1.

FACTOR ANALYSIS
To understand the various parameters affecting the perception of the mass towards TATA Nano, the respondents were interviewed with the help of questionnaire mentioned in the appendix having the variables found from the secondary data. Further analysis was done through factor analysis with the help of SPSS software. The goal of the factor analysis is to reduce the no. of original set of variables to a smaller set of comprehensive factors for use in subsequent multi-variant analysis. Therefore through the factor analysis the 13 variables that the perception of the mass can be reduced to lesser no. of comprehensive factors that can explain the other variables. This shall reduce the complexity. The output we get after compiling the input data is:

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. Bartlett's Test of Sphericity Approx. Chi-Square df Sig. .669 709.908 78 .000

From this table it can be interpreted that the value of KMO is greater than 0.5, which means that our research data is appropriate and valid. KMO value is greater than 0.5 because no. of respondents were more than 5 times the no. of the decision variables.

Table 2.2 Total Variance Explained

Component Total 3.808 2.095 1.772 1.272 .932 .904 .796 .546 .303 .239 .153 .122 .058 Initial Eigenvalues % of Cumulative Variance % 29.294 29.294 16.119 45.413 13.629 59.042 9.784 68.826 7.172 75.998 6.951 82.949 6.119 89.068 4.197 93.266 2.329 95.595 1.841 97.436 1.175 98.612 .941 99.553 .447 100.000 Rotation Sums of Squared Loadings % of Cumulative Total Variance % 3.780 29.076 29.076 2.095 16.115 45.191 1.769 13.608 58.799 1.304 10.027 68.826

1 2 3 4 5 6 7 8 9 10 11 12 13

Extraction Method: Principal Component Analysis.

Now from the above table of SPSS output the total no. of factors in which the variables can be classified can be realized. From the Eigen values of each factor in the table, the factors having Eigen value greater than 1, shall be considered for further analysis. As in this case the Eigen value of 4 factors is more than 1, so the no. of factors shall be 4. The percentage of variance column shows that the total variance explained by each factor. As in this case the 1st factor explains the total variance up to 29.294 %, similarly the entire factors explains the variable. Upto 68.826% of the variables are explained by the 4 factors. It means 31.174% are explained by other factors which have not been taken into account.

Table 2.3 Rotated Component Matrix(a)

Variables 1 BrandName Design Safety Afffordability Comfort Status Lifestyle Mantainence Inspace Accessories Power Powersteering Brakes .171 .952 .919 .882 -.055 -.022 -.010 .830 -.122 .021 .704 .130 -.025 2 .501 -.075 .047 .157 .927 .048 .898 .008 -.148 -.025 -.106 .147 .297 Component 3 -.065 -.011 -.040 -.083 .061 .924 .005 .049 -.140 .930 .090 .045 -.050 4 -.517 .003 -.171 -.231 .006 -.034 .133 -.011 .822 -.073 .273 .695 .442

Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. a) Rotation converged in 4 iterations.

From the above table of output we can identify the distribution of each variable in our selected factors. Our 4 factors are as follows -

Factor1

= Design (L value = .952) + Safety (L value = .919) + Affordability (L value = .882) +

Mantainence (L value = .830) + Power (L value = .704) shall be combined together to get our 1st major factor, we may name as . This factor is explaining 129.076 % of the variation.

Factor2 = Comfort (L value = .927)+ Lifestyle (L value = .898)

2nd major factor, we may name as variation.

shall be combined together to get the

. This factor is explaining 16.115 % of total

Factor3 = Status (L value = .924) + Accessories (L value = .930) shall be combined together to get the
3rd major factor, which we may name as variation. . This factor is explaining 13.608% of total

Factor4 = Interior Space (L value = .822). This factor is explaining 10.027% of total variation.

Design Comfort Safety

Factor 1

Affordability Mantainence Power

Factor 2
Lifestyle

Status

Factor 3
Accessories

Factor 4

Interior Space

CLUSTER ANALYSIS
Cluster Analysis is performed to assign the objects into groups (called clusters) so that objects from the same cluster are more similar to each other than objects from different clusters. Therefore in this research, the sample of 100 respondents can be classified into certain no. of groups or clusters showing the same attributes. This form of analysis will basically help the marketer to position their product in a much effective way by targeting a certain group of individuals. Therefore it is important for the research to find as to which cluster of people TATA Nano should be targeted. Here the grouping variables are age, sex, profession, monthly income, family members, awareness of TATA Nano, liking and plan to buy Nano. After running cluster analysis through SPSS software using the above mentioned grouping variables, following output was obtained:

Agglomerative hierarchical clustering

First step for clustering shall be Agglomerative hierarchical clustering which breaks up (divisive) a hierarchy of clusters. Therefore through hierarchical clustering an idea of the no. of clusters into which the sample should be classified can be obtained. This is done using Agglomeration Schedule mentioned in Appendix.

APPENDIX 2
Agglomeration Schedule
Cluster Combined Stage 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Cluster 1 97 27 71 25 72 46 20 56 16 30 30 26 2 22 45 78 81 35 Cluster 2 100 99 96 92 79 71 70 68 66 56 55 27 15 97 94 93 87 86 Coefficients .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 .000 1.000 1.000 1.000 1.000 1.000 Stage Cluster First Appears Cluster 1 0 0 0 0 0 0 0 0 0 0 10 0 0 0 0 0 0 0 Cluster 2 0 0 0 0 0 3 0 0 0 8 0 2 0 1 0 0 0 0 Next Stage 14 12 6 29 24 32 19 10 32 11 35 54 30 46 56 59 40 43

19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66

20 37 82 44 51 23 53 42 14 60 25 2 12 16 36 28 30 13 4 16 20 36 52 1 19 25 23 12 2 11 48 43 17 38 34 18 6 45 23 12 78 16 13 20 17 8 45 24

85 84 83 76 73 72 69 67 64 62 61 59 57 46 41 40 33 32 29 31 30 81 53 51 35 44 37 22 4 88 80 65 63 50 49 26 10 52 36 95 89 77 25 82 18 16 91 58

1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.400 1.400 1.500 1.500 1.500 1.500 1.833 1.833 1.833 1.833 2.000 2.000 2.000 2.000 2.000 2.000 2.000 2.000 2.167 2.200 2.400 2.500 2.500 2.500 2.625 2.750 2.857 3.000 3.000

7 0 0 0 0 0 0 0 0 0 4 13 0 9 0 0 11 0 0 32 19 33 0 0 0 29 24 31 30 0 0 0 0 0 0 0 0 15 45 46 16 38 36 39 51 0 56 0

0 0 0 0 0 5 0 0 0 0 0 0 0 6 0 0 0 0 0 0 35 17 25 23 18 22 20 14 37 0 0 0 0 0 0 12 0 41 40 0 0 0 44 21 54 60 0 0

39 45 62 44 42 45 41 80 79 70 44 47 46 38 40 78 39 61 47 60 62 57 56 72 78 61 57 58 71 68 67 68 63 87 67 63 89 65 69 70 73 64 74 69 74 71 82 81

67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99

34 11 20 12 2 1 47 13 1 12 3 19 14 11 7 13 2 13 12 12 38 9 2 3 12 2 7 3 1 7 3 1 1

48 43 23 60 8 75 78 17 74 20 5 28 98 42 24 45 11 47 34 19 39 14 6 54 13 9 38 21 2 12 7 3 90

3.000 3.000 3.156 3.167 3.200 3.333 3.667 3.762 4.500 4.901 5.000 5.167 5.500 5.500 5.500 5.603 6.064 6.408 6.870 7.684 8.000 8.000 8.263 8.500 8.992 9.595 9.778 10.667 10.832 13.791 14.300 15.586 30.899

53 48 62 58 47 42 0 61 72 70 0 43 27 68 0 74 71 82 76 85 52 0 83 77 86 89 81 90 75 93 94 95 98

49 50 57 28 64 0 59 63 0 69 0 34 0 26 66 65 80 73 67 78 0 79 55 0 84 88 87 0 92 91 96 97 0

85 80 76 76 83 75 84 82 95 85 90 86 88 83 93 84 89 91 86 91 93 92 92 94 96 95 96 97 98 97 98 99 0

From this agglomeration schedule it can be observed that the no. of clusters should be 2 or 3. The next step of classification of sample into clusters is done through K-means clustering.

K-means Clustering
After running the K-means clustering by entering the no. of clusters as 3, following output was
obtained:
Table 11.1 Final Cluster Centers Cluster 1 SEX AGE PROFESSION MONTHLYINCOME FAMILYMEMBERS AWARENESS LIKING PLANTOBUY 1.62 1.54 2.69 3.85 6.62 1.00 3.92 1.92 2 1.28 1.25 1.72 1.94 4.19 1.06 4.03 1.75 3 1.35 1.45 2.98 4.42 4.05 1.11 4.09 1.62

Table 11.2

CLUSTER 1:

This cluster includes 13 respondents. The major characteristics of this cluster are that most of them are females, the age group is between 18-50yrs, the major profession is Pvt. Sector employee and students, monthly income is above Rs. 20000, Avg. no. of family members are 6, all are aware of the TATAs Nano, they somewhat like TATAs Nano but they dont plan to buy it.

CLUSTER 2:

This cluster includes 32 respondents. The major characteristics of this cluster are that most of them are males, the age group is between 18-30yrs, the major profession is Pvt. Sector employee and govt. employee, average monthly income is around Rs. 10000-Rs.15000, Avg. no. of family members are 4, all are aware of the TATAs Nano, they somewhat like TATAs Nano but they dont plan to buy it.

CLUSTER 3:

This cluster includes 55 respondents. The major characteristics of this cluster are that most of them are males, the age group is between 18-30yrs, the major profession is Pvt. Sector employee and students, average monthly income is above Rs. 20000, Avg. no. of family members are 4, all are aware of the TATAs Nano, they somewhat like TATAs Nano but they have larger orientation towards buying TATA Nano. Therefore, TATA Nano should target cluster 3 due to higher intend to purchase, family members are 4 which are suitable for TATA Nano.