ABSTRACT
In most economy, the notion of
scarcity and choices among resources tend to guide the order of business
not to talk of the unexpected economic and financial crisis which hit
even the most advance of economic like that of Europe and America
thereby making it pertinent for firms to strategically allocate their
resources to those markets that can still enhance their profitability
objectives and goals regardless of economic events especially that of
growing or medium scale business.
Chapter one of this research studies tends to unveil the historical
background of the concept of market segmentation and targeting as
strategies that have adopted way back in time as well and provide the
direction or course the study would take.
Chapter two tends to explore the works of past authors on the subject of
segmentation and targeting which no doubt provides an in-depth analysis
and a stepping stone to the following chapters.
Chapter three provides a course for data collection method research
design as well and date analysis techniques through which meanings of
the study should be transmitted.
Chapter four tends to show case a thorough out concise interpretation of
data obtained. Chapter five provides a summary of the findings of the
above chapters relating it to the stated problems as well as provides
alternative solutions (recommendations) so as to encourage the practice
of market segmentation and targeting for firms wishing to continue in
their respective businesses and as a way of finding a way out of the
global economic meltdown.
...
TABLES OF CONTENTS
Title page
Approval page
Dedication
Acknowledgement
Abstract
Table of contents
CHAPTER
ONE
1.0 Introduction
1.1 Background of the
study
1.2 Statement of the
problem
1.3 Objective of the study
1.4 Research question
1.5 Statement of
hypothesis
1.6 Significance of the
study
1.7 Scope of the study
1.8 Limitation of the
study
1.9 Definition of terms
CHAPTER
TWO
2.0
Literature review
2.1 Users and uses of
market segmentation and targeting
2.2 Bases for market
segmentation
2.3 Criteria for effective
segmentation
2.4 Procedure for
operating a segmentation strategy
2.5 Benefit of
segmentation and targeting
2.6 Why some business in
Nigeria does not practice market segmentation and targeting
CHAPTER
THREE
3.0 Research design and
methodology
3.1 Introduction
3.2 Research design
3.3 Sources methods of
data collection
3.4 Population and sample
size
3.5 Samples techniques
3.6 Validity and
reliability of measuring instrument
3.7 Method of data
analysis
CHAPTER
FOUR
4.0 Presentation of data
4.1 Hypothesis testing
4.2 Discussion of finding
CHAPTER
FIVE
5.0 Summary of finding,
conclusion and recommendation
5.1 restatement of problem
5.2 Summary of findings
5.3 Conclusion
5.4 Recommendation
CHAPTER ONE
1.0
INTRODUCTION
1.1
BACKGROUND OF THE STUDY
Nowhere
has business practice been more affected than by the growing consumer demand
for variety which posits that relatively homogeneous markets could
not have been satisfied with limited product offerings often as a ersult of the
available resources of organizations which are mostly scares or limited in
nature.
Increasing purchasing power, however, has
caused markets to become more heterogeneous and to demand greater choice
recognition of this change led to wide acceptance of market segmentation
consider distinctive act of needs of even individual’s consumers.
Just as McCarthy Jerome introduced the
4ps of the marketing mix strategy, so also did Henry mintzbery the 5ps of
strategy- pattern, plan play position and perspective, s strategy defined in
terms of consistency in behavior.
When Henry ford developed its model T
automobile only in black colour and many refrigerators launched in white
colour. Seemingly the advantage of one of the 5ps of strategy that is pattern
was taken.
Henry ford introduced the assembly line
concept for automobiles and by the early 1920s, was the largest car producer in
the United States.
His basic market strategy was to price his products very low and to maintain
high volume, the higher the sales volume, the lower were his costs of
production. These lower costs were obtained by operating what may be referred to as “ mass marketing reaching the entire market
with uniform marketing programmes.
Thus Henry ford introduced his only model
automobile only in black colour on the assumption that the entire market
exhibits uniform or similar consumption related behavior.
Awaokon (2000) cites bricker and cope
(1977) where it was noted that in 1922 ford was selling about four times more
than general motors but the situation dramatically changed shortly after Alfred
loan of general motors devised a totally different strategy. This
strategy recognized different strategy of the same market iin that people show
different responsiveness to various marketing programmes mounted by an organization. It was on this
assumption that general motors launched different cars for different groups of
people Cadillac for the upper class or the wealthy, Buick and Pontiac for the
upper middle income group and Chevrolet for the broadly based working class. In
addition these cars were to be available in a variety of models and colors,
cost were to be kept low by using only three basic body shells, but each had a
number of distinctive features that differentiates it from the other. This
strategy technically referred to as market segmentation had brought great deal of success to general
motors well above Henry ford since 1928 to data and also to business especially
inductive of the fast foods businesses like chris fast food restaurant in
Owerri. To provide a direction for understanding this topic, we must define the
words that make up the topic phrase.
Arowomole and Adeyemi (2004) define
market as the actual and potential buyers of a product or service. They stress
it as an aggregate of people who as individuals or organization have the needs
for products in a product class, nad have the ability willingness and authority
to purchase such products.
Same work also defines segmentation as
the process of dividing a given element such as market population country and
area into sub- divisions in which each is homogeneous in all significant
aspect.
From the above stated one can now deduce
the meaning of market segmentation as defined by authors. Schiffman and Kanuk
(1987) defines it as the process of dividing a heterogeneous market for a
product into distinct subsets of consumers and selecting one or more segments
as a target to be reached with a distinct marketing mix.
Also, Arowomole and Adeyemi (2004) posit
that the method of dividing the total heterogeneous market at large into
specific sub- market that are homogeneous in nature and tailoring market
offerings to fit carefully defined needs of specific segments or groups.
Hence, in the course of dissecting what
market segmentation is all about, another concept called targeting comes into
play. Targeting as described by Awa Okorie (2000) is said to involve assessing
the size and potential of each segment identified against a firm’s expertise
and objectives and selecting such that can be served with available marketing
programme. In other words. It involves
reaching those segments of the market that meet the firm’s capability,
objectives, allowable risks etc. especially in cases where firms do not have
the general capability to target all potential segments.
The argument for mass marketing is that
it creates the largest potential market which leads to lower costs lower prices
or higher margins (economics of scale
advantage).
However, critics point to the increasing
splintering of the market which makes mass marketing more default. The
proliferation of advertising media and distribution channels which enhances
consumer’s capabilities to chosses among alternatives also makes mass marketing
difficult and expensive, thus making most companies turn to micro marketing at
levels of segments, niches and even individuals.
Though, businesses in Nigeria such as those in the medium
scale business are yet to realize potentials that exsit in practicing market
segmentation and targeting as strategies for their growth of which this study
would definitely fully expose.
1.2 STATEMENT OF PROBLEMS
It
might be understood that mass marketing may I offer temptations benefits but
with the complexity of market
environment i.e cultural social economic
etc. it is getting difficult to practice and as
such, firm’s have not realized that markets are not homogenous and still
can not connect with all customers in large and diverse market as consumers
vary on many dimensions and often can be grouped into one or more
characteristics in addition, the expensive nature of operating in Nigeria also
discourages the practice of proper
segmentation as businesses want to maximize profit and sales volume.
The complexity and frequent changes
associated with consumer needs, also makes it difficult to properly segment the
market that is why firms do not bother at all.
Marketing research which would have been undertaken
to property identify lucrative segments is considered expensive and time
consuming, hence making product offerings to be glorified instead of needs and
wants. This study hopes to analyzed and solve those related problems as well as
to expose its influence on business growth.
1.3 OBJECTVIES OF THE STUDY
The
objectives of the study are as follows
v To
fine out how consumers characteristics affect the choice for a segment
v To
find out the relevant adoption of market segmentation and targeting strategies
for competitive business growths.
v To
find out how much influence marget segmentation and targeting have on a firm’s
profitability and sales volume, considering its limited resources.
v To
examine how well both the firm’ and it’s
consumers are being effectively served and satisfied as well as make
recommendations based on finding.
1.4 RESEARCH QUESTION
v How
well do consumer’s characteristics affect the choice for a segment?
v Is
there a relationship between the adoption of market segmentation and targeting
for business growth?
v What
influence market segmentation and targeting have on a firm’s profitability and
sales volume, considering its business resources?
v To
what extent the firm’s and its consumers
are being effectively served and satisfied, as well as make recommendations
based on findings
1.5 STATEMENT OF HYPOTHESIS
The
following conceptual statement depicts the relationship that exists between
variables subjects to testing and will be used in this study.
HO1: The adoption of
market segmentation and targeting strategies does not influence a firm’s
competitive growth.
HO2: The adoption of
market segmentation and targeting strategies influences a firm’s competitive
growth.
1.6 SIGIFICANCE OF THE STUDY
The
essence of the study is to unveil the unique attributes associated with the
strategies of market segmentation and targeting as well as exploit benefits
that lie in them and recommend its best use.
The findings also would hope to establish
problem areas that comes with properly reforming and implement market
segmentation strategies with a view to recommending simplified solutions it
would equally serves as an information base for potential entrants of medium
scale business and other businesses.
For Chris fast food restaurant it will
help them to re-examine their segmentation and targeting strategies as well as
touch - up on the necessary points where consumers may have
complaints for a stronger and better relationship on the part of the consumers
it would provide a platform to offer answers to questions as well as offer them
an opportunity to get back to the form with their own opinions and suggest ways
they could be served better.
1.7 SCOPE OF THE STUDY
The
extent of coverage of the study is defined within the frame of the research
topic as well as the case study. These the study will extensively investigate
how much satisfaction a firm is benefiting from serving its market segment of
choice and how well consumers are satisfied from the products they purchase and services they receive.
1.8 LIMITATION OF THE STUDY
In
the course of carrying out this study inadequacy of time non- disclosure of
information by respondents, inadequate attention offered by management staff as
well as lack of funding, all pose major constraints in achieving research objectives.
Consequently, the recent like in
transport tares in Imo
State also pose a problem
to the study since it become difficult to get all the necessary places at the
required time. Poor attitude and way of life of Nigerian, coupled with
illiteracy was one of the greatest obstacles. Some respondent were unwilling to
give out the relevant information on and this unco-operative attitude occur
mostly when they are not sure that the data will be used only for research
purpose.
1.9 DEFINITION OF TERMS
v CONSUMERS:
People who buy and use a product or service by which they satisfy their needs
and wants.
v MARKET: The actual and potential buyers of a product
or services who as individuals or organizations have needs for products and
posses the ability, willingness and authority to purchase such products.
v MARKET SEGMENTATION: The
process of dividing a heterogeneous market for a product into distinct subsets
of consumers and selecting a subset to be reached with a distinct marketing
mix.
v SEGMENTTION:
The process so dividing a given element into sub- divisions in which each is
homogeneous in all significant aspects.
v STRATEGY: A
plan of action enquired to attain set objectives.
v TARGETING:
The process of selecting a segment that
can be served effectively and Lucratively
with available marketing resources