THE IMPACT OF MARKETING COMMUNICATION ON CUSTOMER'S LOYALTY TO CONSUMERS PRODUCT (A CASE STUDY OF CADBURY NIGERIA PLC)


Content

ABSTRACT

This research work is basically carried out to critically and objectively examine the significant and in negligible role played by "Marketing Communications on consumer loyalty to consumer products".

 

This study further reveals the identical, relationship between Marketing Communications with terms as used therein, such as - Marketing. Mix (Those combination of the four (4Ps) inputs that constitute the core of a company's marketing system, that is - product, price, place and promotion); Consumer Products, Social Marketing and Consumerism, with more emphasis on consumer products manufacturing giant, CADBURY NIGERIA PLC.

 

Moreso, this research is carried out though the traditional primary and secondary sources of data respectively and it reveals how the company (Cadbury, in this case), in comparison to other competitors, has been able to explore and implement the a concept of Integrated Marketing Communications (IMC) in achieving its marketing goals of increase products patronage, brand loyalty, customers' acquisition and retention, in a highly competitive consumer market.

 

However, the research has limited the exercise to the following:

(i)        A random sample of consumers in Lagos and other accessible

areas.

(ii)       Four major product mix (Bounrvita, TomTom, Knorr and Chocolate) of Cadbury are being considered.

(iii)      The study is intended to examine the performance of marketing communications to overall objectives of Cadbury.

(iv)      The roles played by various communication tools., on consumers' patronage of Cadbury products.

(v)       Examining the raison d'etre for consumers' tastes and preferences.

 

 

 

TABLE OF CONTENTS

                                                                                                                              Pages

Title Page                                                                                                                  i          

Certification                                                                                                             ii

Dedication                                                                                                                iii

Acknowledgment                                                                                                   iv

Abstract                                                                                                                    v

Table of Contents                                                                                                   vi

 

CHAPTER ONE: INTRODUCTION

1.1            Background of the Study                                                                         1

1.2            Statement of Problem                                                                              5

1.3            Objective of the Study                                                                              7

1.4      Research Questions                                                                                   8

1.5      Statement of Hypotheses                                                                        9

1.6      Significance of the Study                                                                         10

1.7      Scope and Limitation of the Study                                                        11

1.8      Definition of Terms                                                                                    13

 

CHAPTER TWO: LITERATURE REVIEW  

2.1            Introduction                                                                                                            16

2.2            Review of Related Literature                                                                  16

2.2.1    Marketing in Relation to Communications                                         17

2.2.2    Marketing Communications Defined                                                   19

2.3            A view of the Communications Process                                               23

2.4            Developing Effective Communications                                                            26

2.5            Components of Marketing Communications                                     46

2.5.1    Advertising                                                                                                   46

2.5.2    Sales Promotion                                                                                         47

2.5.3    Publicity                                                                                                        48

2.5.4    Public Relations                                                                                          49

2.5.5    Packaging                                                                                                     50

2.5.6    Direct Marketing                                                                                        50

2.5.7    Event Marketing                                                                                         51

2.5.8    Personal Selling                                                                                          52

2.5.9    Other Promotional Tools                                                                         53

2.6            Understanding Consumer Behaviour                                                   56

2.6.1    Consumer Buying Motives                                                                      57

2.6.2    Consumer Buying Decision Process                                                      61

2.6.3    Types of Consumer Buying Behaviour                                                 63

2.6.4    Consumer Evolution and Transformation                                           64

2.7            Summary of Literature Review                                                              65

 

CHAPTER THREE: RESEARCH METHODOLOGY

3.1            Introduction                                                                                                            68

3.2            Location of the Study                                                                                68

3.3            Research Data and Design                                                                       71

3.4            Research Instruments                                                                               72

3.5            Data Collection Procedures                                                                     73

3.6            Questionnaires Assumption & Design                                                  75

 

CHAPTER FOUR: PRESENTATION AND TREATMENT OF DATA

4.1            Introduction                                                                                                            76

4.2            Presentations and Treatment of Data                                                  76

4.3            Analysis of Data                                                                                          77

4.4            Testing of Hypotheses                                                                              79

4.5            Interpretation of Results                                                                          82

 

CHAPTER FIVE: SUMMARY OF RESEARCH STUDY

5.1            Introduction                                                                                                            86

5.2            Summary of Findings                                                                                86

5.3            Recommendations                                                                                     88

5.4            Conclusion                                                                                                   90

Bibliography                                                                                                            92

Questionnaire                                                                                                         94

 

 

 

 

CHAPTER ONE

INTRODUCTION

1.1      BACKGROUND TO THE STUDY

This chapter will examine the basic background to the study and its objectives will involve analyzing the historical and analytical perspectives of Marketing Communications on consumer loyalty to consumer products in the consumer segment of the market with proportionate emphasis on Cadbury Nigeria Plc.

 

The chapter will also include statement of problem, which will give rise to fundamental questions that will be answered in the context of the study.

 

Purpose of this study will be analyzed in order to bridge communication' gap between the reader and the writer of the project (researcher).

 

The scope and limitation of the study will be reviewed. The essence of this is to provide the audience with information about areas that this researcher has considered for the collection of data. This is because it is obvious the study cannot cover all geographic areas inherently concerned with the study. Limitation of course, will also be given consideration particularly as it affect this research.

 

The fact that the combo of marketing communications and the attendant consumer behavioural process breeds a complex study also indicates numerous problem that may hinder our research efforts into its indepth development and applications.

 

The world communication 'is derived from the Latin word – “COMMUNIS” meaning "Common". Thus when you communicate, you are trying to establish a commonness with someone. Through the use of verbal or non­verbal symbols; you, as the source, send a message through a channel, to receiver, in an effort to share an idea, attitude .attitude or, some other kinds of information.

 

As universally acknowledged, communication is an all-embracing discipline; it permeates all walks of life, and it is the life-blood of all organizations' activities. It is an integral part of marketing management, which makes marketing itself to be referred to as communication.

 

Marketing communication is, therefore, employed as a promotional tool in the consumer market just like in other types of businesses for attaining the set goals and objectives of corporate bodies and individuals and even, the government at all levels.

 

Modern marketing calls for more than developing a good product, pricing it attractively and making it accessible to the target consumer s. companies must also communicate with their present and potential customers, retailers, suppliers, other stakeholders and the general public. Every company is inevitably cast into the role of communicator and promoter, all promoters, all rolled into one. It is observed that, for most companies; Cadbury Nigerian plc inclusive, the question has always been not whether to communicate but rather -- what to say to whom and how often.

 

Basically, the term "Marketing" goes beyond selling or invitation to buy but it rather involves fundamental functions of identifying, anticipating and satisfying the need of the consumer. Once, it is described as a complex system rightly envisaged and catered for, even before production take place. It is off-shot of a larger marketing system that determines what to produce, when to produce it, how to produce it and for whom to produce for, leading to the study of consumer behaviour in attempt to discover his motives, willingness and ability to buy a product.

 

According to Foxall, "the marketing communication mix, otherwise known as promotional mix, is that complex of techniques under the control of management which may be used to communicate directly with buyer and potential buyer".

 

It is however, notably observed that the production in itself ,is not yet completed until it transform through all processes till it ultimately reach the final consumer who uses or consumes the product to quench his desire and satisfy his wants, either in the industrial or consumer market.

 

In a nutshell, the itinerary of marketing involves production of goods, good distribution, selling of the goods, satisfying the need of demands and getting feedback (information) about the strength and weakness of the product and the company in the market. Then marketing would have been completed.

 

Thus, Ames B. C. in his book (Pay-off from Product Management) defined product "as the essential vehicle for the provision of consumer satisfaction offered by a company in the market place." The Nigerian economic environment has undergone some fundamental structural changes. in, the recent years, which led to intermittent changes and instability, in the market. The apparent implication of such changes is the distortion of economic life of Nigerians. It elongates poverty and diseases, which lead to reduction in standard of living of the people. It creates low or better still, no purchasing power due to weak naira. It leads to low capacity utilization of the manufacturing sector thus low per capita income for household and industries. It also intensified inflation rate to high level and created room for smuggling, corruption and other anti-economy vices while ensuring steady rise in the rate of unemployment.

 

Amidst all these changes is - the obvious adverse effects inflicted on the marketing environment to the detriment of the manufactures . and particularly, the marketers. This is because, marketers have to contend with these obstacles day-in, day-out and it becomes necessary to fashion ways out of the doldrums in order to meet their set targets and break even, by making goods and services available to consumers and at the same time, aim to shoot up the sales turnover and profit of their respective companies.

 

As a result, those elements of the marketing mix which had to this time been relegated to the background, came into limelight to form the mix of corporate marketing operations in planning, implementation and controlling, all in the efforts to analyze the trends in the market and strategize to break­even by winning a fair share of total market competitions.

 

For a product, a marketer is faced with the task of creating a favourable disposition, thus, in the course of his attempt of persuasion, the marketer is compelled to seek for-confirmation of the existing attitude of consumers; change the new attitude to give him that edge. This, of course, is the main persuasive strategy a seasoned marketer would employ to pull through in a competitive marketing environment. Essentially, the challenges of changes are better handle through effective deployment of marketing communications strategies.

As every consumer is aware especially those in Urban areas, there are confusing arrays of integrated marketing communication campaigns, with each trying to out do other in an effort to win consumers patronage and

loyalty to their competing brands, they resulted to the use of promotional tools such a - Advertising, Personal Selling Direct Marketing, Public Relations, Sales Promotion etc.

 

Also, the enthronement of consumer sovereignty and concept, of consumerism places the manufactures at the behest of, consumers. Which lend credence to the scrambling of these manufactures to intimate their various brands with consumers through vigorous use of aggressive marketing communication tools.

 

 

1.2      STATEMENT OF PROBLEMS

The structural changes that affected the economic 'landscape of Nigeria, as discussed earlier, heralded the intense employment of tools of marketing communications by manufactures of consumer products.

 

Since the main task of marketing in mobilizing the resources of the organization towards improving the well-being of the society through the delivery of standard of living to the economy.

 

In producing any from of goods or services, the producer must of necessity have the consuming public in mind. Marketing has in it roots, the customer which is the reason for the business.

 

The multiple adverse effects of economic changes warrants the manufacturers to find solution to low demand of their products prices; the restraints on purchasing power of consumers caused by inflation and weak currency and influx of foreign competitive and substitute goods to the market.

 

A suave marketer will seek to study and understand the emotions and instincts-induced behavioural processes of consumers to determine their needs and preferences in order to satisfy those needs. The business philosophy that focuses on the customer and, brings all the organization's resources and skills to bear on the task of understanding and meeting customer needs is integrated marketing communications.

 

And because marketing environment is the one that is ever dynamic,, tastes and preferences of these so-called consumers changes with time. Then,

manufacturers and faced with problems of creating awareness and knowledge-based information about their products to consumers.

 

To stay in touch with consumer's changing needs and ensuring the company's ability to deliver those needs with new product lines and suitable marketing synergies. It is with this notion that the organization crowns the customer as the "king". This philosophy, recognizes that the objectives of a company bother on-customer satisfaction, goods availability 'in a profitable volume, planned through integrated marketing concept and executed in a socially responsible manner.

 

The use of marketing communications becomes imperative in the operations of a company, when he plan to launch and, or re-launch its products. These tools are also employed by company to correct some wring impressions about its products or the company's reputation in public perceptions.

In recent times, Procter and Gamble, a consumer products manufacturing giant, tried to inform the public about the erroneous impression create about one of its. brands - ALWAYS SANITARY PAD. And when NESTLE, another consumer drinks giants was battling to save and protect its reputation over news rave on expired skimmed milk brouhaha with Nigeria authority, the usefulness and essence of marketing communications strategies prevailed.

 

The intrinsic constant factor in production, in the name of Product-Life, ­Cycle (PLC), only make the functions of integrated marketing communications more inevitable. This is necessary as a result of each and different stage of production need specific and suitable marketing approach in communicating about the product to the consumers.

It could be deduced from the analysis above that manufacturers of consumer products, are indeed have to contend with either business extinction or business survival by breaking even mainly through, effective and aggressive use of integrated marketing communications strategy.

 

 

1.3      OBJECTIVES OF STUDY

This study is designed and arranged to focus on the achievement of two major objectives:

i.          The fundamental principle of consumer behavioural processes and the all-important consumer market; and

ii.         The essentiality of the concept of integrated marketing communications as a veritable tool of linking the consumer, to his varying . demands in the established consumer market.        

 

The intertwined role of marketing communications concept and the principle of consumer behaviour in the marketing system cannot be underestimated. This is obvious, a certain character as human being will always have the reasons to desire some wants for his basic living that will create demand for those needs based on his preference or taste and purchasing power. These consumers' needs will form the basis of what the manufacturing company will produce, supply and make available to this consumer at appropriate time in order to create satisfaction for the consumer.

 

Hence, the intermediary function of determining the needs of the consumers, how he will buy, when he will buy, what he buys, and even what induces his motives to buy, at one end, and the understanding the usefulness of these needs to the consumers by the manufacturers; of how he intends to supply these needs, how to convince his target audience, what will distinguish his products from others and how to make consumer sensitive to his valued pleas and assure them of protecting their interests, at the other end. All these aforementioned task necessarily becomes the 'onerous responsibility of marketing communications.

 

The bottom line of which is, marketing communications performing the dual role of:

a.     Informing, persuading and influencing the consumer decisions for the benefits of manufacturers, and

b.     Interpreting the responses of consumers as cognitive (creating attention), affective (affecting responses) and behavioural (effecting decision).

 

Also, the purpose of this study, is to test the viability of the concept of integrated marketing communications as applicable to CADBURY NIGERIA PLC, in improving her share of the competitive consumer market.

 

Amongst other objectives is to examine the significant roles of other variable factors that aided the effectiveness of marketing communications and to suggest solutions to its defects.

 

 

1.4      RESEARCH QUESTIONS

sequel to series of problem raised by this study and in order to accomplish the objective of this research, the study attempts to find appropriate solutions to the problems identified. The following research questions are therefore put to empirical finding in the study:

 

1.        What is the role of marketing communications in a business?

2.        How does promotional mix influence consumers buying motives and their buying decision process?

3.        What are the marketing communications strategies of the subject or research-Cadbury?

4.        How has the company effectively implemented and control the marketing communications strategies employed?

5.        Does marketing communications really impacted on the consumer patronage and lead to increased production volume?

6.        Does marketing communications contribute to the sales turnover and profit margin of Cadbury? .

7.        Will and do consumers switch over to other brands in absence, of these marketing communications?

8.        Does any relationship exist between a depressed economy and resurgence of marketing communications?

9.        Can marketing communications strategy enhance the public image of a company?

10.      Won't marketing communications appropriations lead to increased expenditure and decreased revenue to the company?

 

1.5      STATEMENT OF HYPOTHESES

Considering the nature of this research, two major hypotheses will be drawn and put to test in the study using Null hypothesis and Alternate hypothesis.

 

Ho:     The use of marketing communications influence the loyalty of   consumers to company's products.

Hi:       Consumer loyalty, to company's products is not influenced by the use of marketing communications.

Ho:      Marketing communications improves the public image of the company thus, patronage of its products.

Hi:       Marketing communications strategies can neither improve the public image of the company nor induce patronage of its products.

 

 

1.6      SIGNIFICANCE OF THE STUDY

This study is significant is several perspectives.

Firstly, it presents the analytical perspective of this unique segment of marketing and thus, serves as materials for future reference.

 

It becomes so significant because it energizes the quest to further develop this area as a result of overriding importance of communication in a dynamic environment, which marketing entails.

It expose not only how to reach the consumers but also, how best their satisfaction can be ensured.

 

The changing face of marketing system from previous and outdated mass marketing; selling highly standardized products to masses of customers at invaluable high costs, has moved to purposeful and obtainable fragmented market which necessitated the development of focused marketing programmes designed to build closer relationships with consumers in more narrowly defined micro-markets.

 

Informing, persuading and influencing the consumer decisions for the benefits of manufacturers, and Interpreting the responses of consumers as cognitive (creating attention), affective (affecting 'responses) and behavioural (effecting decisions).

 

This study becomes more significant in exploring the emerged prospects of w communications avenues for reaching even target consumer segments with more tailored message being made possible by vast improvements in computer information technology.

 

The ever present need for consumers to be adequately informed, the increase competition of consumer products, the ranging distance between manufacturers of consumer product and vast scattered consumers in near and remote geographical locations, also point out the significance of this study.

 

Again, the manufacturer recognized the need to expand the horizon of his potential and actual share of the consumer market that will yield high sales turnover and fulfill his capitalist motive of increasing profit base. The concept of marketing communications is most' important in this respect.

 

How well has consumers been informed and satisfied, and how far has the company responds to the needs of the consumer and yearnings of the larger society? These are questions that made this study very significant in unraveling the solution to these problems.

 

 

1.7      SCOPE AND LIMITATION OF STUDY

The study intends to appraise the ' compelling role of marketing communication in enhancing consumer loyalty to consumer products of a manufacturer.

 

However, has it always been found with majority of previous studies, this study is not exempted from certain limitations that hindered the desire of the researcher to present a through position in this area of marketing system, which had hitherto been. merely-treated and almost neglected by many authors.

 

scope of this study is to further investigate through practical research approach, the development of marketing communications, its objectives, the components of, communications system, the various role of marketing communications, the evaluation of the effectiveness and performance of marketing communications against the set objectives for obtaining the loyalty of target consumers to specific products in the consumer markets.

 

But due to time constraints, financial incapacitation, non-availability of material resources among other limitations, it becomes impracticable to extend the research to every inherent part of the country. As a result, the study will be limited to Lagos metropolis and other remote areas, accepted to be a cosmopolitan city with highest population density nationwide that will be representative enough to the required sample and data collection method.

 

Other limitations to the study include:

a.                 Non-availability of several research works in this specific area to provide a background and serve as references to this study.

b.                 Inability of the researcher to obtain accurate response from the respondents due to their lack of in-depth knowledge about the topic of research.

c.                  The subject of this research will focus only on the competitive consumer market with great emphasis on a leading consumer products manufacturer – CADBURY.

d.                 As we are aware of complexities of consumer market, this research will only examine the effects of marketing communication on few selected brands.

 

Despite all these obstacles, efforts shall be made to present adequate and well articulate position by exploring to the extreme, the basic data available to ensure the study serve as a basis for future source of information.

 

 

1.8      DEFINITION OF "SALIENT" TERMS AS USED IN THE STUDY

They key ‘unfamiliar’ terms used in the context of this study shall be defined, in order to enable the reader understand the report of the research more clearly. Those terms are as defined below:

 

§  Advertising: This is any paid form of non-personal presentation and promotion of ideas, goods or services by an identified sponsor.

§  Consumer Goods: All product which are "destined for use by ultimate consumers or households and is such form that they can be used without further processing".

 

§  Consumer Behaviour: This is a study of understanding the characteristics of those class of people who must of necessity desired maximum satisfaction from commodities purchased to meet their needs.

 

§  Direct Marketing: This is marketing achieved through various advertising medial that interact directly with consumers, generally calling for the consumers to make a direct response.

 

§  Industrial Goods: All products which are "destined to be sold primarily for use in producing other goods or rendering services as contrasted with goods destined to be sold primarily to the ultimate consumer.

 

§  Integrated Marketing Communications Concept (IMC): This is a concept under which a company strategically integrates and coordinates its many communications channel, to deliver a clear, consistent and compelling message about the organization and its products to , the consumers.

 

§  Marketing Database: It is an organized set of data about individual customers or prospects that can be used to generate and qualify customer leads, sell products and services and maintain customer relationship.

 

§  Non-Personal Communication Channels: These are media carrying messages without personal contact of feedback including major media, atmospheres and events.

§  Personal Communication Channels: These are channels through which two or more people communicate directly with each other including face to face, 'person to audience, over the telephone, or through the mail.

 

§  Packaging: This is the general group of activities in product planning that involve designing and producing the container or wrapper for a product to serve the purpose of serve the purpose of protection, convenience, economy and promotional functions.

 

§  Personal Selling: Personal presentation by a firm sales force, for the purpose of making sales and building customer relationships.

 

§  Promotion Mix: It is the specific mix of communications tools a company uses to pursue its marketing objectives.

 

§  Product Line Depth: This consists of product item intended for essentially similar uses, and possessing reasonably similar physical characteristic.

 

§  Product Mix: This is the full list of all products offered for sale by the company consisting of the entire range of products marketed by the company. It consists of all product lines are item that a particular company offered for sale in the market place.

 

§  Publicity: Publicity is a form of non-personal demand stimulation for an idea, a product-goods or services by embarking on media-over (news worthy) and commercially significant activities to obtain favourable presentation.

 

§  Public Relation: It is the deliberate plan and sustained efforts of an organization to establish and maintain mutual understanding between it and its various publics by building up a good `corporate image' and handling 'off unfavourable rumours and events.

 

§  Sales Promotion: There are short-term incentives provided to stimulate purchase or sale of a product or service.

 

§  Telemarketing: This is art of using telephone to sell directly to consumers.

 

 

 

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