Impact Of Product Branding On Sales Performance In The Nigerian Brewery Industry

Project and Seminar Material for Marketing

Abstract

This research was carried out with the objective of determining the impact of product branding on sales performance in manufacturing sector. A case study of Nigerian Brewery Industry. Data for the study was collected from both primary and secondary sources. Table was used to present the data and percentage was used to analyze the data. The result revealed that branding enhances sales performance in Nigerian Brewery Industry. The study recommends that management should ensure that good branding strategies should be adopted to enhance sales performance and sales volume.

Chapter One

Introduction

1.1 Background to the Study

Brands and branding are by no means a new phenomenon, neither for academics nor the business world. It is possible to trace back the use of brands to the Stone Age, when hunters used weapons of specific “brands” to succeed in the hunt Almquist and Roberts: (1995). It was during the 16th century, however, that brands similar to those we see today have started to take shape. Some of the earliest-known brands were established by the English ceramist Josiah Wedgwood and the French fashion designer Rose Bertin Burke (1996); de Paola (1985). Since the 18th-century England and France, there has been a massive development of the knowledge, procedures, and theories within branding. Contemporary branding theories have their origin and evolutionary starting point in the mid-20th century, primarily due to the development of commercials in mass media Farquhar (1995: 10).

One of the most recent ideas in the history of exchange relations is the marketing concept. The marketing 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. The relationship between the consumer and the brand – consumer’s perception of that brand – is the key to brand acceptance. The strength of the relationship between the consumer and the brand will reflect the fit between the consumers own physical and psychological needs and the brand’s functional attributes and symbolic values, as perceived by the consumer Hankinson and Cowking, (1993)

It has been shown that consumers define the brand relationship from their own individual perspectives and the brand relationship and relational value are very much personalized in the minds of consumers. Customers generate individual relationships based on their individual perception of brand value, brand meaning and their experiences. That is, customers seem to personally create the brand through their communications across multiple contexts. Lindberg-Repo, Kirsti, (2001:233).

Fournier (1998) argues that brands could be seen as a relationship partner, and a way to legitimize the brand-as-partner view is to highlight ways in which brands are animated, humanized, and personalized. Fournier reveals in her research that consumers are of the opinion that they have several relationships with different brands. Consumers feel that such relationships add value and purpose to their existence, and these extra values could be both functional and emotional by nature.

The concept of brand identity has received much attention, and today the majority of marketing companies have specified their brand identity in corporate documents. Brand identity has grown to become a wide concept, now encompassing many of the earlier discussed theories, e.g. positioning, relationship, and brand personality. According to Kapferer (2008) the brand identity gives guidelines to what parts of the brand should be kept the same and what elements can be modified, allowing brands to evolve in time.

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 marketing 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 means 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 marketing 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 become highly fundamental in planning and implementing the company’s marketing strategies. Brand 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. For that reason, marketing academicians and practitioners see the symbolic image of products or services as more important in their success than their physical characteristics and attributes Aaker, (1991).

It therefore becomes imperative to embark on this research to explore ways of solving the problem and restoring confidence. This is the essence of this study with a particular focus at the impact of product branding on sales performance in the Nigeria brewery.

1.2 Statement of Problem

Branding is an important issue in any organization. This is because without a proper branding of a firm‟s products, it‟s difficult for the firm to run its operation smoothly for profit. As consumer become more sophisticated, manufacturers place more emphasis upon promoting their brands directly to consumers (rather than to distributors) spending considerable sums on advertising the high quality of their products thus sales performance.
Furthermore branding has been a major issue especially in developing countries. As a result in order to explain the relationship between branding and sales performance in developed countries.

However, despite the above importance this issue failed to attract the attention of researchers in Nigeria. Thus, while searching on internet, browsing through the books and journals the researcher didn’t find directly related research topics carried out in Nigeria.

Manufacturers also believe that they will be less susceptible to demand from distributors for extra discount to stock their brands. For some products (e.g.) perfumes and alcoholic drinks), considerable effort has been devoted to promoting brands to reflect the personality of their likely purchasers.

Marketing research has indeed shown that for these products consumers can be persuaded to buy brands that enhance the image they have of themselves.

Manufacturers believe that if they invest in the quality of their brands they will build up a brand image to which consumers will respond by asking for their foods by their brand names and by being willing to pay a premium for them.

Therefore the researchers believed that the problem is almost untouched and there is a knowledge gap on the area. It is against this background that the research seeks to investigate whether branding adds to the sales performance of manufacturing company.

1.3 Objective of the Study

To find out the extent to which manufacturers engages in sales promotional activities including branding.
To evaluate the different branding strategies adopted by management of Nigerian Brewery Industry.
To identify the extent that product branding has led to increase in sales performance and return on investment in the company.
To find out the extent to which brand name has influence on consumers purchase decisions.

1.4 Research Hypothesis

H0: Branding has no significant effect on the sales performance of Nigerian Brewery Industry.
H1: Branding of products has a significant effect on the sales performance of Nigerian Brewery Industry.

1.5 Significance of Study

This study by its substantive examination of past literature has contributed to the richness of the past studies. Furthermore, it has reinforced some past knowledge, updated information in studies relating to branding and how it enhances sales performance in a manufacturing industry. However, it does not pretend to be a new breakthrough in the frontier of knowledge. This work can be retrieved for use by other researchers and writers particularly in related fields such as the social science and psychology. For these stated reasons, it is hoped that the effort and time expended on this study has been worthwhile.

1.6 Scope of Study

The study limits its scope on the manufacturing sector of Nigeria only and precisely on how branding in a manufacturing sector enhances sales performance (case of Nigerian Brewery Industry). Here, attempts are made to look at concept of product branding, product branding, branding strategy, effects of product branding or their significant contribution on organizational sales performance.

1.7 Limitations of Study

A study of this nature cannot be effectively carried out without certain constraints. However, these constraints do not have any prejudice on the result of the findings in the course of the study.

The major limitations of this study include inadequate resources; the unwillingness of some respondents to give all necessary information required. This work is not conclusive on its own; it is still open to further research studies.

1.8 Definitions of Key Terms

Profit:

This is the money made in business or by selling things especially after paying the cost involved. It could also be seen as inflow of assets into the firm as a result of sales of goods and or service by such firm.

Brand:

Brand is defined as the totality of product features such as a name, term, symbol, colour, design, mark or combination of things that distinguish it from other products or a means by which the firm identifies it to consumers.

NBI:

Nigerian Brewery Industry.

Chapter Five

Summary, Conclusion and Recommendation

5.1 Summary

This research project has continuously tried to emphasize the fundamental essence of enhancing sales performance through product branding among manufacturing companies in Nigeria. In the course of this study, NBI was adopted as the case study with the aim of trying to analyze its product brand in enhancing profit and increase in sales. The study findings clearly indicates that branding of NBI product is one of the determinates of sales and continuous increase in return on investment and among the company‟s product, five alive, sprite, fanta, coke etc.

In chapter one, the research topic was thoroughly introduced giving an insight into the nature of the study. Chapter two contains reviewed literature and text written by scholars and researchers relating to the study. The historical background of NBI in Nigeria Chapter three focused on research methodology where the research design which involves research for solution to problem through planned and systematic approach was discussed. For this work, the exploration and descriptive research design were used also primary sources of data which involves the use of first hand information and secondary sources which uses information that already exist were used to source for information. The research instruments used for data collection was personal interview and the administration of questionnaire. the sample size used for the work is 60 comprising of 10 staffs of Nigerian Brewery Industry, 15 distributors of the companies product and 35 consumers of the companies product. Finally, the percentages and Chi- Square was used in analysing and presentation of data

Chapter four presented the data collected from the administered questionnaire which were then interpreted and analysed using the percentage and Chi- Square method. After the interpretation and analysis, the alternate hypothesis was accepted while the null hypothesis was rejected since the value which is 27.03 is larger than the table value.

5.2 Recommendations

Based on the researcher‟s findings, branding is one of the determinants of sales in NBI. Because of this, competitors may want to imitate the brand of NBI in order to:

To forestall the occurrence of competitors imitating the brand of NBI. The branding should be done in such a way that it cannot be imitated.
The researcher also observed that the problem of improper financing, planning, poor branding and insufficient sales can be revered. This can be achieved through proper allocation and use of funds and accurate planning and forecasting techniques to be used by management.
Good branding strategies should be adopted to enhance sales performance and sales volume.
Finally, employees‟ loyalty should be maintained by adequate monetary and non- monetary rewards. The company should keep abreast of developments in the labor market as a means of ensuring rewards viz-a-viz other manufacturing companies. This is because, equipment no matter how sophisticated they are must be operated by people and finally frustrated employees are a threat to a company‟s profit enhancement.

5.3 Conclusions

From the research, it is evident that principles of enhancing sales performance tools and techniques are quite applicable and have been used in Nigerian Brewery Industry (NBI) companies in Nigeria like any other industry that deals with tangible and intangible products. Market has been segmented so also the customers and products were differentiated to the target markets that results into different brands both heavy customers and light customers with the aim of increasing profit among manufacturing industry.

Nigerian Brewery Industry PLC has been able to retain and motivate its channel members thereby increasing the market position of the organisation. The company management has been able to improve its knowledge of the needs of its consumers and fine turning its strategies to quickly adjust to changes in the environment. To a large extent the company has been in a fairly good position to withstand the threats of competitors within the industry like 7up bottling company, Chi Nigeria limited, Nigerian brewery just to mention a few.

The company should refrain from loading the distributors with excessive inventories but providing adequate sales potential, monitoring distributors profits to ensure that their channels remain financially viable
The company should embrace the marketing strategies of constantly innovating and improving their products to increase consumers satisfaction
A strong intelligence network should be maintained to enable the company monitor the activities of competitors in the industry on regular basis
The management of the company should explore every opportunity possible to create innovation which motivates its distributors and consumers of its products with a view of having competitive advantage

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