Amara Raja Customer Satisfaction

Customer Satisfaction
CHAPTER -1
INTRODUCTION
INDUSTRY PROFILE
COMPANY PROFILE
PRODUCT PROFILE
ACHARYA INSTITUTE OF TECHNOLOGY Page 1

1.1 INTRODUCTION
CUSTOMER SATISFACTION
Customer satisfaction, a businessterm, is a measure of how products and services

supplied by a company meet or surpass customer expectation. It is seen as a key performance
indicator within business and is part of the four perspectives of a Balanced Scorecard.
In a competitive marketplace where businesses compete for customers, customer

satisfaction is seen as a key differentiator and increasingly has become a key element of
business strategy
WHAT IS CUSTOMER SATISFACTION?

Everyone knows what satisfaction is, until asked to give a definition' Then, it seems’
nobody knows. This quote from Richard L. Oliver, respected expert and longtime writer and
researcher on the topic of customer satisfaction, expresses the challenge of defining this most
basic of customer concepts. Building from previous definitions' Oliver offers his own formal
definition:
“Satisfaction is the consumer's fulfillment response. It is a judgment that a product or

service feature, or the product or service itself, provides a pleasurable level of consumption-
related fulfillment.”
In less technical terms, we translate this definition to mean that satisfactorily is the
customers' evaluation of a product or service in terms of whether that product or service has
met their needs and expectations. Failure to meet needs and expectations is assumed to result
in dissatisfaction with the product or service’
DEFINITION
Cocotte, woodruff and Jenkins (1987) define customer satisfaction as "conceptualized as a
feeling developed from an evaluation of the experience."
HERE, the timing of satisfaction response is driving consumption.
BUT there is general agreement with kotler (2003) that "customer satisfaction is a
person's feeling of pleasure or disappointment resulting from comparing a products perceived
performance in relation to his or her expectation." In short customer satisfaction is "The
provision of goods or services which fulfill the customer expectation in terms of quality and
service, in relation to price paid."

MEANING OF CUSTOMER SATISFICATION

Customer satisfaction is a business term, is a measure of how products and
services supplied by a company meet or surpass customer expectation. It is seen as a key
performance indicator within business and part of the four prospective of balanced score card.
In a competitive market place were businesses compete for customers, customer
satisfaction is seen as a key differentiator and increasingly has become a key element of
business strategy customer satisfaction drives successful private sector business.
High performing businesses have developed principles and strategies for achieving
customer satisfaction. This paper presents a framework or set of ideas for using
customersatisfaction principles and strategies to improve the quality responsiveness, and
possibility of public sector privately provided services in vulnerable communities
The framework suggested that resident who live in tough neighborhoods can be supported
through customer satisfaction strategies to become empowered individuals who informed
perspectives influence decisions about what, how, when, and where services are available to
them.
Customer satisfaction is the customer’s response to the evaluation of the perceived
discrepancy between prior expectation and the actual performance of the product as perceived
after itsconsumption.
IMPORTANCE OF CUSTOMER SATISFACTION
It costs at least 7 times more to source a new customer than it does to retain existing
onea 'satisfied' customer tells 5-7 people in a year whilst a 'dissatisfied' customer will tell 14-
15 people.
 Companies can boost profits anywhere from 25% to 125% by retaining a mere 5%
more of their exciting customers.
 Totally satisfied customers were 6 times more likely to use that services and
commend it than ' satisfied' customers.
 Customers who have a bad experience with you and do not complain are only 37%
likely to still do business with you.
 Customers who have an opportunity to complain and the complaint is achieved are
95% likely to still do business with you.
 MEASURING CUSTOMER SATISFACTION

 Organizations are increasingly interested in retaining existing customers while

targeting non-customers, measuring customer satisfaction provides an indication of
how successful the organization is at providing products and/or services to the
marketplace.
 Customer satisfaction is an ambiguous and abstract concept and the actual
manifestation of the state of satisfaction will vary from person to person and
product/service to product/service. The state of satisfaction depends on a number of
both psychological and physical variables which correlate with satisfaction behaviors
such as return and recommend rate. The level of satisfaction can also vary depending
on other options the customer may have and other products against which the
customer can compare the organization's products.
 Because satisfaction is basically a psychological state, care should be taken in
the effort of quantitative measurement, although a large quantity of research in this
area has recently been developed. Work done by Berry, Brodeur between 1990 and
1998 defined ten 'Quality Values' which influence satisfaction behavior, further
expanded by Berry in 2002 and known as the ten domains of satisfaction. These ten
domains of satisfaction include: Quality, Value, Timeliness, Efficiency, Ease of
Access, Environment, Inter-departmental Teamwork, Front line Service Behaviors,
Commitment to the Customer and Innovation. These factors are emphasized for
continuous improvement and organizational change measurement and are most often
utilized to develop the architecture for satisfaction.
FACTORS OF CUSTOMER SATISFACTION
1. Service of quality
2. reliability of service
3. knowledge of the staff
4. Being kept informed of progress
5. The way service kept its promises
6. The way the service handled any problem Friendliness of staff
7. How sympathetic staff were to your needs
8. Speed of enquiries
9. Number of time had to contact the service.

Customer satisfaction, a business term, is a measure of how products and services supplied by
a company meet customer expectation. It is seen as a key performance indicator within
business and is part of the four perspectives of a Balanced Scorecard.
In a competitive marketplace where businesses compete for customers, customer satisfaction

is seen as a key differentiator and increasingly has become a key element of business
strategy.
There is a substantial body of empirical literature that establishes the benefits of customer
satisfaction for firms.
"Customer satisfaction"is the important statement of the problem in this project.
Measuring customer satisfaction
Customer satisfaction refers to the extent to which customers are happy with the products and
services provided by a business. Customer satisfaction levels can be measured using survey
techniques and questionnaires. Gaining high levelsof customer satisfaction is very important
to a business because satisfied customers are most likely to be loyal and to make repeat orders
and to use a wide range of services offered by a business.

1.2 INDUSTRY PROFILE

The Battery Industry in India, which is worth Rs. 1,600 cr, has a market size of 2000
million units. The industry is dominated by dry carbon cell batteries and the demand to a
large extent is from the rural areas. The Industry Focus highlights the classification of the
battery market and the product portfolios of the domestic players in India
DESCRIPTION
The demand for batteries, which has been fuelled by increase in the usage of small pocket
radios and high-powered cameras, has improved dramatically. The shift, in the nature of demand
(from D size batteries to pencil size batteries) has also brought in a drastic change in the demand
pattern.
Eveready Industries leads the Indian dry carbon cell market with over 40% market share.
Though Eveready is a strong national player, Nippo has a prominent presence in the southern region.
Novino, on the other hand, has a strong presence in certain pockets in the northern region, while
BPL, a new entrant, has also managed to garner sizeable market share.
The alkaline battery market only accounts for 5% of the total market. This is because the
alkaline battery costs twice as much as a traditional zinc carbon battery. The higher pricing is due to
the relatively higher cost of production. Contrary to the global trend, the higher price of alkaline
battery has dampened the market's growth in India. Alkaline batteries in developed countries account
for more than 70% of the battery market. The alkaline segment in India is dominated by the global
brands: Duracell and Energizer.
KEYWORDS
Marketing Mastermind Magazine, Battery Industry, Alkaline Batteries, Carbon Cell
Batteries, Eveready Industries, Indian Battery Industry, Battery Market, Chinese products, Global
Brands, Agricultural Production, Consumer Products, Electronic Gadgets, Urban Markets.
Industrial Segment:
In the industrial segment, we see demand showing stagnancy or decline for the company's
products across all sectors over the years on the whole and a slowdown in the telecom sector in
particular over the next few quarters as has been witnessed in Q3FY10 thus impacting the overall
growth and profitability of the company. However, the company is planning to increase its
production in the UPS segment from 1.2 million units to 1.8 million units by the end of FY10.

Automotive Segment:
In this segment, the company is looking for more tie ups in the OEM segment. In the motor
cycle segment, the company is in talks with Honda Motors, Japan. The company plans to increase its
two wheeler capacity from 1.8mn units to 2.4mn units in the current year.
The two wheeler battery segment with its higher margins of 25 to30% will improve the
overall margins of the company going forward. But we believe that going forward the domestic
segment will not be showing a major growth and there are chances that even the export sales might
not be as high as witnessed in the 9m FY10.
The company has been in the process of incurring a capex of Rs. 90 crores in2010through its
internal accruals. The company will be investing Rs. 50 crores in the UPS segment and Rs. 20 crores
in the Motor cycle segment. The rest of it will be used for the industrial segment. ARBL is not
looking at expanding the capacity in the automotive batteries segment in the near future.
Valuation & Recommendation

We believe at the current price or Rs. 167 per share, the stock looks fairly priced. We now
recommend to book profits at current levels as we do not see any major upside in the stock from
these levels given the current scenario in the industrial segment where demand has been slowing
down particularly in the telecom sector.
We believe the company would not be able to attain the same level of profitability in
H2FY10 as was in H1FY10, as already witnessed inQ3FY10 results and we expect a similar trend
going forward in Q4FY10. We had given a Book Partial profits recommendation on 1st December
2009 and now looking at the Q3FY10 results recommend a book full profits recommendation
The major manufacturers in the Batteries industry (India) are:
Exide Industries
Hyderabad Batteries Limited.
Amara Raja Power Systems Private Limited.
Tudor Indian limited.
Standard Batteries.

1.3 COMPANY PROFILE
Amara Raja Batteries limited is a member company in Amara Raja Group of

Companies, which has become a leading business, group in India going ahead with its
innovative and collaborative technology and emphasis on Human Resource Development.
Amara Raja Group and its Entrepreneurs: "Sri Galla Ramachandra Naidu" who is an
Electrical Engineer with an experience promoted Amara Raja Group.
Amara Raja Group of Companies:
Amara Raja Power Systems Pvt Ltd (ARPSPL), karakambadi, Tirupathi,
Amara Raja Batteries Limited (ARBL), karakambadi, Tirupathi.
Harsha Electronics Pvt Limited(HEPL) , Karakambadi ,Tirupathi.
Mangal Precision Products Pvt Ltd.,(MPPPL),karakambadi Tirupathi.
Amara Raja Electronics Pvt ltd.,(AREPL), Dighavambhagam, Chittoor.
Board of Directors of ARBL

Mr. U.V. Warulu Scientist
Dr. Upendranath Naimmlagadda NRI
Mr. P. Lakshman Rao Charted Accountant
Mr. Arthur F. Nening.Jr. Johnson Controls Inc. USA
Mr. Douglas C. Brown Johnson Controls Inc. USA
Mr. James T. Luke Johnson Controls Inc. USA
Mr. Jayadev Galla Managing Director
Industrial Batteries Division (IBD)

Amara Raja has become the benchmark in the manufacture of industrial batteries. It is also
having the facility for producing plastic components required for industrial batteries. ARBL is the
first company in India to manufacture VRLA batteries. It has been shaped into limited company with
the advent of GNB industrial battery co. U.S.A. and manufacturing scaled Value Regulated Lead
Acid (VRLA) storage batteries.
The actual installed capacity of IBD is 4,00,000 cells per annum and utilization capacity is
reached to 3,25,000 cells per annum. Types of VRLA batteries manufacture in the industrial battery
division are:

Power stack
Kobat (ups battery)
Brute
Genpro
With the requisite approvals and manufacturing facilities, Amara Raja has established itself as
a reliable supplier of high quality products to the major segments like Telecom, Railway and Power.
COMPETITORS
 Exide
 Prestolite
 AMCO
 Numeric
 American power conversion
 E&C power systems limited
Core Purpose To transform our spheres of influence and to enrich the quality of life by
building institutions that provide better access to better opportunitiesgoods and services to more
people all time.Amara Raja Batteries Private Limited (ARBL):
INCORPORATION:
Amara Raja Batteries Limited was incorporated in 1984 and was co-promoted by A.P.
BATTERIES DEVELOPMENT CORPORATION (APBDC). By virtues of APBDC's equity
participation, ARBL has become a deemed public limited company as per section 43 (A) of the
companies Act, ARBL(P)L is engaged in the manufacture of manufactures industrial and automotive
batteries . The company had a technical collaboration with "H.D.R. Power systems Inc. USA. The
company has entered into a new collaboration with M/s. Rectifier Technologies, Australia for
manufacturing the advanced Switch Mode Power Supply units [SMPS] for battery charging purpose.
Revenue from its automotive battery business is generated not only through the supply of
automotive batteries as part of its OE (Original Equipment) relationships with major automobile
companies, and through the aftermarket battery segment as well. The company also owns a one-of-a-
kind Battery Excellence Centre that is highly automated and enables the firm to leverage its strong
R&D culture for which it has developed quite a reputation.

Owing to its strong R&D facilities, the company developed and introduced its pioneering
VRLA (Valve Regulated Lead Acid) technology that gave it a first mover advantage in the
automotive battery segment (Exide, Amara Raja's biggest competitor started using the VRLA
technology much later).
This expertise in VRLA technology is one of the underlying contributors to its rapid growth
over the last few years. In FY09 the company introduced bike batteries (small VRLA) which proved
to be quite popular. Buoyed by the popularity of its bike batteries and the prospect of achieving
better margins, the company has decided to expand the manufacturing capacity of its small VRLA
battery unit.
The company services its aftermarket through a strong network of retailers that distribute its
branded products such as Amaron, Power zone and Amaron Probike Rider.
The industrial battery division produces lead acid batteries for various industries such as the
power sector, the telecom sector, the processing sector and the railways sector amongst others.
Revenue from this segment from2005-2009 grew at a compounded annual growth rate of 50%and
this is mainly due to the fact that the company caters to high growth industries
. The company is the largest suppliers of stand-by power systems to utilities. The industrial
battery product portfolio of the company comprises of batteries ranging from 4.5Ah (Ampere-hour)
to 5000 Ah.
Some of the impressive projects that the firm has, at its disposal, are that of providing back-up
power for lower power transmitters of Doordashan, to powering the island of Lakshwadeep through
Raja Power Systems.
The company has a very strongpan-India retail network of 18000 retailers across 2300 towns
and a touch point every 5 kms, the largest in the country. Formula 1 driver- Karun Chandok and
Narain Karthickeyancontinue to be brand ambassadors of the firm, creating favorable impression
amongst the youth of the country.
Amara Raja Batteries is extremely committed to its CSR(Corporate Social Responsibility)

activities and devotes significant funds to this area. Allocations for its CSR activities increased from
Rs.10.87 million in FY08 to Rs. 13.66 million inFY09.
Total employee strength of ARBL(P) L is around 1035

1.4 PRODUCT PROFILE

Products of battery division are:
Amara Raja Batteries product line includes -
Industrial products
1. Power Stack
2. Quanta
3. Brute
Automotive products
1. Amaron Hi-life
2. Hi - Way
3. Harvest
4. PRO
5. GO
6. Fresh
7. Optima
8. Shield
Black Batteries
Amaron Black, brought to you by Amara Raja Batteries Limited (ARBL), the largest
manufacturers of Stand-by VRLA Industrial Batteries in the Indian Ocean Rim and Johnson
Controls Inc, USA; the global leader in Interior experience, building efficiency and power
solutions. Long life - Thanks to the reformulated Advantage paste recipe. Maintenance Free
- High heat technology, premium silver alloys

Optima Batteries
The Optima range of batteries comes in three kinds: yellow top, blue top and red top.
Each kind has a specific application it is ideal for. The key feature of the Optima range is its
endurance and ability to withstand the rigors of the most extreme of applications. Optima
Yellow Top: Deep cycle batteries for extreme applications Optima Blue Top: For twice the
life of traditional marine and RV
Hi-way Truck Batteries
Amaron Hi-way truck batteries, brought to you by Amara Raja Batteries Limited
(ARBL), the largest manufacturers of Stand-by VRLA Industrial Batteries in the Indian
Ocean Rim and Johnson Controls Inc, USA; the global leader in Interior experience,
building efficiency and power solutions. Long life - A robust plate design and a ribbed
container make this the ideal long life battery for application

PRO Hi-life Batteries
Amaron PRO Hi-life batteries are made in a QS 9000, ISO 14001 & TS 16949 certified
plant using world class technology and stringent quality control parameters that make them last
long, really long. Some of the other features that add to making the Amaron PRO so good:
longest life, patented BIC vents for enhanced safety, the highest cranking power and a
completely unnecessary 60-month warranty.
SHIELD BATTERIES
The new Amaron Shield, with an unheard of 24 months warranty. A product of

Amara Raja Batteries Ltd. (ABRL), Amaron Shield is a result of a partnership between the
Amara Raja Group and Johnson Controls Inc, USA, the global leader in Interior experience,
building efficiency and power solutions. Long life - The robust plate design and a ribbed
container provide extra strength and improved resista

Customers:
ARBL has prestigious Original Equipment Manufacture (OEM) clients like Ford,
General Motors, Daewoo Motors, Mercedes-Benz, Daimler Chrysler, Maruthi Udyog Ltd,
Premier Auto Ltd and recently acquired a referential supplier alliance with Ashok Leyland,
Hindustan Motors. The company entered the replacement battery segment with the launch
of Amaron Hi-life auto batteries.
Major Competitors:
 Exide
 Prestolite
 Amco
 Numeric
 American power conversion and
PLANT PROFILE AND PHILOSOPHY
The factory is spread over an area of 150 acres with a current built - up area of 44,000 sq.
mts. The present capacity is 5, 75,000 nos.
ARBL got ISO 9001 certificate in the year 1997 as ARBL assured quality through out the
whole cycle from design through production, installation and servicing. It also depicts the efficiency
with which the operation are being carried on as it could obtain this certificate in such a short span of
five years after commencing the operations in 1992-93.
Conventional Chargers
Application(s):
Power process Industries
Power Generating Stations
Power Transmission
Oil & Natural gas plants
Sub-stations
Sea-shore platforms
Switch Mode Rectifiers (SMR)

Quality Policy:
Our aim is to achieve customer satisfaction through the collective commitment of our
employees in design, manufacture and marketing of reliable power systems, batteries, allied products
and services.
Culture & Environment:

Amara Raja is putting in place a number of HRD initiatives to foster a spirit of togetherness
and a culture of meritocracy. Involving employees at all levels in building organizational support
plans and in evolving vision for the organization.
Benchmark pollution control measures, energy conservation measures, waste reduction

schemes, massive greenbelt development programs, employee health monitoring and industrial
safety programs have already helped us take our environment management program further.
Amara Raja has now secured the ISO-14001 certification in the year 2002 (evidence of our
concern for the world around us and in which our children will live).Organizations Network is
spread all over the India:
Its Corporate Operations Office is situated at Chennai; other Marketing Offices &
Customer Support Centers are at
North: New Delhi, Chandigarh, Ghaziabad, Lucknow, Jaipur etc.,
West: Mumbai, Pune, Ahmedabad, Indore, Nagpur etc.,
South: Chennai, Bangalore, Hyderabad, Cochin, Coimbater, Vijayawada
East: Kolkata, Bhubaneswar, Gauhati, Patna, Ranchi etc.,
Core Values
Work with integrity
Customer satisfaction
Effective employee selection, employee development, motivation & recognition
Improvement & innovation in every element of our business Awards:
 "The Spirit of Excellence" - Award by Academy of Fine Arts, Tirupati.
 "Best Entrepreneur of the year 1998" - Award by Hyderabad Management
Association, Hyderabad.
 "All Round Performance in Industrial Activity including Promotion/Expansion

 Effort" in state for the year 1997-98 - Award by Federation of Andhra Pradesh
 "Industrial Economist Business Excellence Award" - 1999 - Award by the Industrial

Economist, Chennai.
 "Excellence Award" - by "Institute of Economic Studies (IES)", New Delhi on the

29th April 1999 at New Delhi.
 "Udyog Rattan Award" - BY Institute of Economic Studies, New Delhi.
 "Excellence in Environment Management" - By Andhra Pradesh Pollution Control

Board, Chittoor on 5th June 2002 at Hyderabad

CHAPTER – 2
REVIEW OF LITERATURE

2. REVIEW OF LITERATURE
In 21st Century, the approaches of the organization towards its customers have
dramatically changed. The shift paradigm was mainly attributed to the stringent competition
it is facing. Growing consumerism among the customers, who demand value from the
product increased possibilities of information interchange and technologies advancements
that made things happen, which once considered as a more dreams.
“Companies should think about the millennium as a golden opportunity to gain mind
share and heart share”
- Philip Kotler.
Era of Liberalization and Globalization
The policies adopted by the nation from the days of protectionism to opening up the
economies have also been the reason of consideration. The availability of the choice has led
the customer to think and act before he dies. The saying “Customer is the King” was gained
importance. Most of the organization accepted the promise that, an organization must
become more knowledge – intensive and value-oriented in order to serve the customers.
Every business unit now has theoretical access to the best products services and ideas from
all around it have to think and act the benefit of the customer.
The gradual opening up of economies by respective government paved the way of the
multinational companies resulting in an extremely competitive market leaving benefits to the
customers.
Customers are getting benefited because their felt and unfelt needs are taken care by
the marketers of the day. He improvements of marketing efforts gave shape to after sales
services. Now organization is thinking upon the concepts like relationship marketing,
involving the customers as partners of growth for the organization.
All this started with the slow process of CHANGE. Changing of the market from
caveat to emptor, which has produced great change on the quality improvement, technology
thereby resulting customer.

SATISFACTION
As defined by Philip Kilter, the term ‘Satisfaction’ refers to “a person’s feelings of

pleasure, disappointment resulting from comparing a product’s perceived performance or
outcome in relation to his/her expectations”.
Hence it has become extremely to deliver to the customers both the tangible and the
intangible benefits as demanded by him. The customers satisfaction is viewed as an integral
part of the total quality package offered to the customers. Nowadays, the customers look for
goods and services in terms of brand image, value of the product and performance.
The level of satisfaction of a customer especially after his purchasing the commodity
always depends upon the offers performance in relation to its expectations. Hence
satisfaction is a function of perceived performance and Performance and exceeds expectation,
the customer is said to be delighted or lightly satisfied.
High satisfaction level of customers will led to create an emotional affinity with the
brand, not just a preference. The result is customer loyalty to the brand.
The switching option – is it an opportunity? Or threat?
The growing importance of customer satisfaction due to the switching option

available to him form one product the another of his choice, whenever he wants to have
product the successful markets will always depends upon his ability to create latent need and
makes the customer recognizes the unknown needs. The existing customers, who are just
satisfied, still find it easy to switch to other product, which is coming with better offer. Those
are highly satisfied are much ready to switch to the new product, especially, when they are
convinced that the new product will bring in good value to him.
Thus, the switching option of the customer is always a challenge to the marketer. The
proactive market always tries to make it an opportunity by soliciting the information about
the satisfaction levels of existing customers, formulating the appropriate strategy, thereby
consolidating his market share, apart from continuing his endeavor to grab or to create new
customer. For customer-centered companies, customer satisfaction is both a goal and
marketing tool.
The Constraints
Although the customer-centered firm seeks to create high customer satisfaction, its
mail goal is not to maximize customer satisfaction.

First, the company can increase customer satisfaction by towering its price or increasing its
services, but the result may be lower profits for the short-run.
Secondary, the company might be able to increase its profitability by means other
than increase satisfaction. For example, improving the process of manufacturing or by
investing more on the Research and Development.
Third the company has many stake holders, who include employees, dealers, suppliers
and shareholders, spending more to increase the customers of other partners. Ultimately the
company must operate on the philosophy that it is trying to deliver a high-level of customer
satisfaction subject to delivery at least acceptable levels of satisfaction, to the other
stakeholders, within the constraints of its total resources.
Post-Purchase Behavior
After purchasing the product, the customer will experience some level of satisfaction
or dissatisfaction. The marketer has to monitor continuously the post-Purchase action of
customer, which include the product usage level and disposal mechanism adapted by the
customer.
Hence the buyer’s satisfactions a function of the closeness between buyer’s

expectation about the product and the products perceived performance. Consumer Form their
expectation on the basis of message received from the other who include peers, opinion
leader’s friends, family members and other information sources scanned by the customer
himself. If the seller exaggerated the benefits of the products, customers will experience
disconfirmed expectations there by resulting in dissatisfaction. The greater will be the
consumer dissatisfaction.
Diversity of Opinion
The given level of mismatch between the expectations and experiences with the
product, tend to lead strategies by customers.
The maximum, out best advertisement is a satisfied customers, notes strongly about
the effects of satisfaction. The strategies adopted by the customers about the disposal of the
product, especially when he is dissatisfied with the value of the product will adversely affect
the prospects of the product. The power of work-of-mouth communication should not be
under estimated.

Some customers magnify the gap, and remain highly dissatisfied. They may even
propagate his experiences with the product to the other people, who came for his advice.
Some others may minimize the gap, and they tend to respond to the other products that are
offered by the other marketer.
The importance of post-purchase satisfaction suggests that, sellers must make product
claims truthfully to represent the products likely performance. Some sellers might undertake
performance levels so that consumers experience higher than expected satisfaction with the
product.
Further Purchase Decision
The consumer’s satisfaction levels with reference to the product will continues to
influence his further purchases of the same product. Apart from affecting further purchases
of improvement or new additions of product lines of the same brand.
The Strategies of a Dissatisfied Customer
 Dissatisfied consumers respond differently.
 They may abandon or return the product.
 They may seek information that confirms high value.
 They may take public actions such as complaining to the company, may approach an
advocate for his opinion, given the levels of consumerism, he may even approach
other groups to complain such as consumers forms (or) any other government
agencies.
 This other actions may include making a decision to stop buying the product again
(exit options). In all these cases, the seller has done a poor job of satisfying the
customer.

Tools for Tracking and Meaning Customer Satisfaction
Complaints and Suggestions Systems
A customer – centered organization makes it easy for its customers to deliver

suggestion and complaints. Many restaurants and hotels provide facilities for guests to report
their likes and dislikes. A hospital could place suggestion boxes in the corridors, supply
comment card to the existing patients, and hire a patient advocate to handle patient
grievances. Some customer-centered hot lines provide free P & G General Electric and
Whirlpool established customer hot lines with too free and telephone numbers to maximize
the case with customers can inquire make suggestion or complaints. These information flows
provide these companies with many good.
Customers Satisfaction Surveys
Studies show that while customers are dissatisfied with one out of every four
purchases less than 5% of dissatisfied customers will complain. Most customers will buy less
of switch suppliers rather than complain.
Therefore, companies make telephone calls to a random sample of their recent

customers and ask if they were either very satisfied or satisfied or indifferent or somewhat
dissatisfied, or very dissatisfied with the various aspects of the company’s performance.
They also solicit buyer’s views on their competitor’s performance.
While collecting the customer satisfaction data, it also useful to use additional
questions to measure the customers purchase intention. This will normally be high of the
customers satisfaction is high, it is also useful to measure the customers score indicates that
the company is producing high customer satisfaction, likelihood or willingness to recommend
the company and brand to other persons a high positive word-of-mouth.
Ghost Shopping
Companies can hire persons to pose as potential buyers to report their findings on
strong and points they experienced in buying the companies and competitors products. These
ghost shoppers can even pose certain problems to test whether the company’s sales personnel
handle the situation efficiently. This a ghost shopper can complain about a restaurants food
to test how the restaurant handles this complaint.

Not only should companies hire ghost shoppers, but also manages themselves should leave
their office from time-to-time, enter company
And competitor sales situation, where they are unknown, and experience first hand treatment
they receive as customers. A variant of this is for managers to phone their own company
with different questions and complaints to see how call is handled easy and enable them to
act more rapidly to resolve problems.
Lost Customer Analysis
Companies should contact customers who have stopped buying or how have switched
to another supplier to learn why this happened when IDM losses a customer, it mounts
thorough effort to learn where it failed. Not only it is important to conduct exit interviews
when customers first shop buying, but also to monitor the customer loss rate, which if
increasingly clearly indicates that the company is failing to satisfy its customers.
Some cautions in Measuring Customer Satisfaction
When customers rate their satisfaction with an element of the company’s performance
say, delivery the company needs to recognize that customers vary in how they define good
delivery. It could mean early delivery, on-line delivery, order completeness and so on. Yet if
the company had to spell out in every eement in detail, customers would face a huge
questionnaire. The company must also realize that the customers can report being “highly
satisfied” for different reasons. One may be easily satisfied most of the time and the other
might be hard to please, but was pleased on this occasion.
Companies should also note managers and sales people could manipulate their rating
customer satisfaction. They can also try to exclude unhappy customers from the survey.
Another danger is that if customer knows that the company will go out of its way to please
customers, some customers may express high dissatisfaction (even if satisfied) in order to
receive more connection

The marketing concepts are built on the premise that marketers first identified
consumer’s needs and then develop products and serviced to satisfy those needs. Consumer
researcher offers a set of diverse methods to identify such needs. Consumer research is also
used to better understand consumption behavior. It is used to identify and locate appropriate
target markets and to learn their media habits. It is sued to identify both felt and unfelt needs
to learn how consumers perceive products and brand and stores. What their attitude before
and after promotional components and how why they make their consumer decisions?. Many
of these applications of consumer research are managerial in perspective. They are designed
to help a marketer make specific marketing decisions. Concerning product, price, promotion
and distribution.
Consumer research provides the basis for the development of new product and service
and concept to meet targeted consumer needs. It also enables marketer to built consumer
“Meaning” into the product are service by discovering which attributes are most important to
the target market and integrating them into the product are service design.
How the consumer helps manufacturer
The dealer comes into existence when communications is difficult with consumers
and it is found necessary to have a point of distribution. The consumer helps the manufacturer
by formulating the policy if manufacturers according to the demand and assists them in
securing the markets of their goods. The consumer also reveals the manufacturers from the
necessity of having sales organizations of their own.
The manufacturers are not put to that task of collection and securing orders and the
numbers of accounts they have to open are smaller than when dealing with the consumers.
The consumers are in a position to advice the manufacturers as to the changes are
alternatives. Which should be introduced in their products?
The company occupies a very important stabilized position. The company not only
assists manufacturers to act as the link in the chain of distribution between the manufacturer
and the consumer for which the purpose of maintenance efficient and comprehensive
organization. The company can assess the public demand and see that marketable goods are
manufacturer thus protecting the manufacturer from wasteful and indiscriminate production
as well as the consumer against goods which are neither satisfactory nor of good value.

What is Customer Satisfaction?
Everyone knows what satisfaction is, until asked to give a definition' Then, it seems’
nobody knows. This quote from Richard L. Oliver, respected expert and longtime writer and
researcher on the topic of customer satisfaction, expresses the challenge of defining this most
basic of customer concepts. Building from previous definitions' Oliver offers his own formal
definition:
“Satisfaction is the consumer's fulfillment response. It is a judgment that a product or

service feature, or the product or service itself, provides a pleasurable level of consumption-
related fulfillment.”
In less technical terms, we translate this definition to mean that satisfactorily is the
customers' evaluation of a product or service in terms of
Whether that product or service has met their needs and expectations. Failure to meet
needs and expectations is assumed to result in dissatisfaction with the product or service’
In addition to a sense” of fulfillment in the knowledge that one's needs have been
met, satisfaction can also be related to other types of feelings, depending on the particular
Context or type of service. For example, satisfaction can be viewed as contentment-more. of

a passive response that consumers may associate with services they don't think a lot about or
services that they receive routinely over time' Satisfaction may also be associated with
feelings of pleasure for services that mke the consumer feel good or are associated with a
sense of happiness. For those services that really surprise the consumer in a positive way,
satisfaction may mean delight. And in some situations, where the removal of a negative leads
to satisfaction, the consumer may associate a sense of relief with satisfaction.
It is also important to recognize that although we tend to measure consumer

satisfaction at a particular point in time as if it were static, satisfaction is a dynamic, moving
target that may evolve over time, influenced by a variety of factors. Particularly when product
usage or the service experience takes place over time, satisfaction maybe rightly variable
depending on which point in the usage or experience cycle one is focusing on. Similarly, in
the case of very new services or a service not previously experienced, customer expectations
may be barely forming at the point of initial purchase, these expectations will solidify as the
process unfolds and the consumer begins to form his or her perceptions. Through the service

cycle the Consumer may have a variety of different experiences, some good, some not good-
and each will ultimately impact satisfaction.
What Determines Customer Satisfaction?
Customer satisfaction is influenced by specific product or service features and by

perceptions of quality as suggested by Figure 4.1. Satisfaction is also influenced by
customers' emotional responses, their attributions, and their perceptions of equity.
Product and Service Features
Customer satisfaction with a product or service is influenced significantly by the

customer's evaluation of product and services features. For a service such as a resort hotel,
important features might include the pool area, access to golf facilities, restaurants, room
comfort and privacy, helpfulness, and courtesy of staff, room price, and so forth. In
conducting satisfaction, studies, most firms will determine through some means (often focus
groups) what the important features and attributes are for their service and then measure
perceptions of those features as well as overall service satisfaction. Research has shown that
customers of services will make trade-offs among different service features (for example,
price level versus quality, versus friendliness of personnel versus level of customization),
depending on the type of service being evaluated and the criticality of the service.
Consumer Emotions
Customers' emotions can also affect their perceptions of satisfaction -with products
and services. These emotions can be stable, preexisting emotions-for example, mood state or
life satisfaction. Think of times when you are a very happy stage in your life (such as when
you are on vacation), and your good, happy mood and positive frame of mind have
influenced how you feel about the services you experience. Alternatively, when you are in a
bad mood your negative feelings may carry over into how you respond to services, causing
you to overreact or respond negatively to any little problem.
Specific emotions may also be induced by the consumption experience itself,

influencing a consumer's satisfaction with the service. Research done in a river-rafting
context showed that the river guides had a strong effect on their customers' emotional
responses to the trip and that those feelings (both positive and negative) were linked to
overall trip satisfaction. Positive emotions such have happiness pleasure, elation, and a sense
of warm-heartedness enhanced customers' satisfaction with the rafting trip. In turn, negative

emotions such as sadness, sorrow, regret, and anger led to diminished customer satisfaction.
Overall, in the rafting context, positive emotions had a stronger effect than negative ones.
Similar effects of emotions on satisfaction were found in a Finnish study that looked at
consumers' satisfaction with a government labor bureau, service.l6 In that study, negative
emotions including anger, depression, guilt, and humiliation had a strong effect on customers,
dissatisfaction ratings.
Attributions for Service Success or Failure
Attributions-the perceived causes of events-influence perceptions of satisfaction as

well. When they have been surprised by an outcome (the service is either much better or
much worse-than expected), consumers tend to look for the reasons, and their assessments of
the reasons can influence their satisfaction' For example, if a customer of a weight-loss
organization fails to lose weight as hoped for, she will likely search for the for the causes –
was it something she did, was the diet plan ineffective, or did circumstances simply not allow
her to follow the diet regimen-before determining her level of satisfaction or dissatisfaction
with the weight-loss company. For many services customers take at least partial
responsibility for how things turn out.
Even when they don't take responsibility for the outcome, customer satisfaction may
be influenced by other kinds of attributions. For example, in research done in a travel agency
context it was found that customers were less dissatisfied with a pricing error made by the
agent if they felt the reason was outside the agent's control or if they felt it was a rare mistake,
unlikely to occur again.
Perceptions of Equity or Fairness
Customer satisfaction is also influenced by perceptions of equity and fairness.2o

Customers ask them selves: Have I been treated fairly compared with other customers'? Did
other customers get better treatment, better prices, or better quality service? Did I pay a fair
price for the service? Was I treated well in exchange for what I paid and the effort I
expended? Notions of fairness are central to customers' perceptions of satisfaction with
products and services. The example of Sears Auto Centers division illustrates consumers'
strong reactions to unfair treatment. Over a decade ago the division was charged with
defrauding customers in 44 states by performing unnecessary repairs. Sears employees had
been rewarded based on the quantity of repairs sold resulting in substantial unnecessary
charges to customers. The $27-million Sears paid settling complaints and the additional loss

of business all resulted from extreme dissatisfaction of its customers over the unfair
treatment.
Other Consumers, Family Members, and Coworkers
In addition to product and service features and one's own individual feelings and
beliefs, consumer satisfaction is often influenced by other people.22 For example;
satisfaction with a family vacation trip is a dynamic phenomenon,
Influenced by the reactions and expressions of individual family members over the
duration of the vacation. Later, what family members express in terms of satisfaction or
dissatisfaction with the trip will be influenced by stories that are retold among the family and
selective memories of the events. Similarly, the satisfaction of the rafters in Figure 4.2 is
certainly influenced by individual perceptions, but it is also influenced greatly by the
experiences, behavior, and views of the other rafters. In a business setting, satisfaction with a
new service or technology-for example, a new customer relationship management software
service-will be influenced by individuals' personal experiences with the software itself, but
also by what others say about it in the company, how others use it and feel about it, and how
widely it is adopted in the organization. In Chapter 12 we will come back to this topic as we
look at strategies for involving and managing other consumers to maximize satisfaction in the
service experience.
National Customer Satisfaction Indexes (N.C.S.I)
Because of the importance of customer satisfaction to firms and overall quality of life,
many countries how have a national index that measures and tracks customer satisfaction at a
macro level.23 Many public policymakers believe that these measures could and should be
used as tools for evaluating the health of the nation's economy, along with traditional
measures of productivity and price. Customer satisfaction indexes begin to get at the quality
of economic output, whereas more traditional economic indicators tend to focus only on
quantity.
The American Customer Satisfaction indexes (A.C.S.I)
The ACSI, developed by researchers at the National Quality Research Center at the
University of Michigan, is a measure of quality of goods and services as experienced by
consumers. The measure tracks customer perceptions across 200 firms representing all major
economic sectors, including government agencies. Within each industry group, Major

industry segments are included" and within each industry the largest companies in that
industry are selected to participate. For each company approximately 250 interviews are
conducted with current customers. Each company receives an ACSI score computed from its
customers' perceptions of quality, value, satisfaction, expectations, complaints, and future
loyalty.
WHAT ARE SERVICES?
Put in the simplest terms, services are deeds, processes, and performances. Our
opening vignette illustrates what is meant by this definition. The services offered by IBM are
not tangible things that can be touche4 seen, and felt, but rather are intangible deeds and
performances. To be concrete, IBM offers repair and maintenance service for its equipment,
consulting services for IT and e-commerce applications' training services, web design and
hosting, and other services. These services may include final, tangible report,-a website, or, in
the case of training, tangible instructional materials. But for the most part, the entire service is
represented to the client through problem analysis activities, meetings with the client, follow-
up calls, and reporting a series of deeds, processes, and performances. Similarly, the core
offerings of hospitals, hotels, banks, and utilities comprise primarily deeds and actions
performed for customers.
While we will rely on the simple' broad definition of services, you should be aware
that over time services and the service sector of the economy have been defined in subtly
different ways. The variety of definitions can often explain the confusion or disagreement
people have when discussing services and when describing industries that comprise the
service sector of the economy. Compatible with our simple, broad definition is one that
defines services to "include all economic activities whose output is not a physical product or
construction, is generally consumed at the time it is produce and provides added value in
forms (such as convenience' amusement, timeliness, comfort, or health) that are essentially
intangible concerns of its first purchaser. This definition has been used also to delineate the
service sector of the economy, as illustrated.
Services versus Customer Service
As we begin our discussion of services marketing and management, it is important to draw

the distinction between services and customer service' Services, as we have broadly defined,
encompass a wide range of industries. All of the following companies are considered service

companies: AT&T (telecommunication) - Marriott International (hotels), American Airlines

(transportation), Bank One (financial services)' However, services can be offered to the
marketplace by manufacturers and technology companies as well. IBM and Compaq
(traditionally considered manufacturers) offer information technology (IT) consulting
services to the marketplace, competing with firms like EDS and Accenture, traditional service
industry firms. All of the companies just mentioned are marketing and delivering services to
customers.
Customer service
Customer service is also provided by all types of companies-including manufacturers,

IT companies, and service Companies. Customer service is the service provided in support of
a company’s core products. Customer service most often includes answering questions,
taking orders, dealing with billing issues, handlings complaints, and perhaps scheduling
maintenance or repairs. Customer service can occur on site (as when a retail employee helps a
customer find a desired item or answers a question), or it can occur over the phone or via the
Internet. Many companies operate customer service call centers, often staffed around the
clock. Typically there is no charge for customer service. Quality customer service is essential
to building customer relationship. It should not, however, be confused with the services
provided for sale by a company.
To illustrate: Federal Express markets and delivers services, but it also provides a
high level of customer service. Its services include overnight package delivery and also
logistical services including inventory management, warehousing, and distribution using
state-of-the-art technology. These services are offered worldwide, currently in more than 200
countries. FedEx’s high levels of customer loyalty depend on the quality of these cores.
Service, as well as the Customer service the company provides to back up its offering. A well
trained and empowered telephone staffs as well as high tech tracking online systems
accessible to its customers ensure that FedEx's customer service is superb.
As we progress through the text, you will see many examples of services offered for
sale as well as customer service in support of product and service offerings'.

Tangibility Spectrum
The broad definition of services implies that intangibility is a key determinant of

whether an offering is a service. While this is true, it is also true that very few products are
purely intangible or totally tangible. Instead, services tend to be more intangible than
manufactured products, and manufactured products tend to be more tangible than services.
For example, the fast-food industry while classified as a service, also has many tangible
components such as the food" the packaging, and so on. Automobiles, while classified within
the manufacturing sector, also supply many intangibles, such as transportation. Throughout
this text, when we refer to services we will be assuming the broad definition of services and
acknowledging that there are very few "pure services,, or "pure goods." The issues and
approaches we discuss are directed toward those offerings that lie on the right side, the
intangible side, of the spectrum.
As suggested earlier, intangibles arc not produced only in the service sector of the
economy. Manufacturers such as Boeing Airplane Company and Ford Motor Company also
produce products on the right end of the spectrum, both for sale to external consumers and to
support internal production processes. For example, Boeing has provided consulting services
and demand forecasting services for its airline customers. And within Boeing large
departments (such as data processing and legal services) provide Internal services to the
organization.
Trends in the Service Sector
Although we often hear and read that many modern economies are dominated by
services, the United States and other countries did not become service economies overnight.
As early as 1929, 55 percent of the working population was employed in the service sector in
the United States, and approximately 54 percent of the gross national product was generated
by services in 1948. That the trend toward services has continued, until in 1999 services
represented 78 percent of the gross domestic product (GDP) and 80 percent of employment.
Note also that these data do not include internal services provided within a manufacturing
company (such as IBM or Boeing) or services that these manufacturers sell externally.

CUSTOMER EXPECTATIONS OF SERVICE
Customer expectations are beliefs about service delivery that function as standards of
reference points against which performance is judged. Because customers compare their
perceptions of performance with these reference points when evaluating service quality,
thorough knowledge about customer expectations is critical to services marketers. Knowing
what the customer expects is the first and possibly most critical step in delivering quality
service. Being wrong about what customers want can mean losing a customer's business
when another company hits the target exactly. Being wrong can also mean expending money,
time, and other resources on things that don't count to the customer. Being wrong can even
mean not surviving in a fiercely competitive market.
Among the aspects of expectations that need to be explored and understood for
successful services marketing are the following: What types of expectation standards do
customers hold about services? What factors most influence the formation of these
expectations? What role do these factors play in changing expectations? How can a service
company meet or exceed customer expectations?
FACTORS THAT INFLUENCE CUSTOMER EXPECTATIONS OF SERVICE
Because expectations play such a critical role in customer evaluation of services,

marketers need and want to understand the factors that shape them. Marketers would also like
to have control over these factors as well. But many of the forces that influence customer
expectations are uncontrollable. In this section of the chapter we try to separate the many
influences on customer expectations.
Sources of Desired Service Expectations
The two largest influences on desired service level are personalneeds and
philosophies about service. Personal needs those states or conditions essentialto the physical
or psychological well-being of the customer, are pivotal factorsthat shape what we desire in
service. Personal needs can fall into many categories, includingphysical, social,
psychological, and functional. A fan who regularly goes tobaseball games right from work,
and is therefore thirsty and hungry hopes and desiresthat the food and drink vendors will pass
by his section frequently, where as a fan whoregularly has dinner elsewhere has a low or zero
level of desired service from the vendors.A customer with high social and dependency needs
may have relatively high expectationsfor a hotel's ancillary services, hoping, for example,

that the hotel has a barwith live music and dancing. The effect of personal needs on desired
service is illustratedby the different expectations held by two business insurance customers.
Some customers are more demanding than others, having greater sensitivity to, and
higher expectations of, service. Enduring service intensifiers are individual, stable factors that
lead the customer to a heightened sensitivity to service. One of the most important of these
factors can be called derived service expectations, which occur when customer expectations
are driven by another person or group of people. A niece from a big family who is planning a
90th birthday party for a favorite aunt is representing the entire family in selecting a
restaurant for a successful celebration. Her needs are driven in part by the derived
expectations from the other family members. A parent choosing a vacation for the family, a
spouse selecting a home-cleaning serve
CONSUMER RELATIONS
We will complete our decision of consumer decision making with a brief

consideration of relationship marketing. Many firms have established relationship marketing
programs to faster usage loyalty and a commitment to their company’s products and services.
In this way relationship marketing is aimed at creating strong lasting relationships with a core
group of customers. The emphasis is on developing long-term bonds with customers by
making them feel good about how the company interacts with them and by giving them some
kind of personal connection to the business.
Ultimately it is advantage to develop a long-term relationship with existing customer

because it is easier and less expensive to make an additional sale to an existing customer than
to make a new sale to a new consumer.
However, the effort involved for the firm in developing and maintaining a customer
relationship must determine the “life time value” of a customer to ensure that the cost of
obtaining, servicing and communicating with the customers do not exceed the potential
profits.
CONSUMER SATISFACTION
Satisfaction is a function of the difference between perceived performance and

expectations. Companies seeking to win in today’s markets must track their customers
expectations perceived company’s performance and customer satisfaction. While assisting the

satisfaction level a company must not conclude that it can get a full picture of customer
satisfaction and dissatisfaction by simply running a complaint and suggestions systems.
Some times customers may feel that their complaints are minor of that they will be
made to feel bad, or that no remedy will be offered. The result is that the company has
needlessly lost customers.
Therefore the company instead using complaints level as a measure of customer’s

satisfaction obtaining a direct measure of customer satisfaction by conducting periodic
surveys would provide more appropriate measure. Thus questionnaire can be made to a
random sample of their resent customers to fine out how they feel about various aspects of
the companies’ performances. They can also solicit buyer’s view on the competitor’s
performances.
So they respondents can be asked a list of problems they hear; had with the offered to
list out improvement needed.
Companies could also ask the respondent to rate various elements of the offers in
terms of the importance of each element anyhow will the company performance each
element. So the researcher as took up a comprehensive study on the consumer satisfaction of
automotive batteries.
Hence the buyer’s satisfactions a function of the closeness between buyer’s

expectation about the product and the products perceived performance. Consumer form their
expectation on the basis of message received from the other who include peers, opinion
leaders friends, family members and other information sources scanned by the customer
himself. If the seller exaggerated the benefits of the products, customers will experience
disconfirmed expectations there by resulting in dissatisfaction. The greater will be the
consumer dissatisfaction.
Diversity of Opinion
The given level of mismatch between the expectations and experiences with the
product, tend to lead strategies by customers.
The maximum, out best advertisement is a satisfied customers, notes strongly about
the effects of satisfaction. The strategies adopted by the customers about the disposal of the
product, especially when he is dissatisfied with the value of the product will adversely affect

the prospects of the product. The power of work-of-mouth communication should not be
under estimated.
Some customers magnify the gap, and remain highly dissatisfied. They may even
propagate his experiences with the product to the other people, who came for his Advice.
Some others may minimize the gap, and they tend to respond to the other products that are
offered by the other marketer.
The importance of post-purchase satisfaction suggests that, sellers must make product
claims truthfully to represent the products likely performance. Some sellers might undertake
performance levels so that consumers experience higher than expected satisfaction with the
product.
Further Purchase Decision
The consumer’s satisfaction levels with reference to the product will continues to
influence his further purchases of the same product. Apart from affecting further purchases
of improvement or new additions of product lines of the same brand.
The Strategies of a Dissatisfied Customer
 Dissatisfied consumers respond differently.
 They may abandon or return the product.
 They may seek information that confirms high value.
 They may take public actions such as complaining to the company, may
approach an advocate for his opinion, given the levels of consumerism, he
may even approach other groups to complain such as consumers forms (or)
any other government agencies.
 This other actions may include making a decision to stop buying the product
again (exit options). In all these cases, the seller has done a poor job of
satisfying the customer.
Tools for Tracking and Meaning Customer Satisfaction
Complaints and Suggestions Systems
A customer centered organization makes it easy for its customers to deliver

suggestion and complaints. Many restaurants and hotels provide facilities for guests to report
their likes and dislikes. A hospital could place suggestion boxes in the corridors, supply
comment card to the existing patients, and hire a patient advocate to handle patient
grievances. Some customer-centered hot lines provide free P & G General Electric and
Whirlpool established customer hot lines with too free and telephone numbers to maximize
the case with customers can inquire make suggestion or complaints. These information flows
provide these companies with many good ideas and enable them to act more rapidly to
resolve problems.
Customers Satisfaction Surveys
Studies show that while customers are dissatisfied with one out of every four
purchases less than 5% of dissatisfied customers will complain. Most customers will buy less
of switch suppliers rather than complain.
Therefore, companies make telephone calls to a random sample of their recent

customers and ask if they were either very satisfied or satisfied or indifferent or somewhat
dissatisfied, or very dissatisfied with the various aspects of the company’s performance.
They also solicit buyer’s views on their competitor’s performance.
While collecting the customer satisfaction data, it also useful to use additional
questions to measure the customers purchase intention. This will normally be high of the
customers satisfaction is high, it is also useful to measure
The customers score indicates that the company is producing high customer
satisfaction, likelihood or willingness to recommend the company and brand to other persons
a high positive word-of-mouth.
Ghost Shopping
Companies can hire persons to pose as potential buyers to report their findings on strong and
points they experienced in buying the companies and competitors products. These ghost
shoppers can even pose certain problems to test whether the company’s sales personnel
handle the situation efficiently. This a ghost shopper can complain about a restaurants food
to test how the restaurant handles this complaint. Not only should companies hire ghost
shoppers, but also manages themselves should leave their office from time-to-time, enter
company and competitor sales situation, where they are unknown, and experience first hand
treatment they receive as customers. A variant of this is for managers to phone their own
company with different questions and complaints to see how call is handled.

Lost Customer Analysis
Companies should contact customers who have stopped buying or how have switched to
another supplier to learn why this happened when IDM losses a customer, it mounts thorough
effort to learn where it failed. Not only it is important to conduct exit interviews when
customers first shop buying, but also to monitor the customer loss rate, which if increasingly
clearly indicates that the company is failing to satisfy its customers.
Some cautions in Measuring Customer Satisfaction
When customers rate their satisfaction with an element of the company’s performance
say, delivery the company needs to recognize that customers vary in how they define good
delivery. It could mean early delivery, on-line delivery, order completeness and so on. Yet if
the company had to spell out in every element in detail, customers would face a huge
questionnaire. The company must also realize that the customers can report being “highly
satisfied” for different reasons. One may be easily satisfied most of the time and the other
might be hard to please, but was pleased on this occasion.
Companies should also note managers and sales people could manipulate their rating
customer satisfaction. They can also try to exclude unhappy customers from the survey.
Another danger is that if customer knows that the company will go out of its way to please
customers, some customers may express high dissatisfaction (even if satisfied) in order to
receive more connections.

CHAPTER – 3
RESEARCH METHODOLOGY
NEED FOR THE STUDY
SCOPE OF THE STUDY
OBJECTIVES OF THE STUDY\
METHODOLOGY OF THE STUDY
LIMITATIONS OF THE STUDY

3. RESEARCH METHODOLOGY
3.1. NEED FOR THE STUDY
Now a day it is very clear that market is having drastic changes and all the companies
are acting according to it because to survive in the market and this should be achieved by
studying about the customer opinions and analyzing their future requirements. This study is
definitely going to help to analyze the customers and can take necessary steps for the
improvement of the service from both the company side and as well as from the customers' side.
The company wants to increase its sales and also attract the new customers wants to
enhance the service provide by it. In part of that it wants know how for the customers are
satisfied with their current services and trace out their loopholes and hogging points This made
up need for carrying out of research on customer satisfaction at ARBL.

3.2 SCOPE OF THE STUDY
 To study the customer perception towards AMARARAJA BATTERIES PVT.LTD
 Through using questionnaire collect data from ARBL.
 Satisfied customers are more compelled to be repeat customers.
 Employees learn skills necessary to create a positive customer experience.
 Customers feel they are the most important part of your business

3.3 OBJECTIVES OF THE STUDY
 To find out the customer satisfaction about AMARARAJA BATTERIES provided by
ARBL.
 To find out the awareness level of customers.
 To find out the level of product satisfaction among customers.
 To collect the suggestion from the customer to improve the customer satisfaction.

3.4 METHODOLOGY OF THE STUDY
Research means a scientific and systematic search for pertinent information on specific
topic. Research is a care full investigation or inquiry especially through search for new facts in
any branch of knowledge. Research comprises defining and redefining problems, formulating
hypothesis or suggested solution: collecting, organizing and evaluating data; making deductions
and reaching conclusions; and at last carefully testing the conclusions to determine whether they
fit the formulating hypotheses.
‘Methodology' is defined as "the study of methods by which we gain knowledge, it deals
with cognitive processes imposed on research the problems rising from the nature of its subject
matter."
METHOD OF RESEARCH
 Exploratory Research,
 Descriptive Research
Exploratory Research:
Exploratory research studies are also termed as formulate research studies. The main
purpose of such studies in that of formulating a problem for more precise investigation or of
developing the working hypothesis forms an operational point of view.
Descriptive Research:
Diagnostic Research studies determine the frequency with something occurs or its
association with something else.
In this project, information pertaining to customer needs satisfaction and their
demographic profile was collected; hence it is a descriptive research.

RESEARCH INSTRUMENT
The research instrument used in this study "structured questionnaire".
Structured questionnaire are those questionnaire in which there are predetermined
question relating to the aspect for which the researcher collects data. The questions are
presented with exactly the same wording and in the same order to all the respondents.
QUESTIONNAIRE DESIGN:
The structured questionnaire for Appraisal System with the following types of
questionnaires open ended, closed ended, multiple choice, types of questions.
DATA COLLECTION:
Data refers to information or facts. It includes numerical figures, non-numerical figures,
descriptive facts, and qualitative information. The task of data collection begins after research
problem has been defined and research plan has been decided. The nature of the data is both
Primary and Secondary data.
PRIMARY DATA:
Primary data were collected through Questionnaire and direct personal interview. The
Questionnaire was framed as such a manner to obtain correct information, graded suitably for
the study. All Questionnaires were distributed to the respondents and collected immediately
from the respondents.
SECONDARY DATA:
The secondary data has been collected through oral communication. Secondary data
about the company profile and other details were collected from the company website.
SAMPLING PROCEDURE:
Convenience sampling is adopted for survey. Respondents were selected at the
convenience of the researches and the structured questioner was used for collecting the

information.
SAMPLING SIZE:
Due to time and resource constraint the sample size has been taken as 100. In
convenience sampling is used for selection of homogeneous sample for the study. It refers to
selection a sample of study. It is a non-probability sampling. Thus research study may include
study objects, which are conveniently located. Research findings based on convenient sampling
however, cannot be generalized.

3.5 LIMITATIONS OF THE STUDY:
 The time constrain factor is prevails
 Ignore the facts of responds
 Particular area is cover
 Customers did not spare much time to answer the questions

CHAPTER - 4
DATA ANALYSIS
&
INTERPRETATIONS

4. DATA ANALYSIS AND INTERPRETATION
1) QUALITY OF OFFERS OFFERED BY AMARA RAJA TO ITS CUSTOMERS.
Table:
OPINION NUMBER OF RESPONDENTS PERCENTAGE
EXCELLENT 18 18
VERY GOOD 20 20
GOOD 50 50
SATISFACTORY 12 12
TOTAL 100 100
Graph:
QUALITY OFFERS
60
50
40
30
20
10
0
Excellence Very good Good Satisfactory
No of Respondents Percentage
INFERENCE:
From the above table12 % of the respondents are responded satisfactory 50 % of the
respondents are said that the quality of offers offered by the company are good 20% of the
respondents are said their opinion as very good and 18 % of the respondents are responded
as excellent towards the quality of offers.

2) THE FACTOR YOU CONSIDER DURING THE PURCHASING OF BATTERIES
Table:
TECHNOLOGY 00 00
PRICE 16 16
WARRANTY 28 28
BRAND NAME 22 22
LIFE 34 34
TOTAL 100 100
Graph:
Chart Title
40
30
20
10
0
Technology Price Warranty Brand name Life
INFERENCE:
From the above table 34 % of the total customers are saying that the required information
provided to them is Life, 22 % of them are saying Brand name, 28 % of them saying
warranty only 16 % of them price.

3) HOW LONG do AMARON BATTERIES WORK?
Table:
NEEDS IMPROVEMENT 00 00
0 -1 Years 10 10
1 -2Years 36 36
2 -3 Years 14 14
More than 3Years 40 40
TOTAL 100 100
Graph:
Chart Title
50
40
30
20
10
0
Needs Improvement 0-1 Year 1-2 Years 2-3 Years More than 3 Years
Mo of Respondents Percentage
INFERENCE:
From the above table 40% of the personnel saying that the competence of More than 3
years 14 %of the respondents are saying is 2 -3 years,36 %of them are saying 1 -2 years and
10%of them are saying 0 -1 year. Competence of dealing the personnel will help the customer
in better understanding of the products and to maintain customer relationship.

4) ARE YOU SATISFIED WITH THE QUALITY OF AMARON BATTERIES?
Table:
EXCELLENT 20 20
VERY GOOD 26 26
GOOD 34 34
SATISFACTORY 20 20
TOTAL 100 100
Graph:
Chart Title
40
30
20
10
0
Excellence Very good Good Satisfactory Needs
Improvement
INFERENCE:
From the above table20 % of respondents are saying excellent performance, 26% of
them are saying very good, 34 %of them are saying good and 20 %of them are saying satisfied
with the persuading the customer by the service provider people of the company.

5). ARE YOU SATISFIED WITH PROMOTIONAL ACTIVITIES OF AMARON?
Table:
EXCELLENT 26 26
VERY GOOD 42 42
GOOD 24 24
SATISFACTORY 08 08
TOTAL 100 100
Graph:
Chart Title
60
40
20
0
Excellence Very good No of Respondents
Good Percentage
Satisfactory Needs Improvement
INFERENCE:
From the above table Out of 100 %, 26% of the respondents are saying that the
promotional activities provided by the organization is excellent. 42% of them are saying very
well, 24% of them are saying well, 8% of them are satisfactory

6) WHAT ABOUT THE SERVICE?
Table:
EXCELLENT 24 24
VERY GOOD 28 28
GOOD 22 22
SATISFACTORY 18 18
TOTAL 100 100
Graph:
Chart Title
30
25
20
15
10
5
0
Excellent Very good Good Satisfactory Needs
Improvement
INFERENCE:
From the above table 24.% of them are responded Excellent, 28.% of them are
responded as very good , and 22% of them are responded as good, 18% of them are satisfied
with the 6% of them are told as needs improvement in the service.

7) Comparing AMARON to other Branded batteries
Table:
SATISFACTORY 04 04
AVAILABILITY 36 36
PRICE 20 20
SERVICE 40 40
TOTAL 100 100
Graph:
Chart Title
45
40
35
30
25
20
15
10
5
0
Excellent Very good Good Satisfactory Needs Improvement
INFERENCE:
From the above table 40% of the respondents are responded as service20% of the
respondents are responded as price, and 36% of them are responded as availability in meeting
the delivery requirement, 4% of them are responded as needs improvement in meeting the
delivery requirement.
8) BASED ON THESE SPECIFIC EXPERIENCES, I WILL USE AMARON BATTERY
AGAIN?
Table:
DIS-AGREE 00 00
NAUTRAL 16 16
AGREE 24 24
STRONGLY AGREE 60 60
TOTAL 100 100
Graph:
Chart Title
70
60
50
40
30
20
10
0
Improvement
INFERENCE:
From the above table 60% respondents are responded as strongly agree towards usage of
AMARON battery again. 24% of the respondents are responded as Agree and 16 % of the
respondents are responded as Neutral to usage of battery again.

9) BASED ON THESE SPECIFIC EXEPERIENCE, I WILL RECOMANDED AMARON
BATTERIS TO OTHERS?
Table:

00 00
DIS-AGREE 14 14
NAUTRAL 50 50
AGREE 26 26
STRONGLY AGREE
TOTAL 100 100
Graph
Chart Title
60
50
40
30
20
10
0
Needs Dis agree Nautral Agree Strongly agree
Improvement
INFERENCE:
From the above table 26% of respondents are saying that the Strongly Recommended
AMARON batteries to others. 50% of the respondents are said that, Agree to Recommended
AMARON batteries to others14 %e of them are as Neutral, and 10% of them are said as Dis -
Agree towards the recommendation.

10) DELIVERY PERFORMANCE COMPARED TO COMPETORS?
Table:
EXCELLENT 24 24
VERY GOOD 40 40
GOOD 08 08
SATISFACTORY 18 18
TOTAL 100 100
Graph:
Chart Title
50
40
30
20
10
0
improvement
INFERENCE
From the above table 24% of the respondents are responded as deliver performance is excellent
when compared to competition. 40% of the respondents are responded as very good, 8% of the
respondents are responded as good, 18 % of the respondents are responded as satisfactory, and
10% of the respondents are responded as needs improvement regarding the deliver performance.

11) PRODUCT LOOK & FEEL
Table:
EXCELLENT 34 34
VERY GOOD 44 44
GOOD 06 06
SATISFACTORY 16 16
TOTAL 100 100
Graph:
Chart Title
50
40
30
20
10
0
improvement
INFERENCE:
From the above table 16% of the respondents are responded as satisfactory towards the
product look and feel. 6 % of the respondents are said it is good, 44 % of the respondents are
said it is very good and 34 % of the respondents are said it is excellent regarding the product
look and feel.

12) RELIABILITY OF THE PRODUCT
Table:
EXCELLENT 14 14
VERY GOOD 40 40
GOOD 30 30
SATISFACTORY 16 16
TOTAL 100 100
Graph:
Chart Title
50
40
30
20
10
0
Excellent Very good Good Satisfactory Needs improvement
INFERENCE:
From the above table 14 % of the respondents are responded as excellent,40 % of the
respondents are responded as very good, 30% respondent are responded as good, and 16 % the
respondents are responded as satisfactory towards the reliability of the product.

13) PRODUCT- COMPETITION?
Table:
HIGH 58 58
MODARATE 36 36
LOW 06 06
TOTAL 100 100
Graph:
Chart Title
70
60
50
40
30
20
10
0
High Modarate Low
INFERENCE:
From the above table 58 % of the respondents are responded as high, 36% of the
respondents are responded as moderate and 6 % of the respondents are responded as low
towards the product competition (i.e regarding product look and feel, ease of
storage/handling/erection, product performance, and reliability of the product)

14)AFTER SALES SERVICE COMPARED TO COMPETITORS
Table:
EXCELLENT 30 30
VERY GOOD 40 40
GOOD 20 20
SATISFACTORY 10 10
TOTAL 100 100
Graph:
Chart Title
50
40
30
20
10
0
improvement
INFERENCE:
From the above table 30% of the respondents are responded as excellent, 40% of respondents
are responded as very good, 20% of the respondents are responded as good, and 10 % of
respondents are responded as satisfactory regarding after sales service compared Competition

CHAPTER – 5
FINDINGS
SUGGESTIONS
&
CONCLUSION

5.1. FINDINGS
 It is concluded that 50 percentages of resp0ondents are said the quality of
offers offered by the Amara raja are good.
 It is concluded that, 34 percentage of the respondents are responded as
excellent in providing the required information to the customers and 16
percentage respondents are just satisfied with the required information
provided to them.
 42 percentages of the respondents are well known about the quality of
engineering and commercial documents of the company.
 40 percentage the respondents are meeting the delivery requirement
 It is concluded that 60 percentage of the respondents says very good supply
without deviation
 It is concluded that 50 percentage of the respondents says that the quality of
packing is very good
 It is concluded that 44 percentage of the respondents says the product look and
feel are very good
 It is concluded that 40 percentage of the respondents are satisfied with the
product performance.
 It is concluded that 56 percentage of the respondents says that the competence
of service personnel is excellent

5.2. SUGGESTIONS
 The Company has to improve the quality of offers, offered to the customers
 The company has to provide the required information to the customers on time should be
improved.
 The quality of packaging should be improved to reduce the damages.
 The products needs improvement to satisfy the customers.

5.3. CONCLUSION
I would like to conclude that the AMARA RAJA BATTERIES LIMITED have to
improve the market in Tirupati. The customer’s satisfaction has been measured and it was found
maximum customers have excellent. Suggestions have been given to improve the performance
of the company, these suggestions will help the company to retain existing customers and
increase its customer’s base product.

QUESTIONNAIRE
ANNEXURE

ANNEXURE
AMARA RAJA BATTERIES
QUESTIONNAIRE
NAME: MOBILE NO:
ADDERES:
1) Quality of offers offered by Amara raja to its customers [ ]
a) Excellent b) very good
c) good d) satisfactory
2) The factor you consider during the purchase of battery? [ ]
a) Price b) life
c) Warranty d) brand name
e) Technology
3) From how long you using the “AMARON” battery? [ ]
a) 0 – 1 year b) 1 -2 year
c) 2 -3 year d) more than 3years
4) Are you satisfied with the quality of using batteries? [ ]
5) Are you satisfied with the promotional activities of AMARON? [ ]
a) highly satisfied b) moderately satisfied
c) satisfied d) dissatisfied
e) Highly dis-satisfied

6) How is service doing by the company? [ ]
a) Bad b) good c) very good d) excellent
7) Comparing AMARON to other brand batteries [ ]
a) Price >>> high low competitive
b) Availability>>> good average poor
c) Service>>> good average poor
8) Based on these specific experiences, I will use AMARON battery again? [ ]
a) strongly agree b) agree
c) neutral d) disagree
e) strongly disagree
9) Based on these specific experiences, I will recommended AMARON battery to others?
[ ]
a) Strongly agree b) agree
c) Neutral d) dis – agree
e) Strongly dis - agree
10) Analysis of deliver performance compared to competition [ ]
a) excellent b) very good c) good d) satisfactory
11) Analysis of product look & feel [ ]
12) Analysis of reliability of the product [ ]
a) High b) moderate c) low
13) Analysis of product- competition [ ]
a) High b) moderate c) low

14) Analysis of after sales service compared to competitors [ ]
15) Any suggestions
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________

BIBLIOGRAPHY

BIBLIOGRAPHY
BOOKS
● Kotler Philip, Marketing Management, Pearson Education Inc. 11 th Edition.
● Consumer Behavior – Building Marketing Strategy 9th Edition 2003, Tata McGraw
Hill
Website
www.amararaja.com

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Customer Satisfaction

ACHARYA INSTITUTE OF TECHNOLOGY Page 1

Customer satisfaction, a businessterm, is a measure of how products and services

In a competitive marketplace where businesses compete for customers, customer

WHAT IS CUSTOMER SATISFACTION?

“Satisfaction is the consumer's fulfillment response. It is a judgment that a product or

ACHARYA INSTITUTE OF TECHNOLOGY Page 2

MEANING OF CUSTOMER SATISFICATION

 MEASURING CUSTOMER SATISFACTION

ACHARYA INSTITUTE OF TECHNOLOGY Page 3

 Organizations are increasingly interested in retaining existing customers while

FACTORS OF CUSTOMER SATISFACTION

ACHARYA INSTITUTE OF TECHNOLOGY Page 4

In a competitive marketplace where businesses compete for customers, customer satisfaction

"Customer satisfaction"is the important statement of the problem in this project.

Measuring customer satisfaction

ACHARYA INSTITUTE OF TECHNOLOGY Page 5

1.2 INDUSTRY PROFILE

ACHARYA INSTITUTE OF TECHNOLOGY Page 6

Valuation & Recommendation

The major manufacturers in the Batteries industry (India) are:

ACHARYA INSTITUTE OF TECHNOLOGY Page 7

1.3 COMPANY PROFILE

Amara Raja Batteries limited is a member company in Amara Raja Group of

Board of Directors of ARBL

Dr. Upendranath Naimmlagadda NRI

Mr. P. Lakshman Rao Charted Accountant

Mr. Arthur F. Nening.Jr. Johnson Controls Inc. USA

Mr. Douglas C. Brown Johnson Controls Inc. USA

Mr. James T. Luke Johnson Controls Inc. USA

Mr. Jayadev Galla Managing Director

Industrial Batteries Division (IBD)

ACHARYA INSTITUTE OF TECHNOLOGY Page 8

ACHARYA INSTITUTE OF TECHNOLOGY Page 9

Amara Raja Batteries is extremely committed to its CSR(Corporate Social Responsibility)

ACHARYA INSTITUTE OF TECHNOLOGY Page 10

1.4 PRODUCT PROFILE

ACHARYA INSTITUTE OF TECHNOLOGY Page 11

Hi-way Truck Batteries

ACHARYA INSTITUTE OF TECHNOLOGY Page 12

PRO Hi-life Batteries

The new Amaron Shield, with an unheard of 24 months warranty. A product of

ACHARYA INSTITUTE OF TECHNOLOGY Page 13

PLANT PROFILE AND PHILOSOPHY

ACHARYA INSTITUTE OF TECHNOLOGY Page 14

Culture & Environment:

Benchmark pollution control measures, energy conservation measures, waste reduction

 "All Round Performance in Industrial Activity including Promotion/Expansion

ACHARYA INSTITUTE OF TECHNOLOGY Page 15

 "Industrial Economist Business Excellence Award" - 1999 - Award by the Industrial

 "Excellence Award" - by "Institute of Economic Studies (IES)", New Delhi on the

 "Udyog Rattan Award" - BY Institute of Economic Studies, New Delhi.

 "Excellence in Environment Management" - By Andhra Pradesh Pollution Control

ACHARYA INSTITUTE OF TECHNOLOGY Page 16

ACHARYA INSTITUTE OF TECHNOLOGY Page 17

Era of Liberalization and Globalization

ACHARYA INSTITUTE OF TECHNOLOGY Page 18

As defined by Philip Kilter, the term ‘Satisfaction’ refers to “a person’s feelings of

The switching option – is it an opportunity? Or threat?