The Impact Of Market Segmentation On Sales Performance

Project and Seminar Material for Marketing

The Impact Of Market Segmentation On Sales Performance


The study evaluated market in the beginning of its review of related literatures.

A market is seen as the group of people that are both potential and actual consumers who have some needs to satisfy who are willing to satisfy such need and are financially capable of satisfying such needs. The starting point of any segmentations discussion is the mass marketing. The mass marketing concept is seen as a process by which a seller engages in the mass production, mass distribution and mass promotion of one product for all categories of buyers. The argument by marketing professionals for mass marketing which says that it creates the largest market leading to lowest cost and lower prices is speedily loosing ground today. This is because the concept does not take into consideration the customers oriented philosophy. The marketing concept is acceptable today in that it is a philosophy that first seek to identify customers needs and developing and directing needs to satisfying goods and services to identified customers groups. It is a known fact that satisfied customers not only remain loyal to the firm but also serves as an unpaid medium of advertisement because they promise the firms benefits to potential customers, thereby increasing the sales volume of the firm. Market segmentation strategy is an element of the marketing concept. It is a process of identifying and grouping together customers with similar buying characteristic needs and wants etc and also developing distinct matching marketing mix for them.

Table of Contents

Chapter One


  • 1.1 Background To The Study
  • 1.2 Statement Of Research Problem
  • 1.3 Objectives Of The Study
  • 1.4 Research Questions
  • 1.5 Research Hypotheses
  • 1.6 Scope Of Study
  • 1.7 Significance Of The Study
  • 1.8 Limitation Of The Study
  • 1.9 Profile Of The Company Under Study

Chapter Two

Literature Review

  • 2.1 Literature Review
  • 2.2 Mass Market
  • 2.3 Market Segmentation Its Meaning And Definition
  • 2.4 Benefit And Limitation Of Market Segmentation, Effective Strategy
  • 2.5 Condition For Effective Segmentation
  • 2.6 Approaches To Market Segmentation

Chapter Three

Research Methodology

  • 3.0 Introduction
  • 3.1 Research Method Of Approaches Used
  • 3.2 Justification For Approach Used
  • 3.3 Researcher Instruments Used
  • 3.4 Research Population And Sample
  • 3.5 Justification For Sample Size
  • 3.6 Sampling Procedure Employed
  • 3.7 Justification Of Sampling Procedure Employed
  • 3.8 Statistical Techniques Used In Analying Data

Chapter Four

Data Presentation And Analysis

  • 4.1 Introduction
  • 4.2 Data Presentation And Analysis

Chapter Five

Summary Of Finding, Conclusion And Recommendations

  • 5.0 Introduction
  • 5.1 Summary Of Findings
  • 5.2 Conclusion
  • 5.3 Recommendations
  • Bibliography

Chapter One


1.1 Background To The Study

In every society, consumers are the most important thing to consider while operating as any business. The satisfaction of these consumers now becomes the firm’s ultimate goal. In order too achieve this market it takes a lot of marketing strategies.

One of such strategies is market segmentation, which is a customer oriented philosophy, since no firm can produce and satisfy the whole market. Therefore, for any firm to produce and market its produce and market its product effectively, it has to identify a sub-market within the aggregate market, select and reach with distinct marketing mix.

Today studies have revealed that a marketer‘s success depends on adequate knowledge of his market product and more specifically on his skills in effecting ownership transfers.

Sales performance uses raw data concerning the number of customers a sales associate speaks to compared with the number of actual sales. It indicates the rate of customer loyalty to the business or a specific employee. Enhancing sales performance can automatically enhance the number of loyal customers.

Sales performance can also indicate whether a department is overstaffed. By comparing the sales numbers based on the monetary amount spent on staffing, managers can determine ideal staffing levels.

1.2 Statement Of Research Problem

An understanding of the meaning of market segmentation on sales performance and it’s impact in serving the different market segments is one of the inherent problems in most organization today. Identifying sub-markets either as a competitive strategy or as a measure to burden the market and promote a product to meet the needs of different customer group is a difficult task.

The marketer is faced with controllable variables like product, price, promotion and distribution as well as uncontrollable variables like competition, economy, consumer demand, technology, socio-cultural environment which summed involves huge financial burden.

The Nigerian Breweries Plc, is an organization where the concept of market segmentation can successfully be applied. What management does is to identify and determine the segments existing in a market, to understand the make-up of segments and their needs.

The strength of all these becomes imperative for marketing managers to focus more of their attention on how best to develop strategies for it’s products, most of these problems on segmentation includes;

  1. The need to know whether segmentation is a good marketing strategy on sales performance.
  2. Whether it allows firms to develop specific products that really match the market demand.
  3. Whether it allows for the development of specific promotional message for each segment of the market.

1.3 Objectives Of The Study

The specific objectives of the research work are:

  1. To examine the relationship between market segmentation and product development.
  2. To examine the relationship between market segmentation and sales volume.
  3. To ascertain the effect of market segmentation on organization’s profitability.

1.4 Research Questions

The following research questions are designed to guide the study;

  1. What is the nature of relationship between market segmentation and product development?
  2. What is the nature of relationship between market segmentation and sales volume?
  3. What is the effect of market segmentation on organization profitability?

1.5 Research Hypotheses

The following hypotheses are formulated for the study:

  1. HO: Market segmentation has no significant relationship with product development.
  2. HO: Market segmentation has no positive relationship with sales volume.
  3. HO: Market segmentation has no significant effect on organization profitability.

1.6 Scope Of Study

This study covers the impact of market segmentation on sales performance which is carried out on Nigeria Breweries Plc, onitsha. The study will cover a period from 2014 – 2015 within which the report is expected to be submitted to the department.

1.7 Significance Of The Study

The study will be of great benefit to consumers and individuals in their purchasing pattern. It will serve as a base for further study in the same field or related field by students in tertiary institutions.

It will serve as a frontier of knowledge. It would be used to evaluate good or bad principles.

1.8 Limitation Of The Study

To undertake a research work of this nature, constraints are bound to occur in the course of this study. Some of the constraints encountered include:

Financial Constraints

The researcher lacked the required fund to carry out a research of this magnitude to completion, but the researcher was able to use a balance budget to execute and complete the study.

Time Constraints

The time required to carry out this project research is short and the researcher had to complete within a particular time frame, therefore, a time management technique was used to finish the study within the given time frame.

Lack Of Adequate Information

Lack of adequate information causes a set-back to the study. Information that is vital to this study is considered secret and such not released. Attitude of respondents are sometimes biased in their response this affects the research work. Some give answers that are not objective, some withheld vital information as well.

1.9 Profile Of The Company Under Study

The Nigerian Breweries limited was incorporated in November 1946 for the main purpose of brewing. The original founders of the company were the U.A.C international limited and Heineken international of Holland together with some local trading companies.

On the 2nd of June 1949, the first bottles of star rolled off the Lagos bottling lines, that day marked the beginning of the brewery industry in Nigeria and ever since, it has held it’s place in the fore-front of the brewery industry.

Considerable progress has been made in several aspect of Nigeria Breweries Plc. In 1960, the company’s shareholders were only 1000, the success story states that now they have more than 50,000 shareholders. The company’s authorized share capital was N600 in 1946, today it stands at over N457 million.

Nigerian Breweries Plc, has a portfolio of eight quality brands such as: Star lager beer (1949), Gulder lager beer (1970), Legend extra stout (1992), Heineken lager(1998), Goldberg lager (2011), life continental lager (2011), Star lite lager (2014), Ace passion apple spark (2014).

Their alcohol-free drinks are as follows: Maltina (1972), Amstel Malta (1994), fayrouz (2006), climax energy drink and malta gold (2011).

Together, the brands have facilitated it’s strong leadership position in the total brewed product market in Nigeria. Their outstanding quality and consumer franchise compliment other company values and capabilities to set N.B Plc as the house of quality, it also owns a farm at Gbakogi, Niger state.

MALTINA Maltina to most malt drink consumers in Nigeria is synonymous with a wholesome food drink that is highly nourishing and refreshing. The re-invigorating qualities of the brand are also widely acclaimed by young and old alike. Maltina was the first locally produced malt drink. It was introduced into the market by Nigerian Breweries Plc far back in 1976. From inception, the brand competed favorably against imported brands like Dressler malta, Becks malta, maltex etc. By 1979, maltina had displayed virtually all the while popular brands to gain 70 share of the market. This is clearly evident in the high consumer regard for the international quality of maltina. This was achieved through significant differentiation of the product profile with the addition of two new natural fruit enriched variants launched initially in the Lagos sales area in September 1996. This positive development, was aimed at reversing the rather boring malt drink unsafe occasion characterized by just one monotonous taste flavor day in day out for so many years. The profile of each of the four variants of maltina is described thus:

  • MALTINA with exotic fruits
  • MULTI- VARIANT MALTINA features the following positivecharacteristics.

A truly natural ingredient base making the brand very much healthier than those of the other malt drink brands that are made from synthetic components.

Extra nourishment from natural fruits in addition at the multi-vitamins and minerals in maltina.
Satisfying non-sugary fruits taste that was massively endorsed by Nigerians who have savored the extra-rich tastes.
Apart from vitamin B1,B2, B6 AND C from natural –malt sources, the fruit enriched MALTINA variants contain higher levels of vitamin C that are derived from strawberry, apples, oranges, black currant and banana. Nigerian Breweries is a model of success in the private sector. The company’s high price, profitability and successful operation can be traced to good product quality, efficient management of operation and strategic penetration into the market environment through segmentation of product others are proper understanding of consumer attitudes and habits.

Objectives Of N.B. Plc.

The sales force objectives are:

Prospecting: sales representatives are expected to find and cultivate new customers.


sales force are supposed to be skillful in communicating information about the company’s products and services to the existing potential customers.


The sales representatives are expected to be effective in the art of salesmanship, that is being effective in approaching, presenting, answering, objections and closing sales.


Sales force must provide various services to the customers, including consulting on their problems, reading technical assistance, arranging, financing and expediting delivery.

Information collection:

Sales representatives are supposed to carry out some market research and intelligent work, and supply sales on their customer calls.


Sales representatives are expected to evaluate customer profitability and advice the company on allocating scarce product to their customers in times of shortage.

Chapter Five

Summary Of Finding, Conclusion and Recommendations.

5.0 Introduction

This very chapters deals with the summary of findings. It is also concerned with marking relevant conclusions on all the discussed data collected and analyzed in chapter four and five.

The researcher made adequate recommendation in areas requiring such, in order to enhance the adoption of the strategy for effective segmentation as it relates to sale volume increased by Nigeria Breweries Plc.

5.1 Summary Of Findings

Marketing segmentation effect strategy helps marketing managers analyze particular total market demand in terms of its consistent part, thus dividing the heterogeneous market into sub-markets or market segments’ in which the consumer wants and buying characteristics in each segments are essentially homogeneous, such that the market can develop a specific marketing mix for the particular segment that is chosen as target market.

Market segmentation as a strategic process seeks to establish. Diversities, which may exist within a given market, which may lead them to uncover market opportunities. It aids marketers target its resources both human and material towards satisfying single or few segment of the total market.

Market do not start segmenting their market until a thorough marketing research is conducted into customer buying characteristics and needs (diverse characteristics) and based on certain segmentation variables the firm can then divide the total into distinct sub-sets. With the satisfaction of customers group identified needs and wants, the firms is able to achieve increase sales volume and profitability. In conclusion, through market segmentation produces a lot of benefits to the firm, amongst sale volume increase and many others, it results in higher marketing costs and other overhead costs.

5.2 Conclusion

Market segmentation as some authors have rightly said, it is an important strategy in marketing it is a logical trade of the present widely acceptance marketing concept.

The adoption of market segmentation strategy depends on the existence of a number of needs, which must be large enough to be served profitably.

It is a deliberate tool for maximizing market demand targeting market matching marketing mix, a significant segment of consumers.

From proceeding chapters, it has been clearly observed that the strategy of segmentation recognizes that people differs in their needs, wants, buying characteristics, attitude, firmly size, income level, and life style etc.

Thus marketers must develop distinct marketing mix for different segments. They study was clearly shown that firms must consider different market segments in order to pace way to identify in reaped opportunities. Satisfied market segment yield high sales fro the company’s marketing effort.

Firms have recognized the significance of market segmentation strategy to the market of their product. Thus they are adopting and applying the concept to their marketing activities especially from its strategy planning perceptive.
The measure of success observed by Nigeria Breweries from adoption of market segmentation is commendable.

It has been noticed that segmentation strategy does enhance Nigeria Breweries identify target market. That the research observed that the strategy of mass marketing adopted by Nigeria Breweries does not allow the firm direct its marketing resources to target groups, resulting wastage of time and money.

With the adoption of segmentation strategy, Nigeria Breweries foods were able to direct it marking efforts to a profitable target market group in essence the company’s segmentation strategy was achievable using a number of variable in the segmentation process in order to group together consumer with similar needs, wants and buying characteristics.

Geographic, demographic, behavioral, psychographic variables are collectively applied, but most often, these generate numerous costs.

Thus the demographic variable were extensively adopted by Nigeria Breweries Plc.

Nigeria Breweries has enjoyed a lot of benefit from customers. Satisfaction and high profit margin. Yes it was observed that the adoption of market segmentation strategy increase cost excessively covers all increase in marketing expenses).

However, with all time above mentioned benefits derived from the company market segmentation strategy the researchers observed that the strategy limits larger market coverage. The researcher notice that Nigeria Breweries Onitsha does not recognize the significance of promotional activities to the success for its market operations for instance promotional activities such as advertising, sales promotion, publicity and personal selling are not adequately used in conducting other marketing activities.

The investigator observed that the rate of turn over of Nigeria Breweries personnel management staff is very high and this does not argue well for the company’s business in terms of efficiency and effectiveness and in particular for the company’s policies continuity.

5.3 Recommendations

The following recommendations are made based on the findings of the study in order to help the management of Nigeria Breweries Plc Onitsha do a better job of marketing management most consistently monitor trend in the consumer market.

In order to identify changes in consumer profiles, which could affect the level of demands and thus its resultant affect sales volume too.

The firm must always monitor the market trends in order to a adopt new strategies to maintain its market share as the leader and subsequently develop innovative products that will satisfy the dynamic market. Nigeria Breweries management is advised in accordance to economic situation to develop suitable marketing mix that will satisfy customers needs.

This is because of the economic depression affects consumer purchasing power leading to decrease in sales. This requires further product sizes to its income groups.

Effective promotion of the firms product enhances profitability and consumers awareness of the company’s product and marketing activities Nigeria Breweries Plc is advised to enhance its promotional activities such that it extends to the rural areas because that market is an emerging potential market which will be a profitable market segment. Nigeria Breweries is advise to reduce the level of employee turnover.

In order to obtain a positive corporate image, Nigeria Breweries is also encouraged to adopt more of demographic segmentation variables in the segmentation process. This is because demographic variables comprises of sex, income, age, educational level etc.

Nigeria Breweries is also advised not only to direct its marketing activities to large market segments but even small and profitable market segments Nigeria Breweries Plc Onitsha is advised to conduct marketing research into the small but attractive markets. In order to enhance consumer diverse characteristics, which will suits its marketing objectives and resources in order to direct its efforts.

Employees remuneration system should be improved (especially the sales staff in the field) to motivate them to work hard.

This motivation will encourage the staff serve as the firms eyes and ears acting as intelligence officers to observe changes in the market.

This analysis of the market situation will expose attractive opportunities existing in the market or unsatisfied customers group to enable the firm target its marketing activities towards satisfying them.

Interview and surveys should be embarked upon to determine the level of customers satisfaction and dissatisfaction resulting product consumption.

These will guide the firm in developing and adjusting its product features, qualities styles and even the promotional activities such and even the promotional activities such as advertising messages.

The consumer products market is increasing and attracting new competitors into the industry Nigeria Breweries must adopt the strategy of continuous innovation in order to offset the activities of its competitors.

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