Academic journal article Journal of the International Academy for Case Studies

Shodh-Market Research for Economy Housing

Academic journal article Journal of the International Academy for Case Studies

Shodh-Market Research for Economy Housing

Article excerpt

CASE DESCRIPTION

Market Research is the main topic on which case is written. The sub-topics covered in the case are Concept testing, demand estimation, conjoint analysis, product offering, Segmenting and targeting end consumers for better positioning

CASE SYNOPSIS

The client OBL wanted to launch an economy housing project in 10 cities across South India took help of market research company Shodh. OBL had completed several mid-range housing projects involving apartments in the price class INR 2.5 million to INR 7.5 million. The client appointed Shodh to understand about the market potential and consumer preferences in the economy segment. The company therefore decided to obtain a deeper understanding of the market in a large, metropolitan city like Bengaluru in India. It took services of market research company Shodh to assess the market size, consumer requirements and consumer preferences in the economy segment in Bengaluru, India. To address OBL's information needs, Shodh conducted market and consumer research studies during March-May 2015 using secondary data analysis, focus groups, expert interviews, field surveys and conjoint analysis. Since OBL wanted a presentation on the project by early-July, Vaseem had to analyse the data, prepare the demand forecasts, define the consumer segment profiles and describe the consumer preferences based on conjoint analysis and draw out the implications for the client's marketing strategy.

On a rainy day in June 2015, Vaseem, MD of Shodh, started working on case B of economy housing after validating results of case a on economy housing for Oriental builders Ltd. (OBL). Shodh is a Bengaluru, India, based market research agency which began analysing data for second part of a market research project that he carried out for a client named Oriental Builders Ltd (OBL).

BACKGROUND

In the years, 2007-2008 the world saw financial calamity due to the collapse of real estate markets in Western countries. Despite this world phenomenon, India was not affected by Global financial meltdown and in contrast, India provided opportunities for builders in a growing housing market. In India, the demand for residential units had grown significantly since 2001, which was a result of increasing urbanization, rising consumer expectations and easier availability of housing finance. The growth had been particularly sharp in cities like Bengaluru, India, which emerged as centre of information technology and business process outsourcing. During this boom period, developers focused on building spacious, large apartments with premium amenities priced from INR 2.5 million to INR 10 million and above. The 2008--worldwide economic crisis had not affected India as badly as it had affected some other countries in the region, nevertheless, tight liquidity and depressed sentiments, impacted housing purchases in India and the housing market in the major Indian cities had witnessed a downturn from 2009 (Gujarati & Dawn, 2010). In the year 2011, 44000 housing units were available in Bengaluru, India, against a demand of 20,600 units. This resulted in severe oversupply and created a huge marketing problem for the housing industry (Lilien, Philip & Moorthy, 2003).

In response to the downturn in the sales of premium and mid-range apartments, developers took some steps to make apartments more affordable. Instead of developing downtown and city centre areas where land was very expensive, developers started focusing on suburban areas with good connectivity to the city centre. In Bengaluru, India, such suburbs included areas like Bannerghatta Road, Whitefield, Electronic City, Doddaballapur, Hoskote, Kanakapura Road, Sarjapura Road and Yelahanka. Developers started designing apartments of smaller sizes, with basic amenities rather than premium features in order to bring down the prices. Developers also started examining opportunities in economy segment with apartments in the price class of below INR 2. …

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