Customer Behaviour Influence on Grocery Store Purchasing Decisions

Dissertation
(Customer behaviour influence on grocery store purchasing decisions)

TABLE OF CONTENTS
CHAPTER 1 INTRODUCTION.....................................................................................................4
1.1 Background of the study...................................................................................................4
1.2 Research aims and objectives...........................................................................................5
Research Questions................................................................................................................6
1.3 Rationale of study.............................................................................................................6
Problem statement..................................................................................................................7
1.4 Significance of Study.......................................................................................................7
1.5 Dissertation Structure.......................................................................................................8
CHAPTER 2: LITERATURE REVIEW.......................................................................................10
Theme 1: customers loyalty towards grocery stores and ways to maintain customers’ loyalty
..............................................................................................................................................10
Theme 2: Assessment of demographic profiles of both grocery and convenient store
customers and its impact on market share of the organisation.............................................15
Theme 3: Customer's purchase decisions in accordance with customer's switching from
purchasing products in traditional retail to purchasing in convenient stores.......................19
CHAPTER 3: RESEARCH METHODOLOGY...........................................................................26
Research philosophy.............................................................................................................26
Research approach................................................................................................................26
Research design....................................................................................................................27
Data collection......................................................................................................................28
Sampling...............................................................................................................................31
Data analysis.........................................................................................................................32
Ethical consideration............................................................................................................33

Reliability and validity.........................................................................................................34
Research limitation...............................................................................................................34
CHAPTER 4: RESULTS AND DISCUSSION.............................................................................36
4.1 Frequency Table...........................................................................................................36
4.2 Correlations...................................................................................................................46
4.3 Regression.....................................................................................................................49
4.4 T-Test.............................................................................................................................51
4.5 Independent Samples Test...........................................................................................52
4.6 Discussion of findings....................................................................................................54
CHAPTER:5 CONCLUSION AND RECOMMENDATIONS....................................................57
5.1 Conclusion......................................................................................................................57
5.2 Recommendations..........................................................................................................59
REFERENCES..............................................................................................................................62
APPENDIX 1.................................................................................................................................68
QUESTIONNAIRE..............................................................................................................68
Descriptive Analysis......................................................................................................................73

CHAPTER 1 INTRODUCTION
1.1 Background of the study
The consumer behaviour analysed study of ways through which consumers make
decisions to buy products and services in the market. For grocery retail store, behaviour of
customers plays a crucial role in making decisions regarding purchase of products and services
from suppliers. Companies usually provide them emphasize on analysing requirements of
customers and making changes in their perception so that they will buy their products and
services (Glanz, Bader and Iyer, 2012). Usually there are various important decisions that need
to undertake by grocery stores for sustaining their business operations in this competitive
environment. The retail world will change more in the next twenty years than in all the history of
modern day retailing. This is driven by the seismic shift in consumer’s buying behaviour and
habits. Paul and Rana, (2012) stated that there are various factors that drive consumers to
different kinds of stores and influence their buying decision. This helps industry to respond in
favour of consumer behaviour so that grocery stores can effectively achieve profits in a better
way. This is essentially required because purchasing decisions of consumers are influenced by
variety of factors and thus, marketplace is determined with their preferences up to a high extent.
In last several years, supermarket chains in economy have acquired an increased share of
grocery markets and in doing so, they have increased their influence on suppliers(Paul and Rana,
2012. Traditional retail stores in market have faced various challenges due to continuous
changing preference of customers (Cohen and Babey, 2012). Emergence of new technologies
and facilities has attracted people towards online shopping. This major advancement has also
provided ample of opportunities for customers to make choices between products of different
brands in the market. However, sales and market share of traditional grocery store in UK is
highly influenced by this technological advancement because they have not adopted these
facilities to provide products and services. Continuous development in terms of technology and
R&D is required by which UK traditional grocery stores can attain sales and increased profits
with ease.
In addition, continuous raising competition has also influenced customer behaviour because they
prefer to shop from such place which offers them high quality products at affordable rates.. High
income and demographic factors of customers has also influenced the market share of grocery
stores and resulted in decline in sales.

The original retail model had been upgraded to be more modern and comfortable for
consumers by adopting new ideas of international investments in modern trade for traditional
grocery retail (Paul and Rana, 2012). With this major, traditional grocery stores have been
transformed in large retail supermarket chain. This is considered as a major transformation in the
retail sector.
This study is carried out by scholar to analyse and assist the grocery retail sector by
determining the reasons for declining in their market share. Analysis of grocery store have been
undertaken to determine the influence of customers’ behaviour on purchase decision of
organisation. For this dissertation, TESCO retail store have been selected, which is a traditional
retail organisation that is independently owned and operates in supermarket. It's each store
provides itself on fresh quality food, competitive pricing, huge products selections and a broad
range of ethnic food products geared towards its local community. Since the first TESCO opened
in the 1970, it has grown to over 500 incredible stores across countries. This dissertation will
also highlight reasons behind decline in profitability and market share of grocery retail store.
Over a period of time Tesco has faced huge loss, its sales are decreasing and it is unable to
satisfy needs of consumers. This is the major issue in the organisation; firm is operating its
business by using traditional methods that are unable to gain attention of buyers. Researcher
aims to find out root cause of this problem and want to find out proper solution through which
Tesco can gain more profit and can attract buyers towards its stores.
1.2 Research aims and objectives
Aim
The aim of this present study is to assist traditional retail store by determining reasons for
declining in market share- A study on TESCO.
Objectives
Following objectives have been drafted by researcher on the basis of above aim of the study.
 To assess the demographic profiles of both grocery and convenient store customers.
 To identify how the customers are loyal to grocery stores and ways to maintain
customer's loyalty.
 To define customer's buying decision in relation to them switching from buying products
in traditional retail to purchase from convenient stores.

Hypothesis
 There are no significant mean differences between Consumer buying behaviour and store
convenience.
 There are no significant mean differences in the convenience and buying motives of
buyers.
 There is no significant relationship between expansion of traditional stores and
enhancement of brand recognition.
1.3 Research Questions
In order to carry out research in structured and appropriate manner, scholar is required to create
suitable questions on the basis of project aim and objectives of the study.
 What is the demographic profile for both grocery and convenient store?
 How the customers are loyal to grocery stores and how to maintain customer's loyalty.
 What is customer's purchase decision in relation to them from buying products in
traditional retail to purchasing from convenient stores?
1.4 Rationale of study
The main reason of undertaking this research is that the researcher has an interest in this
area of topic and there is a wide scope of study. This study has been conducted to analyse assist
traditional retail stores by determining reasons behind decrease in the market share of companies.
Various important issues have been analysed, which provides support in developing problem
solving skills and capabilities. Expansion of traditional stores in Thailand and other important
opportunities are acquired by organisation that have been analysed effectively. It is a semi
structured topic and thus, this would be more easy to carry out research on this subject.
Various researchers have conducted their research on globalisation and various
organisations are working across the world. However, there is huge secondary data available on
this topic, which can support the investigator in developing their understanding and identifying
impacts of these strategies on business units and other sectors. Study will help in developing,
comprehending, analysing, technological, analytical, conceptual and motivational skills.
Analysis of various literature helps in increasing efficiency of undertaking qualitative research.
This topic is selected as it has major relevance and wide scope of research. It also provides

support in completion of research and analysing that manager needs to maintain effective
leadership. High intention of consumers have also affected the decision of research and
methodology undertaken by researcher to carry out research in appropriate manner.
1.5 Problem statement
In this research. Main issues to analyse the customer behaviour and other factors which
have significant influence on profit margin of retail company. In this study, the major problem is
to find out ways through which firms operating in retail sector of UK can improve its
profitability and overall financial performance (Glesne, 2015). Moreover, profit is analysed as
most important factor which has high level of influence on implementation of strategic. In order
to gain competitive edge, organisation operating in retail sector needs to invest high funds or
money in R&D activity. This is only possible when firm ensures effective management and
generate high profit margin. However, the focus of researcher is to determine reasons for which
customer's behaviour in retail sector are influenced negatively. The present research and its
outcome will deliver appropriate level of support to traditional grocery store in developing
strategic and effective purchase decisions to meet customer's requirements. Scholar has utilized
quantitative data collections methods to collect its primary data.
1.6 Significance of Study
Outcomes and results of the research are highly important for TESCO which is
expanding its business operations in Thailand. It will also provide understanding about major
trends and development which have been undertaken in retail and provided influence on the
consumer's behaviour. It also helps in identification of strategies and tactics that needs to be
implemented by traditional retail store in organisation to increase their market share and
expansion of business operations, there are various important studies have been undertaken to
carry out research in appropriate manner. Study will also provide understanding about the impact
of retail segment on the traditional market share which is changing customer's behaviour. It is
also importance for other scholar who needs to carry out study on these areas. Different measures
which is used for carrying out appropriate research can also be analysed by scholar for carrying
research in appropriate manner. Performance and work initiative have been undertaken by
management to carry out research. Various important issues related to growth and decline market
share of enterprises have been reflected with the study and its major importance in organisation.
Further, report will also provide high level of assistance to other scholar willing to conduct study

on similar topic and by going through the findings of such study on similar topic or issue. By
going through the findings of such study other scholars would become able to gain understanding
about the reasons why the market share of retail stores is influenced in the market.
1.7 Dissertation Structure
Chapter 1: Introduction
In this introductory section, background, rational and significance of study have been
determined by scholar. Along with this, the referring to the research issues, aims and objectives
have also been formulated by the researcher. In this, scholar has completely mentioned the
structure which is followed in overall study. The introduction provides entire understanding of
the study undertaken and research aim, objectives are outlined in this section. Moreover, any
hurdles or issues found in conducting research are also highlighted giving proper structure of
research. All such elements have been duly included in the research.
Chapter 2: Literature review
This chapter will present the views and findings that have already been presented by other
researcher in relation to the influential factors that impact profit margin. Hence, in this, brief
thesis has been prepared by the scholar through the evaluation of books, journals and scholarly
articles. Hence, considering the objectives, several themes have been prepared by researcher with
the motive to assist retail traditional stores by determining reason behind decline market share.
Various themes are produced and views presented by academic literature studies. In recent
studies, it has been shown that businesses can grow quite easily if they relate to customers with
advanced techniques such as interacting over e-mail, analysing purchasing decisions in effective
manner.
Chapter 3: Methodology
In this chapter of dissertation, the researcher has mentioned tools and techniques
undertaken for the present study. Hence, it furnishes information about the tools that have been
undertaken by an investigator for the purpose of data collection and analysis. Target population,
sample size, research instrument and limitation have been determined appropriately. The
research methodology is quite useful for conducting research in an effective manner. It is an
original investigation to analyse several elements and understanding discipline in a better way.
This helps to attain findings from the constructed hypotheses and develop new knowledge.
Chapter 4: Results and discussion