Topic 1

Demographics
Demographics are the characteristics of any population regarding with size, age, gender,
density, location, occupation, race and other statistic. Demographics are major interest of any
organization which is operating in many countries with several product lines. Population of
the world is increasing at an explosive rate, now it has exceeds to 7.1 billion people and will
grow up to 8.1 billion at the end of 2030. The top ten major contributor counters to this
growth are India, Pakistan, Bangladesh, Nigeria, Russia, Japan, United States, Indonesia,
Brazil and China. (http://www.internetworldstats.com/stats8.htm). A large and highly diverse
population poses both challenges and opportunities to big organizations which are operating
in many countries.
Changes in the world demographics environment have major implications for business. For
example, in Pakistan up to 40 % of the population are young people (14 years old) out of
whom 14% are 4 years old or younger. Large population with a 173 million young people
offers a great opportunity to businesses. E.g. In august 2000 by focusing on this situation
Proctor and Gamble introduced world famous product named as Pampers (disposable
pampers brand) in Pakistan. Dominant percentage of this population was using cloth nappies
at that time. Pampers brand was committed to baby care and development; it reached out to
mothers of new born babies through hospital education programs. Pampers also approached
to low income families, hard to reach areas through mobiles and they also educates the
Pakistani mothers about baby care. And outcome of all these programs was a dominant
market share as award for P&G. so as the good business person we have to analyse the target
market to offer competitive goods and services. This shows the importance of demographics
that plays a vital role before offering any product into the market.
Following below are the most important demographics characteristics of any population.

Age

Gender

Density

Location

Occupation

Race

Topic 2
Beverages
Liquid consumption, conspicuously water, is necessary for good health. Water is a major
component which plays an important role in almost all body functions and water is also a key
element of every tissue, organ and cell (Kleiner, 1999). Whereas some water derives from
food, massive amount of it comes from beverages, either one as pure water or it can also be a
part of any beverage for instance, soft drinks, fruit juices, beer, milk, coffee and tea. Liquid
refreshments (beverages) are also significant factor of nutrition. It subsidize to vigorous
eating by facilitating to come across Food Guide endorsements for usage of vegetables, fruits
and dairy products. On the other hand beverages, particularly soft drinks which are rich in
added sugar can charge over recommended level of calories. In 1996 Nielsen S, Siega A and
Popkin B conducted a study that ~50% of the increase in daily caloric is coming from
consumption of calorically sweetened beverages, such as soda. In addition, beverages are also
liable for additional consumption of alcohol and caffeine, colorings, preservations and other
ingredients (Catalogue H164-38/1-2007E) Ottawa: Health Canada, 2007).
Drinks which usually known as soft drinks are Coke,Soda, Fizzy drinks, Minerals, Tonic,
Sparkling water, Seltzer or Carbonated drinks, beverages that normally contains water,
flavoring agent and sweetener. Sweetener might be fruit juice, high fructose corn syrup, sugar
or sugar substitutes (in diet drinks case). Soft drinks are known as soft because it contains
small amount less than 0.5 % of alcohol in contrast of hard drinks (alcoholic beverages).
Tea fruit juices and some other nonalcoholic drinks are technically soft drinks according to
this definition but usually not referred to as such.
Types of beverage
(A Comparative Study on Consumption Patterns of Soft Drinks and Fruit Juices article)

Alcoholic beverages

Hot beverage

Soft drinks

Non-Alcohol beverages

Fruit juice

Other (soup and yogurt)

Topic 3
Literature Review:
Brand preference
In the 1960 The American Marketing Association (AMA) defined as is a name, term, sign,
symbol, or design, or a combination of them, intended to identify the goods and services of
one seller or group of sellers and differentiate them from those of competitors. (Keller,
1998:2)
For consumers, when deciding between brands which are in the marketplace will include
brands as an element to determine the qualities of the product rather than employing their
time to enhance their knowledge of the product in information searching activities. Therefore,
consumers use brands as cues to make decisions to purchase or try products (Ger et al.,
1993).
Different studies has been conducted to understand the consumers preferences and found that
today demand of a brand is depend on consumers past experiences. (Murphy and Becker
1988) willing ness to pay might be the function of usage which could directly relate to
expected utility, through switching costs, or through beliefs about quality. Childhood
experiences can also play a vibrant share to determine brand preferences (Sirgy 1997).
According to these set of assumptions, accumulated stock of consumers preferences may be
an asset for inescapable firms and a source of long-term survive. In 1956 Bain found that the
benefit to develop sellers ensuing from preference of consumer for their products as opposed
to potential entrant goods as on average larger and more frequent in occurrence at the large
values than other barrier to entry (p. 216).
Brand preferences are used to measure the brand loyalty, when a customer selects a particular
brand in presence of certain competing brands but if that brand is not available in market only
then will accept substitutes. The degree to which customer prefer to buy one brand over
another is developed through strong and clear understanding value expectations. Availability
and equality of price are assumption used to measure the brand preferences, consumer has
more choices and high expectations than ever, to build loyal customers brands has to deliver
more than expectation by offering them value added goods and services.
Many studies of adoption have been used to elaborate that how consumers made preferences
for services and products (Klein AND Tornasky, 1982; Rogers, 1995; Charlotte, 1999;
Mason, 1990). In general, those theories put emphasis on the significance of product features,
risk, vanished, relative advantage, social approval, triability.

Murphy and Becker, 1988 found that brand preference might be a function of past experience
that can directly relate to expected utility, (Klemperer, 1987) through switching cost or views
about quality. It could depend on past exposure to advertising (Schmalensee, 1983,
Doraszelski and Mankovich 2007), or past observations of the behaviour of others as in
Ellison and Fundenberg (1995). At the extreme, brand preference could be entirely
determined by experience in childhood (Berkman, Lindquist and Sirgy, 1997). All have
tremendous impact on the position of our brand in the consumers preference set, but the
relative importance of each factor depends on the nature of industry under consideration,
location and social characteristics of the consumer of different brands.
There are at least three classes of methodologies to measure brand preference directly. Survey
questions, brand choice measure, and constant sum measure. Our study of brand preference in
the beer category adopted the survey question measurement of brand preference.
Brand preference in soft drinks sector:
William R. George conducted a study in (1999) and unfolds the responsible factors
for brand preferences of beverage industry. When alternatives are functionally similar
Consumer appear with high willingness to pay for some certain brands. (Dekimpe et al. 1997)
majority of the buyers particularly purchase a single brand of cola, beer or margarine in
prescience of several brands with similar prices, only just because of perceived taste. A huge
number of consumers buy branded medications when there are chemically equivalent
substitutes are accessible at the same market for much lower prices. (Kyle, Berndt, and Ling
2002).consumers are willing to pay more for homogenous items like CDs and books from
branded online stores (Brynjolfsson and Smith 2001)
This brand preference is influenced by various factors. In the identification of factors
affecting the brand preference, it was concluded that Brand persona is the most effective
factor that affects the brand preference. This Brand persona deals with the personality aspects
or the external attributes of brand, thus it can be said that consumer prefer any brand by
looking at the external attributes of a brand.
Factors that can effect brand preferences

Taste or health
Consumer awareness
consumption pattern of soft drink product
Reference Group Influence
Situational Variation of the Consumer

Friends and family

Social status
Price
Country of origin
Quality