BRANDING AS A MARKETING TOOL IN SALES PERFORMANCE: (A CASE STUDY OF DANGOTE CEMENT PLC)

CHAPTER ONE:

INTRODUCTION

         1.1   BACKGROUND TO THE STUDY

In discussing branding as a marketing tool in sales performance, two crucial areas of importance for businesses are examined. First, demand stimulation for existing products, services, ideas, process; and creating demand for latent offerings resulting from new product and process innovation in terms of important issues for enterprises. Secondly, favourable competitive stands in terms of existing technology and future ideas within the market in general, are also vital for successful marketing tool. 

The combination of these two needs influences the ‘permanent’ needs for foreseeing and predicting the future (Drucker, 1998). While the first need may have emanated from the specific nature of the practical activity associated with planning and projecting as manifestation of goal setting, the need for creating favourable competitive stance for firms’ performance is also apparent as a rationale for prediction. Since any plan or project relates to something that does not yet exist, and has to be created, its evaluation and realization call for a more or less ‘clear’ picture of the future.

Planning and projecting for future demand also exerts an influence on the present, determining the choice of options and the appropriate behaviour.

However, as the competitive turbulence becomes constant in business environment, the goal itself is not to predict the future –which Drucker, (1998:vii) regarded as a lofty idea in the first place- but to anticipate a future made possible by the effect of changes taken place  and made possible by the existing process as it intertwined with the present and stimulates the future.

One of the most recent ideas in the history of exchange relations is the branding concept. The banding concept is a management orientation that holds that the key task of the organization is to determine the needs and wants of target markets and to adapt the target organization to delivering the desired satisfaction more effectively and efficiently than its competitors.

Economic history is well stocked with enough insight into the humble beginnings of present-day great corporations. Evidence abound that about all of the multi-national giant corporations in America, Europe and Nigeria were once cottage enterprises that grew as a result of the sheer ability and especially the banding  skills and efforts to produce and reproduce existing products better and cheaper.

The adoption of a customer orientation, which forms the basic assumption of the marketing function of a firm, places a high premium on customer satisfaction.

This of course has very wide applications for all areas of the organization. One major implication is that if the firm or organization has to manage its limited financial resources profitably, there is an acute need to identify consumers’ needs and wants before actual production or provision of the goods is undertaken. In the absence of this, the company may be faced with the threat of product failure in the face of more competitive brands.

One of the most frequently used for identifying consumers’ needs and wants is the study of brands and brand preference patterns. Brand preference consists of a customer’s perception of a brand’s ability to satisfy his prescribed set of needs more than similar brands in the product class. A consumer’s preference for a particular brand among alternative brands is an indication that ceteris paribus, he will translate this preference to a purchase action when the situation arises. Consumer preference therefore is a crucial factor for management consideration especially in an attempt to implement the banding concept. Since modern marketing holds the consumer as the centre-piece of all marketing actions, it appears logical to state that no fruitful marketing programme can be formulated and implemented without vigorously attempting to identify the tastes and preferences of the target market.

The need for this becomes even more crucial in a developing economy like Nigeria’s at the threshold of technological take-off.

An understanding and determination of consumer preference and the factors that give rise to them ultimately becomes highly fundamental in planning and implementing the company’s branding strategies. Branding and brand preference do result from both the nature of the product, the characteristics of the producer, the seller and the consumer as well as the prevalent situation. In an attempt to understand consumer preference on the basis of the nature of the product, one basic approach is consumer attitude measurement. Hence the inefficiency and ineffectiveness in the distribution management of the products in the building industries in Nigeria prompted this research and also to investigate the factors responsible for this poor sales performance and also to proffer some workable solutions to them.

 1.2       STATEMENT OF THE PROBLEM

Numerous researches have been carried out to investigate the relationship between brand preference and consumer characteristics, characteristics of the product and the existing economic situation. Also the relationship between branding and sales performance.

Most researchers have used numerous measures which are not products of brand-specific to establish the relationship. Majority of these researchers have attempted to study consumer preferences and choice on the basis of personality, psychographic and demographic characteristics.

However, Engel, Kollat and Black well pointed out that since World War II, economic and demographic variables have become less reliable determinants of products and brand preferences and choice, while personality variables have made minimal contributions to the understanding of consumer behavior.

1.3       OBJECTIVES OF THE STUDY

Due to the fact that we have many cement companies in the country today, there are many brands of cement in the market. The variety of brands of cement in the market has increased the consumer’s ability to exercise choice with less restraint. Therefore, the objective of the study is;

i.    The primary motives underlying the choice and subsequent purchase of a brand.

ii.     The consumer’s preference pattern for each brand.

iii.    The attributes that appeal to the consumers in their order of importance.

v.      How companies can improve sales performance through branding.

vii.     To make recommendations in form of proffering solutions to the existing    problems.

1.4       RESEARCH QUESTIONS  

·        Is there any correlation between branding and sales performance?

·        Is branding a good marketing tool?

·        What are the pros and cons of branding?

·        How effective is branding?

1.5       STATEMENT OF HYPOTHESES

A hypothesis is a tentative answer to a research question. It is often stated in the form of a relationship between a dependent and independent variable (Agbonifoh and Yemore, 1999).

A hypothesis may be stated in a null form (H₀) or in the alternative (H₁).

Thus, the following hypotheses are to be tested:

Hypothesis I

H₀:   There is no correlation between branding and sales performance.

H₁:   There is a correlation between branding and sales performance.

 Hypothesis II

H₀:   The way a product is branded does not affect its sales.

H₁:   The way a product is branded does affect its sales.

 Hypothesis III

H₀:   Branding does not affect the way a product is distributed.

H₁:   Branding does affect the way a product is distributed.

 1.6    SIGNIFICANCE OF THE STUDY

The significance of branding and brand preference as a marketing tool such as this one is relevant in present-day Nigeria’s dynamic socio-economic environment to which the cement or building industry belongs.

Products are subject to life cycles. A particular product may emerge suddenly, enjoy rapid growth and reach a point of relative maturity and eventually move into a period of slow decline. The implication of this is that a company needs to identify consumers’ needs and wants before producing its brand; otherwise, chances are that it may be faced with a threat of product failure in the face of more competitive brands in its product class.

1.7       SCOPE AND LIMITATIONS OF THE STUDY

This study is aimed at investigating the impact of branding as a marketing tool for sales performance (Dangote Cement Plc, Abuja) was used as a model organization.

Because of resource constraints, Dangote Cement Plc, Abuja, was studied.  All the department and cadres of employees will be covered in the study.

LIMITATIONS: The researcher faced the problems of confidentiality. Dangote Cement Plc employees sometimes were not willing to give information.  But this problem was dealt with by the researcher assuring members of staff that the information given will be used only for research purposes and was to be treated as confidential. Another limitation was Time. The researcher is a worker and also doubles as an entrepreneur. Time is not always enough due to multiple events going on at the same time i.e.  office work, lectures/preparation for exams etc.

Finally, financial constraint was another problem faced by the researcher; money to buy books, stay connected online for research, moving around to various libraries etc. was one of the major limitations.  But the researcher gave the project its best.

1.7       DEFINITION OF TERMS

Tool: An item or instrument used for a specific purpose. A tool can be a physical object such as mechanical tools including saws and hammers or a technical object such as a web authoring tool or software program. Furthermore, a concept can also be considered a tool. “Creativity is the tool which allows a child’s mind to grow.”

Branding: Is the process involved in creating a unique name and image for a product in the consumers' mind, mainly through advertising campaigns with a consistent theme. Branding aims to establish a significant and differentiated presence in the market that attracts and retains loyal customers.

Performance: The accomplishment of a given task measured against preset known standards of accuracy, completeness, cost, and speed. In a contract, performance is deemed to be the fulfillment of an obligation, in a manner that releases the performer from all liabilities under the contract.

Organization: A social unit of people that is structured and managed to meet a need or to pursue collective goals.

Dangote Cement Plc: Dangote Cement is Africa's leading cement producer with three plants in Nigeria and recently opened factories in Senegal, South Africa and Cameroon.