing day by day. Furniture industry is not an exception. So all the firms are now facing huge competition as people have so many alternatives now. As a result I am preparing this report to find an appropriate marketing strategy for Otobi Furniture.

Report Preview

I made this report on the topic “Selecting Appropriate Marketing Strategy for Otobi Furniture”. In this report Introduction parts contains Report’s origin, Purpose, Scope, Limitations to prepare this report and Historical background. Study Methodology will come next. In Study Methodology part I show the Study approach, by what style I collected data; which problem I faced with Methodology; how I collect our information. I made the main part of the report in ten parts. The first part contains the company profile, The second part contains the 6 P’s of Otobi Furniture, third part contains the profile of the target market, forth part contains the external factors that influence purchase of Otobi Furniture, fifth part contains procedure of information processing of the consumer, sixth part contains attitude of the consumer towards Otobi, seven part contains how Otobi can change these attitudes, eighth part contains relationship of Otobi with the consumer’s emotion and lifestyle, ninth part contains how can Otobi motivate the customers and the last part contains drawbacks and suggested strategies for Otobi.

I made this report in this way as I want to discuss the purpose, scope and limitation first; then how I collected the data, how I made this analysis, then I discuss about present position of Otobi Furniture, then their target market, then factors that influence the purchasing decisions of Otobi and the people’s attitude towards Otobi, then how can Otobi change these attitudes and at last the drawbacks and promotional strategies for better understanding of our respected readers.

 

Literature Review:

 

Consumer Attitude and the buying decision

An attitude is a learned predisposition to behave in a consistently favorable or unfavorable way with respect to a given object (A product category, a brand, a service, advertising, a web site or a retail establishment). According to the tricomponent attitudes model, attitudes consist of three major components: a cognitive component, an affective component and a conative component. The first component of the tricomponent attitudes model consists of a person’s cognitions, that is, the knowledge and perceptions that are acquired by a combination of direct experience with the attitudes object and related information from various sources.  A consumer’s emotions or feelings about a particular product or brand constitute the affective component of an attitude. Conaton is concerned with the likelihood or tendency that an individual will undertake a specific action or behave in a particular way with regard to the attitudes object. ( Leon G. Schiffman & Leslie Lazar Kanuk )

An attitude is an enduring organization of motivational, emotional, perceptual and cognitive processes with respect to some aspect of our environment. Thus, an attitude is the way one think, fells, and acts toward some aspect of his or her environment. It is useful to consider attitudes as having three components: cognitive (beliefs), affective (feelings) and behavioral (response tendencies). The cognitive component consists of a consumer’s beliefs about an object. For most attitudes objects, people have a number of beliefs. Feelings or emotional reactions to an object represent the affective component of an attitude. The behavioral component of an attitude is one’s tendency to respond in a certain manner toward an object or activity.

Analyses of consumer purchasing decisions are not uncommon (Engel et al. (1968); Howard and Sheth (1969); Nicosia (1966) being among the seminal works in the area), and a body of knowledge has developed, as will be discussed briefly in the following section. The majority of this literature, however, concerns differentiable products, be it brand or store, and therefore may not be directly applicable to a good such as electricity. It is necessary therefore, to understand the inherent difference between utility products and more conventional products, before the existing literature can be applied to this context.
Utilities as products

Consumer goods are normally categorised as being convenience, shopping, speciality or unsought goods. Table I summarises the main characteristics of each of these types. Although utility products cannot easily be fitted into any of these categories, they perhaps most closely fall in the convenience good category. Convenience goods, as the name suggests, are those goods that the consumer needs on a regular basis (obviously with electricity and gas supply this concept is taken to the extreme as supply must be continuous), often have limited differentiation, and where the consumer exhibits little involvement in the decision process.

If we focus upon electricity supply, we can note that, although it shares some of the characteristics of convenience goods, it differs markedly in a number of aspects. First, it is intangible, although it should be noted that its benefits are not (e.g. the light comes on when the switch is flicked). As mentioned earlier, supply is also continuous, whereas staple goods, although purchased frequently, are finite. There are also no true substitutes; gas may be viewed as an alternative source of power for certain appliances (e.g. cooking or heating), but for most modern households there is no alternative source of power available for lighting, and other appliances such as television, hi-fi, etc. Again, although some staple goods may be limited to the extent to which they can be differentiated, there is generally some differentiation possible, and a number of substitute products available (e.g. lamb can be differentiated in terms of fat content, rearing and treatment of livestock, and can be substituted by other meat products). Electricity, however, is truly undifferentiable[2]: consumers require that their electricity supply be continuous, reliable and supplied with sustained frequency and voltage (Steiner, 2000) but, beyond these most basic attributes, there is nothing that electricity providers can do in terms of differentiating their product from competitors.

It can thus be argued that households cannot choose simply not to require an electricity supplier, but instead will be deciding on who that supplier should be. A parallel could be drawn here between retailers of a range of staple goods – although any single good can be substituted, consumers will need to select a retailer from whom they will purchase their group of staples. However, whereas retailers of convenience goods can compete for store patronage along a number of dimensions, such as price, location and product range, arguably the only basis upon which electricity suppliers can compete is price and service.

Having established the distinguishing characteristics of electricity consumption, the buying process is now examined.
The buying decision

There has been substantial research on consumer behaviour, examining the decision process, and influences upon it, in terms of both brand/store attributes and consumer characteristics. Central to these models is the belief that consumers go through a decision process of varying complexity, depending on the nature of the decision they are making, with a number of possible variables which influence this process at a number of stages. It is believed that the buying process begins with need recognition. Having recognised a need, consumers then search for information about retailers/products that might satisfy the need. Having gathered information, consumers will then evaluate the alternatives, and make a purchase decision. Following purchase will be some form of post-purchase feeling/behaviour, when the decision is assessed (Kotler, 1997).

Whether consumers actually do go through each of the stages outlined, and the amount of time spent at any one stage, is likely to vary with the nature of the purchase. Where the purchase is perceived to be of high risk, it is likely that the consumer will spend more time in the information search and evaluation stages. Such buying decisions are termed complex or high involvement decisions (Assael, 1987). For routine or habitual purchases, the decision process will probably be simplistic or low involvement: no formal process of information search or evaluation will be gone through, and consumers will rely on past experience.

As discussed in the previous section, utility products differ from conventional products in a number of ways. In order to understand consumer behaviour for these products, it is therefore appropriate to consider the impact of these attributes on each stage of the buying process. Thus, each stage of the model is considered in turn and, relating to the marketing mix, the implications for consumer behaviour are considered.
Need recognition

Needs may be functional or psychological in nature, and retailers are often trying to satisfy psychological needs as much as functional ones (Babin et al., 1994). In the case of electricity or gas, the need is obviously functional in nature but, whereas with most functional goods there is an obvious stimulus resulting in need recognition (e.g. the refrigerator is empty, the carpet worn, etc.), for electricity or gas it is less so. When you switch on the light, do you give a second thought as to whether electricity is going to flow or, indeed, who provided that electricity? Electricity itself is intangible and, although its effect is transparent, it is taken for granted. Exacerbating this problem is the continuous nature of the product – most goods that consumers buy are finite in duration (again, either in functional or psychological terms) – electricity is provided continuously, with no “practical need” to seek out new suppliers. In fact, the only situation in which consumers arguably actively need to search for an electricity provider, is on moving house.

Given the above discussion, how then can providers stimulate need recognition? In essence the only way in which suppliers can try and alter consumer behaviour is through promotion. However, the effectiveness of promotion may be limited, as the literature suggests that consumers are naturally conservative and therefore tend to display inertia, that is, they are inherently reluctant to change. Sheth and Parvatiyar suggest that marketers will try to “create an environment for increasing consumer inertia by providing conveniences and process simplification to minimise the desire to seek other alternatives” (Sheth and Parvatiyar, 1995, p. 4). The fact that consumers are encouraged to pay through direct debit schemes, so making it more complicated to change supplier, suggests that utility companies are attempting to create an environment to further promote the already inherent inertia in order to maintain customer loyalty. Such practices, along with the continuous nature of electricity supply, suggest that incumbent providers are likely to be at an advantage over newcomers.
Search for information

Once consumers recognize the need for a good or service, they will then undertake an information search. This may be passive (using internal sources such as the consumer’s memory), or active (using external sources, such as advertisements, magazine articles, family/friends). It has been suggested (see Assael (1987) for discussion) that the extent and depth of this search will depend upon the nature of the buying decision. Where the good being bought is a routine product (staple), or of little value/perceived risk, then the buying decision is said to be of low involvement. In such a case there is unlikely to be an extensive information search – indeed, the “information search” may simply consist of the consumer’s memory.

Electricity and gas can be viewed as routine purchases (although as discussed previously they are not discrete transactions in the traditional sense), and as such the information search is likely to be limited. The decision to change suppliers, however, alters the nature of that relationship and requires a more extensive search pattern. Arguably, therefore, and given the complexity of the search, unless consumers have a particularly strong motivation to search for new suppliers, it is unlikely that they will actively search for information, and hence remain loyal to their existing supplier. That is, as long as consumers are relatively satisfied with their existing supplier, and mindful of the perceived complexity of the information search process, they will not seek information on other providers.

Consumers may also remain loyal as a reaction to information overload. Electricity is a mundane, routine purchase, and so consumers may not be prepared to devote time to sort through all the information available to them on electricity providers. As Sheth and Parvatiyar (1995) argue, because consumers have a limit to their ability to process information, they may exhibit satisficing behaviour rather than maximising. In other words, they will only seek further information if they are unsatisfied [3], even if there is a possibility that there may be an alternative that would derive them greater utility.

Given that consumers are unlikely to be willing to search extensively for information, what type of information can electricity companies provide to impact consumer behaviour? As mentioned earlier, electricity or gas is an undifferentiable good, and therefore the prime type of information the consumer is likely to seek will relate to price. Indeed, for most low involvement goods, purchases are frequently made on the basis of price (Assael, 1987). However, offering a lower price may not be sufficient to cause customers to change supplier, as consumers are thought to exhibit threshold responses (see, for example, Malhotra (1983)). Thus, it may be that customers will only change supplier if the price differential reaches a certain level, presumably as small gains in price will not compensate for the inconvenience of having to change supplier.

The issue is complicated further, as consumers are unlikely to know the price their current suppliers charge, or their volume of usage, and so any price message can easily become confusing, and as such probably ignored. Indeed the potential for “confusion marketing” (Cruickshank, 2000) in utility pricing is a real danger to the logical progress of competition. Although consumers are likely to primarily consider price as the key determinant of choice of electricity provider, the service suppliers provide may also come under scrutiny, as may environmental issues, and these may be easier messages to get across to consumers. However, whether these alone will be enough to prompt a change in supplier is questionable.

Evaluation

How consumers evaluate electricity suppliers will depend on the relative importance they place on convenience, price, service, and other factors such as environmental issues. As has been stressed before, there is a high probability that the consumer will prefer the convenience of remaining with their existing supplier, rather than having to go through the inconvenience of changing supplier. Even if electricity suppliers could take on all the tasks associated with changing supplier (e.g. filling in forms, cancelling direct debits, etc.), whether the customer would trust them to do so is perhaps another matter.

Decision

Even if the consumer has taken time to gather information, and evaluate alternatives, and given that supply of electricity is continuous, whether consumers actually act on this is another matter, as it is something that can always be postponed until tomorrow. This provides a particular challenge for suppliers: how to ensure that consumers act promptly in response to the information available to them. Using door-to-door salespeople who require an instant decision on behalf of the consumer may ensure that the decision is not postponed indefinitely but, on the other hand, may be viewed as an aggressive tactic, and alienate consumers. This practice has drawn considerable opprobrium in the electricity and gas industries, and its use has been reduced by several leading companies (Taylor, 1999).

Post-purchase evaluation

After purchasing a good and consuming it, the consumer will evaluate the good’s performance. Where the consumer is satisfied with the good’s performance, repeat purchase is more likely (Szymanski and Henard, 2001). However, for a low involvement purchase such as a utility, it is unlikely that any post-purchase evaluation will be made, unless the performance of the good is unsatisfactory. With a product like electricity, for example, the performance of the product itself is not a matter of question, and so providers will need to convince consumers that there is sufficient price/service differential in their offering to induce the need for change.

The analysis of the consumer behaviour literature suggests, therefore, that, given consumers’ intrinsic inertia, the mundane nature of electricity, and the lack of need stimulus, consumers are unlikely, ceteris paribus, to change suppliers. Is this a conclusion supported by the industry-specific literature?

 

Marketing mix

Marketing, the way most textbooks treat it today, was introduced around 1960. The concept of the marketing mix and the Four Ps of marketing – product, price, place and promotion – entered the marketing textbooks at that time [26]. Quickly they also became treated as the unchallenged basic model of marketing, so totally overpowering previous models and approaches, such as, for example, the organic functionalist approach advocated by Alderson[27, 28] as well as other systems-oriented approaches (e.g. [29, 30]) and parameter theory developed by the Copenhagen School in Europe (e.g. [31, 32]) that these are hardly remembered, even with a footnote, in most textbooks of today. Earlier approaches, such as the commodity (e.g. [33]), functional (e.g. [34]), geography-related regional (e.g. [35]) and institutional schools (e.g. [36]) have suffered a similar fate. Only a few models from these approaches have survived. The American Marketing Association, in its most recent definition, states that “marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchange and satisfy individual and organizational objectives”[37].

Eventually the Four Ps of the marketing mix became an indisputable paradigm in academic research, the validity of which was taken for granted[10, 16, 38]. For most marketing researchers in large parts of the academic world it seems to remain the marketing truth even today. Kent[38] refers to the Four Ps of the marketing mix as “the holy quadruple … of the marketing faith … written in tablets of stone” (p. 146). For an academic researcher looking for tenure and promotion, to question it has been to stick out his or her neck too far. Prospective authors of textbooks, who suggest another organization than the Four Ps solution for their books, are quickly corrected by most publishers. As a result, empirical studies of what the key marketing variables are, and how they are perceived and used by marketing managers, have been neglected. Moreover, structure has been vastly favoured over process considerations[38]. In marketing education, teaching students how to use a toolbox has become the totally dominating task instead of discussing the meaning and consequences of the marketing concept and the process nature of market relationships. Marketing in practice has, to a large extent, been turned into managing this toolbox instead of truly exploring the nature of the firm’s market relationships and genuinely catering to the real needs and desires of customers.

A paradigm like this has to be well founded by theoretical deduction and empirical research; otherwise much of marketing research is based on a loose foundation and the results of it questionable. The marketing mix developed from a notion of the marketer as a “mixer of ingredients”[39]. The marketer plans various means of competition and blends them into a “marketing mix” so that a profit function is optimized, or rather satisfied. The “marketing mix”, concept was introduced by Neil Borden in the 1950s (e.g. [40]), and the mix of different means of competitions was soon labelled the Four Ps[26].

The marketing mix is actually a list of categories of marketing variables and, to begin with, this way of defining or describing a phenomenon can never be considered a very valid one. A list never includes all relevant elements; it does not fit every situation, and it becomes obsolete. And, indeed, marketing academics every now and then offer additional Ps to the list, since they have found the standard “tablet of faith” too limited[41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54]. It is, by the way, interesting to notice that since the Four Ps were definitely canonized some time in the early 1970s, new items to the list almost exclusively have been in the form of Ps[55, 56]. Advocators of the marketing mix management paradigm have sometimes suggested that service should be added to the list of Ps (e.g. [53, 57]). This would be disastrous, because it would isolate customer service as a marketing variable from the rest of the organization, just as has happened with the Four P marketing mix variables. It would effectively counteract all attempts to make customer service the responsibility of everyone and not of a separate department only.

In fact, the Four Ps represent a significant oversimplification of Borden’s original concept, which was a list of 12 elements not intended to be a definition at all. Moreover, the elements of this list would probably have to be reconsidered in any given situation. McCarthy either misunderstood the meaning of Borden’s marketing mix, when he reformulated the original list in the shape of the rigid mnemonic of the Four Ps where no blending of the Ps is explicitly included, or his followers misinterpreted McCarthy’s intentions. In many marketing textbooks organized around the marketing mix, such as Philip Kotler’s well-known Marketing Management[58], the blending aspect and the need for integration of the Four Ps are discussed, even in depth, but such discussions are always limited owing to the fact that the model does not explicitly include an integrative dimension.

In the 1950s in Europe, researchers within the so-called Copenhagen School approached marketing in a similar way to the notion of the marketing mix, based on the idea of action parameters presented in the 1930s by von Stackelberg[59]. Rasmussen[31] and Mickwitz[32] developed what became known as parameter theory, which was a dynamic marketing mix approach linked to the product life cycle and where the parameters were integrated by means of varying market elasticities. Moreover, Mickwitz also stated that the demand side has to be connected to the supply side in a managerial marketing theory. This was done using an economic approach rather than a behavioural approach. Parameter theory was a much more developed model than the Four Ps version of the marketing mix notion. Unfortunately, it never received enough international attention, and eventually it was overwhelmed by the Four Ps that were much easier to comprehend and teach. Today, the key aspects of parameter theory, dynamism and an integration of consumer behaviour and managerial decision making are pointed out as important research topics (cf. [3]).

Probably Borden’s original idea of a list of a large number of marketing mix ingredients that have to be reconsidered in every given situation was shortened for pedagogical reasons, and because a more limited number of marketing variables seemed to fit typical situations observed in the late 1950s and in the 1960s by the initiators of the short-list of four standardized Ps. These typical situations can be described as involving consumer packaged goods in a North American environment with huge mass markets, a highly competitive distribution system and very commercial mass media. However, in other markets the infrastructure is, to varying degrees, different and the products are only partly consumer packaged goods. Nevertheless, the four Ps of the marketing mix have become the universal marketing model or even theory and an almost totally dominating paradigm for most academics, and they have had a tremendous impact on the practice of marketing as well. Is there any justification for this?

 

The nature of the marketing mix

Any marketing paradigm should be well set to fulfil the marketing concept, i.e. the notion that the firm is best off by designing and directing its activities according to the needs and desires of customers in chosen target markets. How well is the marketing mix fit to do that?

One can easily argue that the four Ps of the marketing mix are not well able to fulfil the requirements of the marketing concept. As Dixon and Blois[60, p. 4] put it, “… indeed it would not be unfair to suggest that far from being concerned with a customer’s interests (i.e. somebody for whom something is done) the views implicit in the Four Ps approach is that the customer is somebody to whom something is done!” (Emphasis added). To use a marketing metaphor, the marketing mix and its Four Ps constitute a production-oriented definition of marketing and not a market-oriented or customer-oriented one (see [10, 16]). Moreover, although McCarthy[26] recognizes the interactive nature of the Ps, the model itself does not explicitly include any interactive elements. Furthermore, it does not indicate the nature and scope of such interactions.

The problems with the marketing mix management paradigm are not the number or conceptualization of the decision variables, the Ps, as the American Marketing Association, as well as the authors of most publications criticizing the marketing mix management paradigm, argue. Rather, the problem is of a theoretical nature. The Four Ps and the whole marketing mix management paradigm are, theoretically, based on a loose foundation, which in a recent Journal of Marketing article was also demonstrated by van Waterschoot and Van den Bulte[61]. They conclude:

To our knowledge, the classification property(-ies) or rationale for distinguishing four categories labelled “product”, “price”, “place” and “promotion” have never been explicated … Though casual observation of practitioners, students, and textbooks suggest a general consensus to classify marketing mix elements in the same categories, the lack of any formal and precise specification of the properties or characteristics according to which marketing mix elements should be classified is a major flaw.

Van Waterschoot and Van den Bulte[61, p. 85] recognize three flaws in the Four Ps model:

The properties or characteristics that are the basis for classification have not been identified. The categories are not mutually exclusive. There is a catch-all subcategory that is continually growing. (See also [38, 62].)

Many marketing-related phenomena are not included [63]. Moreover, as Arndt[64, 65] has concluded, marketing research remains narrow in scope and even myopic, and methodological issues become more important than substance matters:

Research in marketing gives the impression of being based on a conceptually sterile and unimaginative positivism … The consequence … is that most of the resources are directed toward less significant issues, overexplaining what we already know, and toward supporting and legitimizing the status quo [64, p. 399].

Unfortunately, far too little has changed in mainstream marketing research since this was written over a decade ago.

The usefulness of the Four Ps as a general marketing theory for practical purposes is, to say the least, highly questionable. Originally, although they were largely based on empirical induction and earlier lists of marketing functions of the functional school of marketing (cf. [66]), they were probably developed under the influence of micro-economic theory and especially the theory of monopolistic competition of the 1930s (e.g. [67]), to add more realism to that theory. However, very soon the connection to micro-economic theory was cut off and subsequently totally forgotten. Theoretically, the marketing mix became just a list of Ps without roots.

Even in the area of consumer goods marketing in North America, some doubts concerning marketing mix management has been expressed. Regis McKenna[68], a respected marketing consultant and writer, concludes in a discussion about the decline in North America of advertising, the flagship of traditional marketing, that: the underlying reason behind … (this decline) … is advertising’s dirty little secret: it serves no useful purpose. In today’s market, advertising simply misses the fundamental point of marketing – adaptability, flexibility, and responsiveness (p. 13).

Undoubtedly, this is to take it a little bit to the extreme, but the point is well taken. An interest in turning anonymous masses of potential and existing customers into interactive relationships with well-defined customers is becoming increasingly important (see, for example [68, 69, 70]).

 

Consequences of the marketing mix

Managing the marketing mix makes marketing seem easy to handle and organize. Marketing is separated from other activities of the firm and delegated to specialists who take care of the analysis, planning and implementation of various marketing tasks, such as market analysis, marketing planning, advertising, sales promotion, sales, pricing, distribution and product packaging. Marketing departments are created to take responsibility for the marketing function of the firm, sometimes together with outside specialists on, for example, market analysis and advertising. Both in the marketing literature and in everyday marketing vocabulary the expression “marketing department”, and organization unit, is used as a synonym for marketing function, which is the process of taking care of the fulfilment of customer needs and desires. However, the organizational approach inherent in the marketing mix management paradigm is not very useful either (see e.g. [15, 16, 71, 72, 73]). The psychological effect on the rest of the organization of a separate marketing department is, in the long run, often devastating to the development of a customer orientation or market orientation in a firm. A marketing orientation with, for example, high-budget advertising campaigns may be developed, but this does not necessarily have much to do with true market orientation and a real appreciation for the needs and desires of the customers. The existence or introduction of such a department may be a trigger that makes everybody else lose whatever little interest in the customers they may have had[15]. The marketing department approach to organizing the marketing function has isolated marketing from design, production, deliveries, technical service, complaints handling, invoicing and other activities of the firm. As a consequence, the rest of the organization has been alienated from marketing. Therefore, it has made it difficult, often even impossible, to turn marketing into the “integrative function” that would provide other departments with the market-related input needed to make the organization truly market oriented and reach a stage of “co-ordinated marketing” (cf. [72, pp. 19-24]).Furthermore, the marketing specialists organized in a marketing department may get alienated from the customers. Managing the marketing mix means relying on mass marketing. Customers become numbers for the marketing specialists, whose actions, therefore, typically are based on surface information obtained from market research reports and market share statistics. Frequently, such marketers act without ever having encountered a real customer.

The marketing department concept is obsolete and has to be replaced by some other way of organizing the marketing function, so that the organization will have a chance to become market-oriented. A traditional marketing department will always, in the final analysis, stand in the way of spreading market- orientation and an interest in the customer throughout the organization (cf. [15, 16, 71, 72]).

Sometimes the term marketing has become a burden for the marketing function. Managers as well as their subordinates in other departments and functions do not want to take part in the marketing function. But, according to the relationship marketing approach and contemporary models of industrial marketing and service marketing, they do undoubtedly belong to this function. The use of the marketing mix management paradigm and the Four Ps has made it very difficult for the marketing function to earn credibility. Some firms have solved this problem not only by downscaling or altogether terminating their marketing departments but also by banning the use of the term marketing for the marketing function (cf. [15]). Perhaps we even need this kind of semantics.

 

Contemporary theories of marketing

In most marketing textbooks the marketing mix management paradigm and its Four Ps are still considered the theory of marketing. Indeed, this is the case in much of the academic research into marketing, especially in North America but also to a considerable extent in other parts of the world as well. However, since the 1960s, alternative theories of marketing have been developed. As Möller[63] observes in a recent overview of research traditions in marketing:

from the functional view of marketing “mix” management our focus has extended to the strategic role of marketing, aspects of service marketing, political dimensions of channel management, interactions in industrial networks; to mention just a few evolving trends” (p. 197).

Some of these theories have been based on studies of the market relationships of firms in specific types of industries. In this section the emerging theories and models of the interaction/network approach to industrial marketing and the marketing of services will be discussed. The growing interest in focusing on customer relationship economics and the long-term profitability of customer retention and market economies will also be touched on.

 

Relationship of Mkt MIX and Consumer Attitude

The practical implications for marketing strategies that result from understanding the consumer attitude factor were address. (David L. Loudon & Albert J. Della Bitta).

In general, all three components of an attitude tend to be consistent with each other. Thus, if marketing managers can influence one component, the other components may also be influenced (Del I. Hawkins).

 

Consumer attitudes toward marketing activities are important from both a theoretical and a managerial standpoint (Gaski and Etzel, 1986). The advent of an organized consumerism movement in the USA during the 1970s led to tremendous interest among researchers in studying the attitudes of consumers toward business (Gaski and Etzel, 1986). As consumer perceptions significantly affect their behavioral responses to marketing activities, consumer attitudes toward marketing have been found to be linked to several key macroeconomic variables and have been used in economic forecasts (Chopin and Darrat, 2000). Such information can also help in the formulation of effective strategies for companies and the development of policies by government agencies to regulate industries and to protect consumers’ interests. While some researchers have assessed the overall attitude of consumers toward marketing (Gaski and Etzel, 1986; Varadarajan and Thirunarayana, 1990), others have dealt with consumer attitudes toward specific marketing activities such as advertising and pricing (Nwachukwu et al., 1997; Webster, 1991). In general, researchers have asked the following three questions:

  1. How do consumers perceive marketing in a specific economy?
  2. Are there significant differences in consumer attitudes toward marketing?
  3. And if so, what factors explain such differences?

Barksdale and Darden (1972) pioneered the research on consumer attitudes toward marketing in the USA and replicated their study for a number of years in the 1970s. They measured consumer attitudes toward the four marketing mix variables, consumerism, government regulation, and consumer responsibility. Overall, they found that consumers had rather negative attitudes toward marketing practices. Later, Gaski and Etzel (1986) modified the Barksdale scale and labeled it as the Consumer Sentiment toward Marketing. They found that although the attitudes of US consumers toward marketing were negative, the reputation of marketers had shown improvement over time. Their results also suggested that women perceived marketing more positively than did men. In another study, Webster (1991) found significant differences in consumer attitudes toward various marketing practices including product, pricing, advertising, and retailing or selling; however, many of the differences remained even after social class and income effects were removed. Therefore, the factors that explain the differences in consumers’ attitudes need clarification.

Recently, several researchers have found that a number of other factors influence consumers’ attitudes toward marketing. Treise et al. (1994) examined the perceptions of familiar advertising controversies: targeting practices and message strategies. Their results show that consumers believe that advertising often violates broad ethical norms. In addition, the degree to which consumers judge advertising as ethical or unethical varies as a function of their ethical philosophies, such as relativism and idealism (Treise et al., 1994). Nwachukwu et al. (1997) found that perceptions of individual autonomy, consumer sovereignty, and the nature of the product played significant roles in consumers’ ethical judgment of advertising and marketing.

The major problem with the marketing mix and its Four Ps has been their position as the major, and in many situations as the only, acceptable marketing paradigm. Relationship marketing must not become such a straitjacket. However, developing enduring customer relationships and achieving exchanges in such relationships through a relationship marketing approach (cf. [115]) is not only another addendum to marketing mix management. Rather, it is a different approach compared to achieving exchanges in isolated transactions through the use of the Four Ps of the marketing mix. As Reichheld observes, “building a highly loyal customer base cannot be done as an add-on. It must be integral to a company’s basic business strategy”[86, p. 64]. Hence, it should be useful to think about possible marketing approaches or strategies along a marketing strategy continuum[116]. Relationship marketing is placed at one end of the continuum. Here, the general focus is on building relationships with customers (and other parties as well, although only customers are discussed in this context). At the other end of the continuum is transaction marketing where the focus of marketing is on one transaction at a time (cf. [4]). Thus, marketing revolves around creating single transactions or exchanges at a time and not around building long-term relationships. The continuum and some marketing and management implications are illustrated in Figure 1.

Various types of goods and services can be placed along the continuum as indicated by the bottom part of Figure 1. The exact place and corresponding marketing approach cannot, of course, be located. This is indicated by the arrows. Marketers of consumer packaged goods will probably benefit most from a transaction-type strategy. Service firms, on the other hand, would normally, but probably not always, be better off by applying a relationship-type strategy. Manufacturers of consumer packaged goods have mass markets but no immediate contacts with their ultimate customers, while service firms almost always have such contacts, sometimes on a regular basis, sometimes only at discrete points in time. Therefore, the interface between the firm and its customers is expanded far outside the marketing department of marketing and sales specialists.

In consumer durables the customer interface is broader than for consumer packaged goods, and a pure transaction-type strategy is not the only naturally available option. Industrial goods, ranging from mass-produced components to complex machines and projects, would probably fit best between consumer durables and services. However, in many industrial marketing situations the customer relationships are similar to many service situations, and here no distinctions between the industrial marketer and service marketer can be made on the continuum.

 

The time perspective of marketing differs depending on where on the continuum a firm is. As transaction marketing means that the firm focuses on single exchanges or transactions at a time, the time perspective is rather short. The unit of analysis is a single market transaction. Profits are expected to follow from today’s exchanges, although sometimes some long-term image development occurs. In relationship marketing the time perspective is much longer. The marketer does not plan primarily for short-term results. Their objective is to create results in the long run through enduring and profitable relationships with customers. In some cases, single exchanges may even be unprofitable as such. Thus, relationships as such are equally the units of analysis.

The quality customers perceive will typically differ, depending on what strategy a firm uses. According to the model of total perceived quality developed within the Nordic School of Services[15, 117, 118]) the customer-perceived quality is basically a function of the customer perceptions of two dimensions: the impact of the outcome or the technical solution (what the customer receives), and an additional impact based on the customer’s perception of the various interactions with the firm (how the so-called “moments of truth”[119] are perceived). The former quality dimension is sometimes called the technical quality of the outcome or solution, whereas the latter dimension is called the functional quality of the interaction process[15].

A transaction marketing approach includes no, or minimal, customer contacts outside the product and other marketing mix variables. The benefits sought by the customers are embedded in the technical solution provided by the product. The customer will not receive much else that will provide them with added value, other than perhaps the corporate or brand image in some cases. Hence, the technical quality of the product, or what the customer gets as an outcome, is the dominating quality-creating source in transaction marketing.

In relationship marketing the situation is different. The customer interface is broader, and the firm has opportunities to provide its customers with added value of various types (technological, information, knowledge, social, etc.). Hence, the second quality dimension, how the interaction process is perceived, grows in importance. When several firms can provide a similar technical quality, managing the interaction processes becomes imperative also from a quality perception perspective. Thus, in relationship marketing the functional quality dimension grows in importance and often becomes the dominating one. Of course, this does not mean that the technical quality can be neglected, but it is no longer the only quality dimension to be considered as one of strategic importance.

Chapter 2

Study Approach

In order to make this report I visit three showrooms of Otobi furniture. I collected information from them by questionnaire. After that I make a questionnaire for the general people to know their perception, belief, attitude and lifestyle. I made of all analysis by their answers of those questions. Different tables and graphs were prepared to gain a better view of the consumer’s perception. Microsoft Word, Microsoft Excel and SPSS software are used for this purpose. After the analysis I suggest the strategies. I may also collect data by reading journals and magazine by library researching or selecting two firms, observing their performance in furniture market or I can take report made in this topic in the past. But I did not take these policies. I made the analysis of this report by Questionnaire survey methods. At last I select some people as sample and made this report.

Problem Faced With Methodology

I faced some problem with this methodology. The questionnaire was a very critical one. As a result most of the despondences made mistake to fill it. Not only has that it taken to much time to understand the questionnaire by all the despondence though I always try to tell the format of the whole questionnaire as easy as possible. And most of all I am working with sample. As a result the whole analysis may not fully correct.

Information Need

For making this report I need the information about the profile of Otobi Furniture, their marketing and promotion strategy, their competition and competitor, on which variables they are giving much importance, their turnover, target achieved and their average net profit.

Sampling Plan

 

For getting my respondents I visited two corporate houses and an apartment building. Some of my samples come from the different professional group and other samples come from our university faculties and student.

 

Sample Characteristics

I collected information for this report mainly from primary survey. I selected 60 people as sample. Among them 38 were male and rest of them are females. 28 of them fall under the 20-29 age group, 16 under the age 30-39, 9 under the age 40-49 and 7 of them are under the 50-Above group.

 Chapter-3

Introduction

 

Otobi Furniture a part of Otobi Group is one of the market leaders of furniture market of Bangladesh. They started their business in Bangladesh in the year 1975 with the slogan “Trusted across the World”. And now they crossed the boundary and operating business also in India. They are assuming themselves as the market leader for last 10 years. Though their price is a bit higher but as they provide the best quality furniture people are ready to get that with any cost. Not only that they have the biggest brand image in our country. They have already earned the first place in the office furniture. That is why now a day corporate office means, furniture from Otobi. Otobi furniture a part of Otobi limited which is a combination of four different types of business. They are as follows,

v  Otobi Furniture: Combination of office and furniture.

v  Home appliances: Washing Machine, air conditioner

v  Carpet: under:  Appolo Limited.

v  Decorative Light: Also under Apolo Limited.

Otobi furniture has the biggest collection of furniture like world class chair, world class computer furniture, world class home furniture, world class table, world class swivel chair and file cabinet and plastic furniture. Otobi furniture was given the award of enterprise of the year 2001. Beside their corporate office in Dilkhusha, Dhaka, they have 8 sales and display center in Dhaka and Chittagong city and around 100 dealers in the whole country. They have about 16 outlets outside the country.

 

Mission of Otobi Furniture:

 

The mission of Otobi Furniture is “To provide the middle class and higher middle class people of the country world class furniture in a very comfortable price.”

Historical Background:

Otobi Furniture stared its journey in the year 1975. They have a huge past records to tell. They are the market leader in the furniture industry for the whole last decade. We know that otobi furniture is a part of Otobi limited which was the creator of SAARC Foara of Karwanbazar, Sculpture of Rajshahi University, and Sampan of Chittagong Airport. All this are the biggest symbolic assets of our country. In fact the architect of these sculptures was Mr. Nitun Kundu who was the father of Mr. Onimesh Kundu, the Managing Director of Otobi Limited.

Sales Volume:

 

Otobi Furniture has an unbelievable sales amount in the prospect of Bangladesh. They have a sales volume of Tk. 15 crore per month that means, they have a sales of about one hundred and eighty crore taka per month which is bigger than any other furniture company of Bangladesh. Among the sales after deducting all the expenses they have about 20% profit per year. That means they have a profit of Tk. 46 crore per year which is unbelievable in the prospect of Bangladesh. Not only as they are planning to increase the business in Bangladesh and outside Bangladesh we expect that the amount will be bigger in the future.

Future Plan:

 

The future plan of Otobi Furniture is to expand their sales not only in Bangladesh but also outside the country. Their primary target is India, Singapore and Malaysia.

Competitors:

The competition in the furniture market is increasing day by day as so many new firms are coming in the market. As a result, Otobi Furniture is facing a huge competition now a day. Their main competitors are,

v  Navana Furniture

v  Partex

v  Studio 45

v  Hatil

v  Tanin

v  Legacy

Chapter-4

Products:

 

We know that Otobi is the biggest furniture brand of our country. They have about 26 different types of furniture. Not only that Otobi furniture is the symbol of status now a day. Most of the big corporate house now purchasing their office furniture from Otobi. They provide both customize and standardize product. For customize product a buyer give the order and Otobi produce according to that and in case of standardize product Otobi make the product itself and keep it in the outlet for buying of the people. Among the 26 different brands the main brands of Otobi are,

  • Ø World Class Chair
  • Ø Computer Table
  • Ø Home Furniture
  • Ø Table & File Cabinet

Most of these products has different slogan to establish themselves in the mind of the people. They are,

World Class Chair

Chair that satisfies your need.

Table

Create your ideal office environment

Swivel Chair

Beauty you can See

Home Furniture & File Cabinet

World Class Furniture

Not only that they also take the orders for kitchen fittings. The main advantages with the Otobi products are,

v  Multiple colors

v  Knock Down System

v  Elegant Design

v  Competitive Price

v  After Sales Service

Beside all this lamination board furniture they have already introduce Plastic and Wooden furniture.

Price:

 

We know that Otobi now a day is one of the symbols of status. The price of Otobi furniture is a bit higher than that of the competitors. According to the officials of the outlet of Otobi “As they are giving the best quality raw materials in each furniture their price is a bit higher.” They also told us that they import each of the raw materials from the country where they get the best one. But according to them though their raw materials are more costly than their competitors their price is competitive. The price range of different furniture are given below,

Table: Price Range of the different products of Otobi Furniture

Products

Price range

Chair

Tk. 970 – 18,000

Table

Tk. 4,600 – 40,500

File Cabinet

Tk. 8,900 – 65,500

Bed

Tk. 9,900 – 40,000

Dinning Table

Tk. 5,300 – 16,500

According to the officials of the Otobi Furniture their price is depends on the quality of raw materials, high technological machineries and overhead cost.

Place:

The target market area of Otobi Furniture is the metropolitan city area. In fact the main target area is the Dhaka city and Chittagong city. For that reason all the showrooms of Otobi furniture is in these two cities. The addresses of the showrooms are,

  • Otobi Corporate Office: 14 Dilkusha Commercial Area Dhaka 1000
  • Otobi Center: Plot 12 Block CWS (C) Gulshan South Avenue Gulshan 1 Dhaka 1212
  • Elephant Road: 230 New Elephant Road Dhaka
  • Gulshan: SE(F) 3 Gulshan Avenue Dhaka
  • Uttare: House # 21 Road #7 Sector # 4 Uttara Model Town Dhaka
  • Shewrapara: 923 Begum Rokeya Sharani Mirpur Dhaka
  • Panthapath: D. H Tower 129 Panthapath Dhaka
  • Chittagong: Zohora Tower, 1401, Agrabad C/A, Chittagong 1400

Beside these showrooms Otobi has about 100 dealers all over the country to sale and promote their furniture. Not only that they have about 16 outlets outsides the boundary of the country. Their factory is situated in Savar, Dhaka which is bigger than all other furniture factory of the country. They use their own van to distribute their furniture in the country.

Promotion:

All the firms try to keep their brand on the top ladder of the people mind by its promotional activities. Otobi also has its own promotional activities to keep itself on the top of the people’s mind of Bangladesh. Otobi use both ATL (above the line: TV, Newspaper, Direct Selling) and BTL (Poster, Banner, Neon Sign) promotional strategies. But for a product like furniture “Above the Line” promotional strategies specially direct selling, are the main one.

Direct Selling:

 

Otobi Furniture has some very skillful and experienced marketing executives. Usually they go to the big corporate houses of Dhaka and Chittagong city with their leaflets and other promotional tools. In this case they try to describe the advantages of the furniture of Otobi and try to sell as many as furniture possible.

The descriptions of the Otobi Furniture’s TV and paper ads are explained below.

Banner:

The banner is specially made because of the present Rainy season. In fact they use another ATL strategy in the banner. To promote the sales in this season they give 10% discount to all the furniture. This information and their showrooms are given in the banner.

Paper ad:

The paper ad basically shows the high status of Otobi Furniture. In this paper ad Otobi use their slogan “Barashar char” That means the furniture of Otobi has a biggest status and prestigious image that people are buy Otobi furniture with seasonal discount. Not only that as when International trade Fair was on going the special offer 15% discount was also mentioned in the newspaper ad.

TV ad:

The TV ad also shows that people are motive to buy the furniture in the Rainy season. Then a person says “Apni Kinchen Kobe?” This ad shows that Otobi’s Furniture are so good that one people motivate the another people to buy the product with seasonal desire.

People:

Otobi has very skilled and efficient human resources to run its business. The whole firm is lead by the Managing director of Otobi. About two thousand and five hundred employees are working with Otobi Furniture now. The top three post of Otobi is occupied by,

Managing Director

Omiti Kundu

Chief Executive Officer

Mr. Sabbir Hasan Nafiz

Head of Marketing

Mr. Saleh Muzahed

There are about two thousand five hundred employees are working with Otobi Furniture now. A huge percentage of the total employees are working in the Savar and shyumpur factory of the Otobi Furniture and others are working in the showrooms of the Otobi.

The employee flowchart of Otobi Furniture is given below

                                                                          Managing Director

Marketing Strategy of Otobi Furniture Selecting Appropriate

Figure: Employee flowchart of Otobi Furniture

Packaging:

It is not possible to give packaging for furniture. But after purchasing the furniture they rapped the whole furniture or the sensitive portion by the plastic raping paper.

With the survey findings, I attempted to draw a profile of the target market.

Chapter 5

Age, Sex and Family Member

Otobi Furniture is marketing one of the best quality furniture in Bangladesh. They are mainly promoting their products to the corporate houses as well as houses. In this factor age is not a big consideration as purchasing of furniture in a corporate house made by the officials who involve with purchase or the directors. Their age may be 25, it may also 55. Not only that purchasing home furniture in home may be influence by the father, mother or may be the children. So here we also find a big age range. And same we can say about the sex. The purchase may be influence by male or it may influence by female. As people do not buy furniture impulsively and it is a high involvement product in most cases these demographic factors is not working like the other products. As the family member influence the buying of furniture we also try to know the number of family members of our respondents. We found that 27% respondent has a family of 2 to 4 persons, 47% respondent has a 5 to 7 persons, 23% respondent has 8 to 10 persons and 3% has 11 or more than that.

 

Social Class

The social class of the target market was determined according to their family income. From the figure we can see that 45% people are coming from the income level of Tk. 15001 to Tk. 40000. We will call them middle class. This percentage is bigger in size. 27.5% are from the income level of Tk. 40001 to Tk. 75000 who is the upper class, 10% are from Tk. 75001 to Tk. 100000 who are upper class and at last 17.5 % are from the income level of Tk. 15000 or less who are the lower class. So we found that most of the members of the target market are from middle and upper class people. But when we make the average we find that the average income of our respondents is more than Tk. 40000 but less than Tk. 75000.

 

My survey also found the social class of the people by their occupation and the educational qualification. And I find that from our respondents 8% has educational qualification of College, 57% has educational qualification of graduate, 19% has postgraduate, 3% has PHD and 13% has other types of educational qualification.

And our respondent’s occupation table is given below,

Table: Occupation of the Respondents

Occupation

 

Frequency

Businessman

13

Service Holder

16

Teacher

3

Doctor

2

Lawyer

3

Student

15

Housewife

8

Shopping Activity

Number of shopping also reflects the social class of a person. Because if you are a person of higher class you should have a higher number of shopping and it will decrease in middle class and lower class respectively. From my respondent I found that, 30% of our respondents shop once a month, 35% of them shop twice a month, 10% of them shop once a week and 25% shop more than four times a month. After the average we found that our target market has a habit to shop more than twice a month but not more than once a week.

Table: Shopping Activity of the Respondents

Shopping Time

 

Frequency

Once a Month

18

Twice a Month

21

Once a Week

6

More than Four a Month

15

Shopping Place

Sopping place is now a symbol of status for the people of our country. As a result we are able to find out the social class from the shopping place habit of the people. 64% of our total respondents shop usually from Eastern Plaza, Riffles Square and New Market. We can categories them in middle class group. And remaining 36% shop from Bashundara City. We can categories them in upper class.TV Channel, Clothing, Food Habit, Shopping Place are the cultural indicators that influence the behavior of the people more.

TV Channel

The choice of the TV channels has sufficient effect on the cultural preference of the target market. From our findings of the survey I get that foreign TV channel has a big impact on the people’s mind of our country. It also promoting the foreign culture to our country especially Indian culture in the young generation and in female more. Among those respondent 17 % like music channel, 24% like Bangla Channel, 21% prefer Informational choice, 15% prefer sports and 6% prefer Hindi channel.

Table: Favorite TV Channel of the Respondents

Channel

 

Frequency

Music Channel

10

Bangla channel

14

Information

13

News

10

Sports

9

Hindi

4

Clothing

Clothing shows the cultural values as well as the social status of a person. That is why clothing is an important indicator of the cultural view or social status. In this case now a day people clothing behavior is frequently changing by the effect of the Indian serial.

Table: Favorite Brand of Cloth

Channel

 

Frequency

Cats Eye

14

Pride & Dandy

5

Raymonds & Century

6

Levis & Rex

7

Monsoon & Soul Dance

4

Body shop

10

Artisti

4

Shada Kalo & Arong

5

                    Others

5

Eating Place

The intension to take foods outside is increasing at the present time which shows that our culture is changing as the western culture. Though this habit is only for the urban areas all of our target market lives there.

Table: Favorite Eating Place

Eating Place

 

Frequency

Pizza Hut

15

American Burger

8

Midnight Sun

8

Boomers

12

Hazi Biriani

10

Others

7

From our respondent we found that only 12.5% people response about the local food item. And all other mentioned about the fast foods or the Chinese restaurants.

Culture is the distinctive way of life of a group of people, their complete design for living. Cultural factors play a very important role for purchasing any kind of product. Without matching with the culture a product is not able survive in the market.

 

Relevant Cultural Values

The important values that affect the purchase of Otobi Furniture are,

v  Status: Status is one of the cultural values that effect the purchasing of Otobi Furniture. We know that decorating a house or a corporate office by the lamination board furniture is the symbol of status now a day. As a result, people are buying lamination board furniture. As Otobi is the oldest brand people already have a believe that their quality is good. So most of the time they prefer to buy from Otobi.

v  Non-Traditional: We know that people are like to change their lifestyle now a day. As a result most of the people now switching from the traditional wooden furniture to lamination board furniture.

v  Being good to myself concept: We know that being good to myself concept is cherished by all in the society. As a result now people are thinking if they have money they will buy the expensive and exclusive products for their use. As a result, Lamination board furniture purchasing is increasing.

v  Fashionable: For making a home into sweet home people are now expensing a lot for its fashion and design. And it is possible for only lamination board furniture to provide more fashionable and stylist products. So lamination board furniture purchasing is increasing.

Gender Roles

Gender difference has got a very little role to play in the case of choice of purchasing furniture because the influence of purchasing furniture from Otobi may come from any gender of a family or a corporate house. As a result I did not find any relationship with purchasing of furniture with gender.

Chapter-6

Group Influence

Purchasing furniture is sometime a group decision and sometime an individual decision. It is also a high-involvement product. When furniture is purchase for corporate house it is a decision where group has some influence in some cases but some cases it is an individual decision. Not only that when it is purchase for household purpose again some is individual decision and some are group. In case of household purpose it can be influence by the purchase of anyone’s reference group members.

Types of Influence

 

Only Identification influence might be present in the purchase of furniture.

Identification Influence:

Identification influence is also called value-expressive influence, occurs when individuals have internalize the group’s values and norms. These then guide the individuals’ behaviors without any thought of reference group sanctions or rewards.

We know that furniture is now a symbol of status. So people are using lamination board furniture to show their status to the other people.

 

Degree of Reference Group Influence

It is a visible and necessary product. So the reference group influence should have been high in both product & Brand as it signifies the personality.

 

Ad Strategy

As the reference group influence is high, Otobi should show ads where it will more reflect the prestigious, high status and exclusive products. Show people like you having furniture from Otobi, it will signify the status and prestige he have. It may be an option of Otobi to use the group influence that is present in the choice of lamination board furniture.

Otobi Furniture affects the consumers’ information processing process by exporting them to stimuli, gaining their attention, making those stimuli those easy to interpret, making them learn and finally installing the stimuli in the memory of the consumer.

Perception is the constitute of first three steps of information processing (Exposure, Attention and Interpretation)

Chapter 7

Exposure

Otobi Furniture is trying to expose itself to its target market through various means. They are,

v  TV: Otobi Furniture has placed TV advertisement quite frequently in the few years ago. But now a day number of advertisement is decreasing day by day. The reason may be the new ads are coming.

v  Newspaper: Otobi Furniture placed its advertisement in the newspaper also but not frequently now.

v  Banner: Some banner is shown in the different areas of Dhaka city just to give a reminder about the Pavilion no and special discount offered by the Otobi furniture in the International Trade Fair.

v  Direct Selling: Direct selling is the most effective strategy for giving exposure to the people. Because by direct selling people can easily now a lot about the product form the officials who involve with that.

Attention

Attention occurs when the stimulus activities one or more receptor nerves and the resulting sensations go to the brain for processing. Otobi Company tries to gain attention mainly through the following ways:

  • Stimulus Factors: The stimulus factors that Otobi uses are,

v  Size: Big news paper ad and banner are the best example of this stimulus factor.

v  Color and Movement: The paper ads are very colorful with the picture of their products.

v  Position: In newspaper the usually place their ads at the middle in the last page or middle in the third page where possible to give colorful ads. It helps to attract the people’s attention easily. They also positioned their banner in a very attractive way. For example, When the International Trade Fair was going we find so many banner of Otobi Furniture brand with the discount offer in all the prime places of Dhaka city on an eye sight height.

v  Information Quality: In all of the banners, Television ads and paper ads Otobi just try to promote their discount offer 10% or “15% discount”. It is a good strategy as it is a high involvement product.

  • Individual Factors: Individual factor is not a very important indicator in this case as it is not an impulsive product. As a result the only way to influence the purchasing decision is direct selling. And Otobi is doing so by sending their executives to the corporate houses.
  • Situational Factors: Situational factors include stimuli in the environment other than the focal stimulus and temporary characteristics of the individual that are induced by the environment, such as the time pressures or a crowded store. For example, consumers pay less attention to a commercial in a commercial in a large cluster of commercials than they do to one in a smaller set. Considering that Otobi’s ads are smaller in size to attract people attention.

Non-Focused Attention

 

  • Hemispheric Lateralization: Otobi is trying to influence the left side of the brain. It used symbolic representation in its ads.

Interpretation

Interpretation is the assignment of meaning to sensations. The factors that effect the interpretation of Otobi Furniture are the following,

  • Individual Characteristics:

Expectation: Individuals interpretation of stimuli tends to be consistent with their expectations. Considering the old saying “First impressions matter” Otobi Furniture decorate their showrooms in a furnished way. Not only that their set of expectations also depends on the behavior of the salesperson. As a result, Otobi give their executives training about the behavior of the consumer.

  • Situational Characteristics:

Logo: The logo that used by Otobi Furniture is the symbol of “Trust” as they used their slogan “Trusted across the World” use in the logo.

Learning is the term used to describe thee processes by which memory and behavior are changed as a result of conscious and nonconscious information processing.

Relevant Learning Theories

  • Classical Conditioning: The classical conditioning is taking place in the advertisements of Otobi Furniture as they show the status and prestigious issue there.
  • Operant Conditioning: Discount is given in the Rainy season to promote the sales of Otobi.
  • Iconic Rote Learning: Otobi is placing their ads and remaindering their customers that it is a prestigious product.

Characteristics of Learning

  • Strength of learning: The following indicators are important to determine the strength of learning.

v  Importance: Otobi Furniture is a high involvement product. That is why result is high in this case.

v  Reinforcement: Otobi Furniture tries to increase the purchase with the best quality, durability and strong brand image.

v  Repetition: The number of Otobi’s ads showing everyday in the television is very low. Though they have the strongest brand image they should give more ads in television and in newspaper.

v  Mood: Otobi Furniture always gives positive mood during the presentation of the ads.

Memory is the total accumulation of prior learning experience. It consists of two interrelated parts: Short-term and long-term memory. Both types are influence by the Otobi Ads.

Short-term Memory

 

Short-term memory has a limited capacity to store information and sensations. Two basic types of information processing activities occur in short-term memory. They are,

  • Elaborate Activities: The previously stored experiences, attitudes, beliefs such as Otobi furniture is the symbol of status, prestige and fashion.
  • Maintenance rehearsal: The repetition of banner in the same road (Bijoy Soroni) is a good example in this regard.

 

Long-term Memory

Long-term memory is viewed as an unlimited, permanent storage. The three basic types of long-term memory for which marketers are interested are given below,

  • Semantic Memory: Semantic memory is the basic knowledge and feelings an individual has about a concept. In the case of Otobi Furniture, it is a stylist, non-traditional and exclusive products.
  • Episodic Memory: This is the memory of a sequence of events in which a person participated. In this case a person’s office room and home both may be furnished by Otobi Furniture. So he is using Otobi in his whole day life.
  • Schematic Memory: Memory can be changed and shaped as it is accessed. Memory of an actual event may be altered as new or additional information about that event is received. The schematic memory of Otobi Furniture is given below:

 

In our country most of the people yet buying wooden furniture though wooden furniture are heavy in weight and unfriendly to use. But in some cases this believe is changing rapidly and people are moving towards lamination board furniture. But the good news is that most of them prefer Otobi Furniture as it is the oldest and biggest furniture brand of our country. But as the market is open some new and competitive brand has come in the market. As a result, Otobi furniture is facing a huge competition as people as substitute products now.

Once upon a time in people’s mind it was set that furniture brand means Otobi. But it has replaced in some cases. As other brands are also providing about similar quality level price in a bit lower price. We know that Otobi mainly targets the Office furniture. Some of the big corporate house is also using Otobi. Most of the time these purchase influences by the decision of the officials involve in purchasing. And about home furniture, most of the cases anyone of the family can influence the purchase decision. Another thing we noticed that the advertisement in the television about all the furniture brands are lower than any other industry. As a result, advertisement does not influence much. Another important factor that influencing the purchase of lamination board furniture is lamination board furniture is now the symbol of status now a day. So for making a corporate house prestigious and exclusive one or decorating a home more fashionable and non-traditional people are now buying lamination board furniture.

Otobi is the market leader in the furniture industry. So it has already created a favorable attitude in the top ladder of the mind of the target customers. They have already created an emotional relationship with the people. But before trying to influence their attitudes, first it needs to measure the cognitive, affective and behavioral attitude towards Otobi Furniture.

The cognitive component consists of the belief that the people have towards different furniture. To measure the cognitive component towards Otobi Furniture we asked consumers to place beliefs about two products of Otobi and their ideal furniture in a semantic scale. To fully evaluate it we also asked them to place their beliefs about two products of Navana Furniture as they are the main competitors of Otobi. We thus compared Otobi’s Chair with Navana’s Chair and Otobi’s File Cabinet with Navana’s File Cabinet. We then took the simple average of the respondents’ beliefs towards the furniture of Otobi and Navana on each factor. The position of these averages on the scale, the weighted of each factor and final results are given below for each type of furniture.

(i)                 Otobi Chair Vs. Navana Chair

Low Price           ____  ____   __I_   ____   __N_   __O_   ____        High price

Comfortable       ____  ____   _OIN   ____   ____   ____   ____        Less Comfortable

High Status        ____  __O_   ____   _NI_   ____   ____   ____         Low Status

User Friendly     ____  ____   _OIN   ____   ____   ____   ____        Less User Friendly

Fashionable        ____  __O_   __N_   __I_   ____   ____   ____        Common

(Here I = Ideal Chair, O = Otobi Furniture and N = Navana Furniture)

Giving a weight of 30% to price, 25% to comfortability, 15% to status, 15% to friendliness and 15% to Fashionable we find,

  • Attitude towards Otobi Chair 1.5
  • Attitude towards Navana Chair 0.75

(ii)               Otobi File Cabinet Vs. Navana File Cabinet

Low Price           ____  ____   __I_   ____   _N__   __O_   ____        High price

Comfortable       ____  ____   _OIN   ____   ____   ____   ____        Less Comfortable

High Status        ____  __O_   _N__   __I_   ____   ____   ____         Low Status

User Friendly     ____  ____   _OIN   ____   ____   ____   ____        Less User Friendly

Fashionable        ____  __O_   __N_   __I_   ____   ____   ____        Common

(Here I = Ideal Chair, O = Otobi Furniture and N = Navana Furniture)

Giving a weight of 30% to price, 25% to comfortability, 15% to status, 15% to friendliness and 15% to Fashionable we find,

  • Attitude towards Otobi file cabinet 1.5
  • Attitude towards Navana file cabinet 0.90

The above analysis shows that the consumers’ belief about Otobi Chair and Otobi File Cabinet is not favorable than the Navana Chair and Navana File Cabinet. The reason of this is the price according to the respondents. The price is one of the main factors to buy furniture. Not only that in case of status and fashionability Otobi is providing more than the ideal one. But in this case Otobi Chair is more favorable than the Otobi File Cabinet.

The affective component reflects the emotional reaction towards a particular product. As an old and established product Otobi Furniture has a very good emotional relationship with people. Though a lots of new brands are coming, 67.5% of our total respondents says that Otobi is the furniture brands that come to their mind when the think about any types of furniture. To measure the affective component, a likert scale was used. The critical analysis of the part with the help of SPSS software is given below.

 

Likings of Otobi Furniture

                                                                                 

                                                           Liking of Otobi Furiture

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 6 10.0 10.0 10.0
Neutral 10 16.7 16.7 26.7
Agree 30 50.0 50.0 76.7
Strongly Agree 14 23.3 23.3 100.0
Total 60 100.0 100.0

 

 

In case of likings of Otobi Furniture we find that 23.3% respondents say that they strongly like Otobi Furniture, 50% say that they like otobi Furniture, 16.7% is neutral about the matter and 10% dislike Otobi Furniture. This means, about 73.3% of our total respondents like Otobi Furniture. As a result Otobi has a place in the mind of the people.

Quality of Otobi Furniture

                                                                                 

Otobi Furniture ensures more quality than its competitors

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 6 10.0 10.0 10.0
Neutral 17 28.3 28.3 38.3
Agree 25 41.7 41.7 80.0
Strongly Agree 12 20.0 20.0 100.0
Total 60 100.0 100.0

 

 

In case of quality 20% of our respondents strongly agree that Otobi ensures more quality than its competitors, 41.7% agree with the subject matter, 28.3% are neutral and 10% percent are disagree with the matter. That means about 61.7% of the respondents at least agree that Otobi Furniture ensures more quality than its competitors.

 

Brand Image of Otobi Furniture

                           Otobi Furniture has the biggest brand image in Bangladesh 

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 2 3.3 3.3 3.3
Neutral 12 20.0 20.0 23.3
Agree 30 50.0 50.0 73.3
Strongly Agree 16 26.7 26.7 100.0
Total 60 100.0 100.0

 

Brand Image is the reflection of the people’s thinking of a particular brand. In case of Otobi we find that 26.7% of the total respondents say that Otobi has the biggest Brand Image in Bangladesh, 50% are agree and remaining 20% are neutral about the matter. That means, about 76.7% people at least agree that Otobi has the biggest brand image in Bangladesh

 

 

Price of Otobi Furniture

 

 Do you think the price of Otobi Furniture is comfortable?

Frequency Percent Valid Percent Cumulative Percent
Valid Strongly Disagree 8 13.3 13.3 13.3
Disagree 13 21.7 21.7 35.0
Neutral 25 41.7 41.7 76.7
Agree 12 20.0 20.0 96.7
Strongly Agree 2 3.3 3.3 100.0
Total 60 100.0 100.0

 

Price is the main factor to purchase any kind of product. According to the officials of Otobi the price of Otobi Furniture is a bit higher. And after our survey I find the same thing. I find that 41.7% of the respondents are neutral about matter, 20% are agreeing and 3.3% are strongly agreed about the matter. On the other hand 21.7% are disagreeing and 13.3% are strongly disagreeing about the matter. It means that 35% are at least disagreeing about the matter. That means the price of Otobi Furniture is not that much comfortable.

 

Durability of Otobi Furniture

                                                                                    

Otobi Furniture is more durable than other brands

Frequency Percent Valid Percent Cumulative Percent
Valid Strongly Disagree 1 1.7 1.7 1.7
Disagree 11 18.3 18.3 20.0
Neutral 12 20.0 20.0 40.0
Agree 28 46.7 46.7 86.7
Strongly Agree 8 13.3 13.3 100.0
Total 60 100.0 100.0

 

Durability is a very important factor for a product like furniture as people will not buy furniture everyday. In case of durability of Otobi Furniture we find that 13.3% of the total respondents strongly agree that Otobi furniture is more durable than the competitors and 46.7% agree about the matter. On the other hand 1.7% respondents are strongly disagree that Otobi furniture is not more durable than the other brands, 18.3% are disagree and 20% are neutral about the matter. So we find that about 60% respondents are at least happy with the durability of Otobi Furniture.

Conformance Quality of Otobi Furniture

                        

 otobi Furniture’s Conformance quality is high

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 9 15.0 15.0 15.0
Neutral 14 23.3 23.3 38.3
Agree 30 50.0 50.0 88.3
Strongly Agree 7 11.7 11.7 100.0
Total 60 100.0 100.0

 

Conformance quality means the promise that made by the seller of a product and how much of that people get after the purchase. In case of conformance quality of Otobi Furniture I find that 11.7% of the total respondents strongly agree that Otobi furniture’s conformance quality is high and 50% agree about the matter. On the other hand 15% respondents are disagreeing that Otobi furniture’s conformance quality is high and 23.3% are neutral about the matter. So we find that about 61.7% respondents are at least happy with the conformance of Otobi Furniture.

Behavior’s of Otobi’s Employees & Sales Executives

                                                                                 

Employees & Sales Executive are friendly and cooperative in Otobi furniture’s showrooms

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 5 8.3 8.3 8.3
Neutral 18 30.0 30.0 38.3
Agree 26 43.3 43.3 81.7
Strongly Agree 11 18.3 18.3 100.0
Total 60 100.0 100.0

 

In case of behavior of the Employees and Sales Executives of Otobi Furniture 18.3% respondents are strongly agree that their behavior is friendly and 43.3% are agree about that. On the other hand only 8.3% respondents are disagreeing about the matter, 30% are neutral and no one strongly disagree. That means about 61.6% of the total respondents are at least happy with the behavior of the employees and sales executives of Otobi Furniture.

Distribution Center of Otobi Furniture

                                                                                 

 Otobi Furniture has enough distribution centers in Dhaka city

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 12 20.0 20.0 20.0
Neutral 13 21.7 21.7 41.7
Agree 24 40.0 40.0 81.7
Strongly Agree 11 18.3 18.3 100.0
Total 60 100.0 100.0

 

In case of distribution center of Otobi Furniture 18.3% respondents are strongly agree that their Otobi has enough distribution center in Dhaka city and 40% are agree about that. On the other hand only 20% respondents are disagreeing about the matter, 21.7% are neutral and no one strongly disagree. That means about 58.3% of the total respondents are at least agree that Otobi Furniture has enough distribution center in Dhaka city.

Style and Design of Otobi Furniture


 Otobi’s Furniture’s are fashionable, stylist and non-traditional

 

Frequency Percent Valid Percent Cumulative Percent
Valid Strongly Disagree 1 1.7 1.7 1.7
Disagree 5 8.3 8.3 10.0
Neutral 16 26.7 26.7 36.7
Agree 33 55.0 55.0 91.7
Strongly Agree 5 8.3 8.3 100.0
Total 60 100.0 100.0

 

In case of style and design 8.3% respondents are strongly agree that Otobi Furniture’s fashionable, stylist and non-traditional and 55% are agree about that. On the other hand only 8.3% respondents are disagreeing about the matter, 26.7% are neutral and 1.7 is strongly disagreeing. That means about 63.3% of the total respondents are at least agree that Otobi’s Furniture are fashionable, stylist and non-traditional.

Correlation Analysis is a group of techniques to measure the association between two variables. And the coefficient of correlation describes the strength of the relationship between two variables. It can assume any value from -1.00 to 1.00 inclusive. A correlation of -1.00 or 1.00 indicates the perfect relationship. The value of Coefficient of correlation less than -0.5 and above 0.5 shows strongly negatively correlation and strongly positively correlation respectively. The value between -0.5 to 0.5 may not be consider.

****** Method 2 (covariance matrix) will be used for this analysis ******

R E L I A B I L I T Y   A N A L Y S I S   –   S C A L E   (A L P H A)

 

Correlation Matrix

 

LIKINGS     QUALITY     B_IMAGE     PRICE       DURABLE

 

LIKINGS         1.0000

QUALITY          .7654      1.0000

B_IMAGE          .2866       .2905      1.0000

PRICE            .1763       .3235       .2193      1.0000

DURABLE          .6195       .6540       .2845       .2952      1.0000

C_QLTY           .7454       .6407       .1633       .1649       .6402

FRIENLI          .0766       .2203       .2055       .1977       .2274

DISTRIBU        -.1598      -.0800      -.1752       .0030       .1461

STYLIST          .0055       .0479       .3120       .0050      -.0529

 

C_QLTY      FRIENLI     DISTRIBU    STYLIST

 

C_QLTY          1.0000

FRIENLI          .1863      1.0000

DISTRIBU         .1405       .3419      1.0000

STYLIST         -.0226       .2466      -.1646      1.0000

 

N of Cases =        60.0

 

Inter-item

Correlations         Mean    Minimum    Maximum      Range    Max/Min   Variance

.2216     -.1752      .7654      .9406    -4.3677      .0623

 

Reliability Coefficients     9 items

 

Alpha =   .7188           Standardized item alpha =   .7192

 

In this correlation matrix we find that maximum value of the coefficient of correlation is 0.7654 between likings and quality of the Otobi Furniture. That means the people who like Otobi Furniture, like because of the quality of the furniture. On the other hand the minimum value is -0.1752 between the distribution and the brand image of Otobi Furniture. That means the brand image and distribution is negatively correlated. In this case the people who prefer the brand image will not prefer the distribution center. This is true as for the exclusive products people do not bother about the distribution.

 

From our analysis I also find that there are strongly positively correlation between durability and conformance quality with the likings, durability and conformance quality with quality and conformance quality with durability. That means people who like Otobi Furniture like because of durability and conformance quality and the quality mean durability and conformance quality.

 

Crosstabs analysis shows the relationship between two variables. In this case, price and the quality. The 12 respondents who strongly agree that Otobi Furniture ensure more quality 1 strongly disagree that price is comfortable, 1 is disagree, 3 are neutral about the matter, 5 are agreed and 2 strongly agreed. After that 25 respondents who agree that Otobi Furniture ensure more quality 2 strongly disagree that price is not comfortable, 6 disagreed, 13 are neutral and only 4 agreed about the matter. Then the 17 respondents who neutral about the quality 4 strongly disagree that price is comfortable, 3 disagreed, 8 are neutral and only 2 agreed about the matter. At last the 6 respondents who disagree about the quality 1 strongly disagree that price is  comfortable, 3 disagreed, 1 is neutral and only 1 agreed about the matter.


Otobi Furniture ensures more quality than its competitors * Do you think the price of Otobi Furniture is comfortable? Crosstabulation

 

Count

Do you think the price of Otobi Furniture is comfortable? Total
Strongly Disagree Disagree Neutral Agree Strongly Agree
Otobi Furniture ensures more quality than its competitors
Disagree 1 3 1 1 0 6
Neutral 4 3 8 2 0 17
Agree 2 6 13 4 0 25
Strongly Agree 1 1 3 5 2 12
Total 8 13 25 12 2 60

 

 

The whole analysis shows that Otobi Furniture has the biggest brand image in Bangladesh, ensures more quality than the competitors, more durable, conformance quality is high, fashionable, stylist, non-traditional and as a result people like Otobi Furniture but the price is not too much comfortable and the number of distribution center is not sufficient as per the correlation analysis.

 

 

Test of hypothesis: (Two tail T Test)                                                 

                                                                                           

1)    Price validity in terms of Quality of Otobi Furniture:

 

Here Null hypothesis is= Price of Otobi in terms of quality is comfortable

Alternative hypothesis= Price of Otobi in terms of quality is not comfortable

 

Levene’s Test for Equality

of Variancest-test for Equality of Means  FSig.tdfSig. (2-tailed)Mean DifferenceStd. Error Difference95% Confidence Interval of the Difference         LowerUpperDo you think the price of Otobi Furniture is comfortable?Equal variances assumed.310.582-1.08029.289-.43.395-1.235.381 Equal variances not assumed  -.9416.640.379-.43.453-1.510.657

Independent Samples Test

 

Interpret: Here Critical value is ± 2.045 and t value is -1.080 which lies under the critical value. So null hypothesis is accepted. That means the price of Otobi furniture in terms of quality is comfortable among those respondents.

 

2)    Price validity in terms of Gender:

 

Here Null hypothesis is= Price of Otobi in terms of gender is comfortable

Alternative hypothesis= Price of Otobi in terms of gender is not comfortable

 

Independent Samples Test

 

Levene’s Test for Equality of Variances t-test for Equality of Means
F Sig. t Df Sig. (2-tailed) Mean Difference Std. Error Difference 95% Confidence Interval of the Difference
Lower Upper
Gender Equal variances assumed 1.189 .287 -.551 23 .587 -.10 .186 -.488 .283
Equal variances not assumed -.548 22.130 .589 -.10 .187 -.490 .285

 

Interpret: Here Critical value is ± 2.069 and t value is -.551 which lies under the critical value. So null hypothesis is accepted. That means the price of Otobi furniture in terms of gender is comfortable among those respondents.

3)    Price validity in terms of occupational level:

 

Here Null hypothesis is= Price of Otobi in terms of occupational level is comfortable

Alternative hypothesis= Price of Otobi in terms of occupational level is not comfortable

 

Independent Samples Test

 

Levene’s Test for Equality of Variances t-test for Equality of Means
F Sig. t df Sig. (2-tailed) Mean Difference Std. Error Difference 95% Confidence Interval

of the Difference         LowerUpperOccupation typeEqual variances assumed2.682.115-.17523.863-.11.623-1.398.180 Equal variances not assumed  -.17622.643.861-.11.618-1.3881.170

 

Interpret: Here Critical value is ± 2.069 and t value is -.175 which lies under the critical value. So null hypothesis is accepted. That means the price of Otobi furniture in terms of occupational level is comfortable among those respondents.

 

4)    Price validity in terms of household income:

 

Here Null hypothesis is= Price of Otobi in terms of household income is comfortable

Alternative hypothesis= Price of Otobi in terms of household income is not comfortable

 

Independent Samples Test

 

Levene’s Test for Equality of Variances t-test for Equality of Means
F Sig. t df Sig. (2-tailed) Mean Difference Std. Error Difference 95% Confidence Interval

of the Difference         LowerUpperHousehold incomeEqual variances assumed.637.433-.35323.727-.11.309-.748.530 Equal variances not assumed  -.35622.429.725-.11.306-.742.524

 

Interpret: Here Critical value is ± 2.069 and t value is -.353 which lies under the critical value. So null hypothesis is accepted. That means the price of Otobi furniture in terms of household income is comfortable among those respondents.

 

5)    Price validity in terms of prefer favorite brand of cloths:

 

Here Null hypothesis is= Price of Otobi in terms of brand prefers is comfortable

Alternative hypothesis= Price of Otobi in terms of brand prefer is not comfortable

 

Independent Samples Test

 

Levene’s Test for Equality of Variances t-test for Equality of Means
F Sig. t df Sig. (2-tailed) Mean Difference Std. Error Difference 95% Confidence Interval of the Difference
Lower Upper
Favorite brand of cloths Equal variances assumed .161 .692 -.314 23 .756 -.19 .612 -1.458 1.074
Equal variances not assumed -.315 22.926 .756 -.19 .611 -1.457 1.073

 

 

Interpret: Here Critical value is    ± 2.069 and t value is -.314 which lies under the critical value. So null hypothesis is accepted. That means the price of Otobi furniture in terms of brand prefers is accepted among those respondents.

 

6)    Furniture are fashionable, stylist with prefer of brand of cloths :

Here Null hypothesis is= Otobi’s Design is prefer by the brand loyal people

Alternative hypothesis= Otobi’s Design is not prefer by the brand loyal people

Independent Samples Test

 

Levene’s Test for

Equality of Variancest-test for Equality

of Means  FSig.tdfSig. (2-tailed)Mean DifferenceStd. Error Difference95% Confidence Interval

of the Difference         LowerUpperFavorite brand of clothsEqual variances assumed6.301.0172.20036.0341.66.755.1303.192 Equal variances not assumed  3.3808.815.0081.66.491.5462.775

 

Interpret: Here Critical value is ± 2.31 and t value is 2.2 which lie under the critical value. So null hypothesis is accepted. That means, Otobi furniture prefers by the brand loyal people.

The behavioral component of an attitude is one’s tendency to respond in a certain manner toward an object or activity. It means a series of decisions to purchase or not purchase the furniture of Otobi. To measuring the behavioral component of the people at the end of our survey we asked our respondents “Will you buy furniture from Otobi the very next time you buy any furniture?”

The results of the questions from the survey are shown in the graph below,Though most of the respondents at least agree that Otobi Furniture ensures quality than its competitors, have biggest brand image, more durable, high conformance quality, fashionable, stylist and non-traditional but according to the buying behavior for the very next time I find that 20% respondents obviously buy from Otobi, 35% may buy and 35% are not sure. On the other hand 2.5% may not buy and 7.5% obviously not buy from there. As a result we can say that majority of the respondents are not sure weather they buy from Otobi Furniture or not. The reasons may be price, availability of the products and substitute products. As a result, Otobi Furniture is facing a tough competition. So for keeping their market share or increasing the market share the need to readjust their price, make available their products.

Otobi Furniture can change their target market’s affective, cognitive and behavioral component.

Otobi Furniture can change the consumer’s beliefs towards their products by changing beliefs, shift importance and add beliefs.

Chapter 8

Change Beliefs

This strategy involves shifting beliefs about the brand. People have a belief that Otobi Furniture is expensive. As a result they sometimes purchase products from other brands. So they can show people that why their price is high or they can shift the belief that Otobi Furniture is more exclusive than other brands.

Add Beliefs

Another approach to changing the cognitive component of an attitude is to add new beliefs to the consumer’s belief structure. For that the price of furniture is high as for good quality raw materials and high technological machineries.

Shifting Importance

Most consumers consider some product attributes to be more important than others. Most of the people consider price is the main indicators to purchase of furniture. The sometime did not consider quality or durability more. As a result, Otobi may try to shift their beliefs from price to quality and durability as the main indicators.

Classical Conditioning

Otobi Furniture can use classical conditioning to change the affective components of the target market. It could create an exceptional type of music for its television ads to keep itself always in the mind of the people. Not only that they can show the picture of big corporate houses with their furniture and well furnished home in the ads by which people can easily associate Otobi with these things.

Affect toward the Ad or Website

Likings the advertisement generally increases the tendency to like the product. Somewhat similar results are associated with liking the website on which an ad appears. But website of Otobi is closed for a long time. So they need to open and develop a sophisticated website as early as possible.

Mere Exposure

Otobi Furniture is a high involvement product but it needs mere exposure to create positive feelings in the mind of customers. Now a day number of advertisement in the television of Otobi Furniture is very lower. As a result, for keeping their name in the mind of the people Otobi needs to show their ads more in the television and in newspaper.

Behavior, specifically purchase or use behavior may precede the development of cognition and effect. Or it may occur in contrast to the cognitive and affective components.  Otobi is trying to change the behavioral components of the people by using operant conditioning. They are giving 10% discount on all furniture in the Rainy season. By this they are also showing that the price of Otobi is decreased.

  • Using Celebrities: Otobi did not use any celebrities in the advertisement. They can use celebrities to promote their products.
  • Using Humor Appeal: Otobi can use humor in the advertisement as people do not remind the brand but remind the dramatic presentation on the ads. As a result, Otobi can use humor to promote their products in the television.

Positive emotions should be aroused in Ads. The slogan of Otobi “World Class Furniture” has not been very successful in eliciting positive emotion in the consumer’s mind as from our survey I find that the recall rate is not too good only 42.5%. As a result, they should give more advertisement in the newspaper or in the television.

We previously stated that, our survey showed that the target market see themselves as very discipline and very colorful. They are also dominating, organized and formal.

Is Otobi Projecting Their Self-Concept

Otobi is more or less projecting the self-concept of the target market. The image of Otobi Furniture is matched with the target market’s self concept. Otobi always try to position itself as a prestigious and high status product. And that is going with the self-concept of the people. Otobi furniture usually placed in the corporate houses where people need to be formal, discipline and organized. That is why Otobi more or less projecting the self-concept of the target market.

As Otobi Furniture can be used by anyone all people’s lifestyle need to match with Otobi. In our country the people who are the major target of Otobi Furniture according to the VALS system can be classified as “Status Oriented” who want to achieve more in the life. If go deeper than that, we can classified them into the Actualizer. Actualizers are the people who are successful, sophisticated and active and who have much resource, who prefer image than anything else.

Otobi Furniture mainly targeted the corporate houses and home. The target market’s life-style is more organized, formal and discipline. As a result Otobi fits into their lifestyle. From our survey we find that Otobi Furniture is very formal and prestigious and also reflect a person’s image to the others. That means Otobi fits with their organized and formal lifestyle.

On the other hand, Otobi also fit with the lifestyle of the people who using it in their homes. I also make the survey with the housewives and get the same results as before.  Considering all this we can say that Otobi fits with the lifestyle of the target market.

Otobi started its journey in the year 1975. That time it was the only furniture company in the market. And for a long time they were alone. After that So many new firms come into the market. And as a result, competition in the furniture industry is increasing day by day. And now the market share of Otobi has divided in to so many parts though yet they are the market leader of the industry. But in some extent though their quality, durability and conformance quality is high price is not that much comfortable to the people. Perhaps other firms take this as an opportunity for them. May be by compromising with the quality they reduce their price. And for that reason though Otobi has monthly sales of 15 crore taka but market share is decreasing slowly.

The basic motive to buy furniture varies man to man. Some people buy for its basic need, some for creating image, some for fashion and some for aristocracy. The most of the firms are giving the same products but why people prefer different brands. When I asked this to our respondents I find different answers. Some prefer the quality, some prefer the brand loyalty, some prefer the durability, some prefer the price, and some prefer the conformance quality.

Otobi Furniture motivates their customers by giving more and more preference to the quality and durability of the furniture. But for that reasons price increased a bit. Form my survey I also get the same result and this is also known by the officials of Otobi. When I asked them about the matter, they told us that if they are able to provide the best quality furniture, why people will not pay more to them. And they have already the biggest brand image in Bangladesh and they are the first furniture firm which export furniture outside the boundary of our country. For that reason they have a very big brand image. And big brand image creates more loyal customers. As a result though number of new firms is increasing, Otobi yet in the same position as before.

The main drawback of Otobi Furniture is the price. From our survey it is clearly found that people are not really comfortable with the price. Rather than price it has also draw backs in the promotional and distribution activities.

Otobi is the market leader in furniture industry. But unfortunately I find a very few advertisement in the newspaper and television of Otobi Furniture. My survey also shows the same results. When I asked our respondents about watching promotional exposure in television or newspaper last week, their answers reflect the same. Only 42% respondents answered “Yes”. On the other hand 25% answered “No” and 33% are not sure about the matter.

As a result, we can conclude that Otobi has some problems with their promotional activities. On the other hand, I find frequent advertisement of Navana and other brands. We know that exposure creates attention. So Otobi may loose some of the people’s attention if this strategy not changed by Otobi Furniture. Some of our respondents also give extra suggestions to increase the advertisement.

Banner

  • The banner that we see now a day in the roads mainly for the Rainy season with the 10% discount offer. After the Rainy season they will be useless. But before the Rainy season I did not see any single banner in the roads any where in Dhaka city.

Newspaper and TV Advertisement

  • Before the Rainy season the paper and Television advertisement was stopped for a long period of time. And have no variety. Not only that these ads did not reflect the actual brand image of Otobi Furniture.

Some of our respondents also give extra suggestions to increase the distribution of Otobi Furniture. Problems that are lying with the distributions are,

  • We know that Otobi has the biggest brand image but there are only seven outlets are situated in Dhaka city and only one in Chittagong.
  • Khulna is the third big city of Bangladesh but in 31 years Otobi Furniture did not open any outlet there.

Price

Otobi Furniture should decrease their price a bit to make their price more competitive in the market.  For that they need to decrease their cost. We know that they imported most of their raw materials from outside the country. So they can make long term contract with the exporter or may take backward linkage strategies.

Other suggested strategies are,

Distribution Activity

The number of distribution outlets should be increased in Dhaka and Chittagong city. They also need to increase their outlets into other big cities like Khulna.

Newspaper Advertisement

v  Number of newspaper advertisement should be increased. Not only that Otobi can also use variety of advertisements.

v  The advertisement of newspaper should also contain more relevant information about the products.

v  Otobi should also provide more colorful paper ad to attract the attention.

Television Advertisement

v  Number of television advertisement should be increased. Not only that Otobi can also use variety of advertisements.

v  In some case they can use humor in the ads as people may not remind the brand name but remind the dramatization of the advertisement.

v  They should also show the prestigious and status issue more in the advertisement.

v  These ads should be shown more at night as people watch more television at night.

v  The ads should also try to change the beliefs of people about price by giving more emphasis on quality and other attributes.

Billboards

v  Otobi Furniture can use billboards as their promotional activities. They should provide as many information and picture of different products in the billboards.

v  The billboard also should be more colorful to attract more attention.

v  The billboard should be placed in a person’s visual field.

Banner

v  Otobi can also use colorful banner in all the prime places of Dhaka city. In this case after finishing the Rainy season they should change their entire present banner and use more colorful banner.

 Direct Selling

v  For a product like furniture Direct Selling is a very important promotional strategy. From our survey I find no one say about direct selling as their last exposure of Otobi furniture though about 50% of our respondents are businessperson or service holders. As a result direct selling should be increased.

Sponsor

v  Otobi did not sponsor any kind of event in past. But they can use it as a promotional tool by sponsoring furniture fair.

 

Positioning

From our survey, I got the following perceptual map for the furniture of Otobi and other brands.

Expensive & Expensive

 

 

Traditional

Otobi should be positioned downward as a less expensive product.

  • Ø Md. Asaduzzaman

Officer, Sales

Otobi Limited

923 Rokeya Sharone Shewrapara

Dhaka 1216 Bangladesh

  • Dr. Monowar Hossain Mahmood

          Associate Professor

Faculty of Business

East West University

 

  • Del I. Hawkins, Roger J. Best, Kenneth A. Coney,  (2004) “Consumer Behavior”

McGraw-Hill/Irwin, 1221 Avenue of the Americas, New York, NY, 10020

  

Table of Crosstabs analysis:

 

Otobi Furniture ensures more quality than its competitors * Do you think the price of Otobi Furniture is comfortable? Crosstabulation

 

Count

Do you think the price of Otobi Furniture is comfortable? Total
Strongly Disagree Disagree Neutral Agree Strongly Agree
Otobi Furniture ensures more quality than its competitors
Disagree 1 3 1 1 0 6
Neutral 4 3 8 2 0 17
Agree 2 6 13 4 0 25
Strongly Agree 1 1 3 5 2 12
Total 8 13 25 12 2 60

 

 Frequencie distribution Table:

  

Liking of Otobi Furiture

 

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 6 10.0 10.0 10.0
Neutral 10 16.7 16.7 26.7
Agree 30 50.0 50.0 76.7
Strongly Agree 14 23.3 23.3 100.0
Total 60 100.0 100.0

 

Otobi Furniture ensures more quality than its competitors

 

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 6 10.0 10.0 10.0
Neutral 17 28.3 28.3 38.3
Agree 25 41.7 41.7 80.0
Strongly Agree 12 20.0 20.0 100.0
Total 60 100.0 100.0

 

 Otobi Furniture has the biggest brand image in Bangladesh

 

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 2 3.3 3.3 3.3
Neutral 12 20.0 20.0 23.3
Agree 30 50.0 50.0 73.3
Strongly Agree 16 26.7 26.7 100.0
Total 60 100.0 100.0

 

 

 Do you think the price of Otobi Furniture is comfortable?

 

Frequency Percent Valid Percent Cumulative Percent
Valid Strongly Disagree 8 13.3 13.3 13.3
Disagree 13 21.7 21.7 35.0
Neutral 25 41.7 41.7 76.7
Agree 12 20.0 20.0 96.7
Strongly Agree 2 3.3 3.3 100.0
Total 60 100.0 100.0

  

Otobi Furniture is more durable than other brands

 

Frequency Percent Valid Percent Cumulative Percent
Valid Strongly Disagree 1 1.7 1.7 1.7
Disagree 11 18.3 18.3 20.0
Neutral 12 20.0 20.0 40.0
Agree 28 46.7 46.7 86.7
Strongly Agree 8 13.3 13.3 100.0
Total 60 100.0 100.0

 

otobi Furniture’s Conformance quality is high

 

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 9 15.0 15.0 15.0
Neutral 14 23.3 23.3 38.3
Agree 30 50.0 50.0 88.3
Strongly Agree 7 11.7 11.7 100.0
Total 60 100.0 100.0

 

Employees & Sales Executive are friendly and cooperative in Otobi furniture’s showrooms

 

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 5 8.3 8.3 8.3
Neutral 18 30.0 30.0 38.3
Agree 26 43.3 43.3 81.7
Strongly Agree 11 18.3 18.3 100.0
Total 60 100.0 100.0

Otobi’s Furniture’s are fashionable, stylist and non-traditional

 

Frequency Percent Valid Percent Cumulative Percent
Valid Strongly Disagree 1 1.7 1.7 1.7
Disagree 5 8.3 8.3 10.0
Neutral 16 26.7 26.7 36.7
Agree 33 55.0 55.0 91.7
Strongly Agree 5 8.3 8.3 100.0
Total 60 100.0 100.0

  Otobi Furniture has enough distribution centers in Dhaka city

 

Frequency Percent Valid Percent Cumulative Percent
Valid Disagree 12 20.0 20.0 20.0
Neutral 13 21.7 21.7 41.7
Agree 24 40.0 40.0 81.7
Strongly Agree 11 18.3 18.3 100.0
Total 60 100.0 100.0

 

 Table of correlation analysis

 

****** Method 2 (covariance matrix) will be used for this analysis ******

 

R E L I A B I L I T Y   A N A L Y S I S   –   S C A L E   (A L P H A)

 

Correlation Matrix

 

LIKINGS     QUALITY     B_IMAGE     PRICE       DURABLE

 

LIKINGS         1.0000

QUALITY          .7654      1.0000

B_IMAGE          .2866       .2905      1.0000

PRICE            .1763       .3235       .2193      1.0000

DURABLE          .6195       .6540       .2845       .2952      1.0000

C_QLTY           .7454       .6407       .1633       .1649       .6402

FRIENLI          .0766       .2203       .2055       .1977       .2274

DISTRIBU        -.1598      -.0800      -.1752       .0030       .1461

STYLIST          .0055       .0479       .3120       .0050      -.0529

 

 

C_QLTY      FRIENLI     DISTRIBU    STYLIST

 

C_QLTY          1.0000

FRIENLI          .1863      1.0000

DISTRIBU         .1405       .3419      1.0000

STYLIST         -.0226       .2466      -.1646      1.0000

 

N of Cases =        60.0

 

Inter-item

Correlations         Mean    Minimum    Maximum      Range    Max/Min   Variance

.2216     -.1752      .7654      .9406    -4.3677      .0623

 

Reliability Coefficients     9 items

 

Alpha =   .7188           Standardized item alpha =   .7192

 

 

Quality of otobi Furniture ( Pie chart)

 

Brand image of Otobi Furnitire (Pie chart)

PROFILE OF THE TARGET CUSTOMER AND THEIR ATTITUDE TOWARDS OTOBI FURNITURE

Otobi Furniture is one of the market leaders of lamination board furniture industry of Bangladesh. They are the pioneer in the luxury furniture industry with remarkable customer care and profound standard of value offering to the consumers. And therefore, this is an attempt to survey the “Profile of the target customer and their attitude towards Otobi furniture” that their current and potential prospects perceived. This study is being conducted by me of East West University student as the part of my project in “project work” course. Your participation in the study will help me to enrich my practical educational implementation on this particular brand. Your response will be kept in strict confidence since no attempt will be made to disclose your opinion. The survey will take only in 5-10 minute. Your participation is absolutely voluntary and you may withdraw your opinion any time.

THANK YOU

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