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Measurements and Market Research

by Aparna Ravikumar

Our everyday lives revolve around the consumption of goods. From the relatively trivial ones, like toothpaste, soaps and shampoo, to the more important goods like water, power and food grains.

The production and sales processes of FMCG are thoroughly exhaustive-in terms of manufacturing the product and performing market research. These production and sales processes can be broadly grouped into different baskets-input, output and outcome.

The entire cycle of manufacture can be grouped into the input basket. For example, in the manufacture of toothpaste, the different ingredients, like carbonate salts that go into creating the toothpaste fall under the input category. The manufacturer also incorporates several other features into the toothpaste, like fresh taste, to maximize consumer satisfaction.

On the output side, the manufacturer uses market research to gauge the response of his user. Randomized surveys will tell the manufacturer the levels of satisfaction that his consumers experience. The outcome basket categorizes the scientific testing methods and procedures that the product is subjected to. These processes are used to answer questions regarding the harmful effects, if any, of the toothpaste on the user’s health, the toothpaste’s ability to fight of germs, etc. It provides solid, evidence-based proof of the toothpaste’s real performance as against its claims.

A relatively trivial product like toothpaste requires exhaustive steps to ensure consumer satisfaction, so it is safe to assume that a vital good like water supply will require the same measurement techniques to ensure safe and efficient water supply to all citizens.

On the input side, the sources of water, water quality,  presence of stray sewerage elements among various other indicators are measured and the impurities are suitably filtered out before the water enters the supply lines.

On the output side, the quality, in terms of the water’s colour, smell, taste, and quantity, measured using water bills or sump sizes, are used as major yardsticks of measurement. Other indicators can also be used to understand consumer satisfaction- the delay in supply, affordability, ease of setting up new connection, etc.

As an attempt to gauge market performance of public utilities, the citizen report card was introduced by the Public Affairs Centre (PAC). The CRC was first introduced in Bangalore and is now being adopted in different cities of the world. The CRC attempts to understand the consumer’s satisfaction, suggestions and complaints regarding the public utilities extended by the city’s corporation. Using randomized sample survey techniques, households are surveyed to gather data on consumer levels of satisfaction, with the quantity and quality of supply of public utilities, like power and water being specifically measured. The findings from the CRCs are shared at the local level to create awareness and increase citizen participation in the sphere of local governance.  They are also shared with governmental agencies, giving the agencies a clear picture of their performance.

On the outcome side, scientific tests performed on water from different sources give a clear evidence-backed picture of the quality of water being consumed by the people.

The input, output and outcome model provides the service provider or the product manufacturer with a clear picture of his performance in the market, giving him opportunities for improvement, which will, in turn, account for improvement in consumer satisfaction levels.

The concepts of measurement and market research were covered by Pavan Srinath in the B.CLIP classroom sessions.