ABSTRACT
The study investigated the effects of branding on
Godfrey Okoye University students’ patronage of GSM service providers. It sought to find out the most patronized GSM
network by students of Godfrey Okoye University Enugu. A descriptive survey
research design was used in carrying out this research work with a population
of 1600 students. A sample of 309 students were used for the study. The
researcher used Taro Yamane formula in determining the sample size for the
students. The questionnaire contained both open ended and closed ended
questions to elicit responses that were analyzed. In analyzing the data,
percentages and frequency tables were used based on the research questions and
the hypotheses were tested using chi square. The findings of the study revealed
that the most patronized GSM network service is MTN. It shows that a brand name
of a GSM network differentiates it from others. The result also shows that
brand name does not have effect on GSM network patronage. It was also revealed
in the study that awareness on the image of a product, serves as a means of
corporate communication. Reenergizing market position and bringing new vision,
mission and values are some of the effects of branding on patronage. It
recommends that to improve on the strength and the appeal of a brand to
consumers, there is need for the enterprise’s name to symbolize the makers’
promise that consumers’ expectations will be fulfilled; since brand name that
differentiates a product from another, there is need for GSM providers to adopt
names that attract retailers and consumers.
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
The world is fast becoming a
global village. Information, communication and mobile telephony will certainly
make it practicable. Using mobile phones has become indispensable. Mobile
phones are fast dramatically spreading to the remotest parts of the world
(Friedrich, Grone, Holbling, & Peterson, (2009). Reportedly, by 2015, more
than half of the world inhabitants are expected to be using mobile phones
(World Telecommunication /ICT Development Report, 2010). What is evident is
that Global System for Mobile communication (GSM) has been playing a
significant and stimulating role to most nations’ economic development in the
last few decades (Paul,
Howard & Alexia, 2010). In Nigeria, with democratization and
the inception of GSM in 2001, and with a growing population of about 160
million people and 78% subscribers Tele -density, the industry has increased
from NITEL (or government monopoly) to a highly competitive market with market
share spread of 46.19%, MTN; 26.87%, Glabacom; 24.74%, Zain (Celtel, now
Airtel); 1.76%, Etisalat; and 0.44%, Mtel (NCC Report, 2009). More operators
are expected to be licensed in the near future. GSM has contributed significant
increase of 3% - 4% in 2009 to the Gross Domestic Product (GDP), to technology
transfer, and employment in Nigeria (Gabriela and Badii, 2010). It has also
contributed indirectly to the correction of market inefficiency, transport
substitution, risk aversion and social cohesion (Asheeta, Rowena, Subramanian
& peter, 2008).
Currently, GSM operators have
realized that retaining existing customers is as important as acquiring new
ones (Coyles and Gokey, 2005). In view of this, operators now strive to
determine what factors influence customer patronage. Though, the complicated
interrelationship among key constructs; service quality, brand image, customer
value, customer patronage, and satisfaction have not been fully uncovered and
understood (Jones and Sasser, 1995), yet it has been found that in different
countries unique factors play active role in influencing customer patronage and
loyalty in mobile telecom markets (Gerpott, Rams & Schindler, 2001;
Ahn, Hun & Lee, 2006; Ranaweera and Neely, 2003; Lee and Feick, 2001).
Aside these key factors -service quality (Wan-Jin, 2009); brand image (Boohene
and Agyapong, 2011) and customer value are significant factors influencing
attitudes have been done but we cross-validate these three key significant
constructs in an emerging viable market segment in Nigerian growth stage of GSM
industry.
Many
authors have defined the term ‘brand’, among these is the Oxford American Dictionary (1980)
defines brand as a trade mark, goods of a particular make. Also the
American marketing association who defined brand as any name, term, sign,
symbol, or design, or combination of these that identifies the maker/seller of
the product or service and differentiates it from competitors. Similarly,
Kotler, Bouden & Jane, (2006) defined brand as image or perception about a
particular product as reflected in a consumer’s memory.
The phenomenon of brand is less
common in industrial market and is the side of technical product. The
efficiency of branding is in its ability to coalesce the constellation of ideas
and concept surrounding a product or service there by facilitating the
communication process, this is generally termed the brand image and reflects at
any point in time the overall status of users’ perception of a company
offering.
In the United States the earliest
brand promotion was the patient after the civil war, with growth in branding
firm and national media and with some early brands such as, condensed milks,
oat and luxury soap (Kotler and Keller, 2006). Interest in branding has been so
dramatic that today in United States hardly anything is sold unbranded.
Therefore brand names should be treated highly as an integral strategy to
reinforce a product. It is the duties of companies to build a unique brand name
that can be easily identified with a generic product. It is worth recognizing
at this state that many companies fail in their product because it lacks a good
brand name.
Branding is major issue in product strategy, it is expensive
and time consuming. It can make or break a product; marketing
program/communication creates brand awareness or image that is used to
influence consumer behavior or patronage.In Nigeria, many organizations
including GSM service provider embark on sponsorship and public enlightenment
programmes in order to make their brand name known to consumers, MTN Foundation
and Glo sponsorship of football premier league are laudable examples. Brand
cues are not only created by marketing program or communication but through
direct experience, brand information, word of mouth, channel members, country
of origin and place, In short, everything that has to do with the touch point
between the brand and the customers. Ideally, for an organization to achieve
brand reputation it must have huge brand equity.
Brand
equity is a phrase used
in the marketing industry which describes the value of having a well-known
brand name, based on the idea that the owner of a well-known brand name can
generate more money from products with that brand name than from products with
a less well-known name, as consumers believe that a product with a well-known
name is better than products with less well-known names (Aaker, 1991; Keller,
2003 & Leuthesser, Kohil & Harich (1995). Brand equity is strategically
crucial, but famously difficult to quantify. Many experts have developed tools
to analyze this asset, but there is no universally accepted way to measure it.
Some marketing researchers have concluded that brands are one of the most
valuable assets a company has, as brand equity is one of the
factors which can increase the financial value of a brand to the brand owner,
although not the only one ( Belk, 1975 & Grannell, 2009). According to
Keller (1993), elements that can be included in the valuation of brand equity
include (but not limited to): changing market share, profit margins, consumer
recognition of logos and other visual elements, brand language associations
made by consumers, consumers' perceptions of quality and other relevant brand
values. Brand equity is created through strategic investments in communication
channels and market education and appreciates through economic growth in profit
margins, market share, prestige value, and critical associations. Generally,
these strategic investments appreciate over time to deliver a return on
investment.
According to Neumeier, (2006) consumers' knowledge about a
particular brand determines the extent of patronage. Customers’
patronage or consumption can be viewed as a way defining oneself and developing
links with likeminded others (Holbrook, 1992; Belk 1975; Zeithaml and Bitner
2000), and of connecting with others within a broader social system. Schiffman
and Kanuk (2009) identified factors that positively influence and impact on
social affinity group as: task/situational characteristics, group
characteristics and personal characteristics, information experience,
credibility, attractiveness, and more importantly the Brand characteristics,
and power of the reference group. Social affinity acts in benefiting social
approval, customer referral, and positive word- of- mouth communication, social
cohesion, and loyalty (Vela-McCobbekk 1997; Solomon, 2009). Importantly, all
these translate to the bottom line financial benefits. It is argued that brand
affinity consists of the following components: Anticipation (Loewenstein,
1987), Trust (Morgan and Hunt, 1994) Social Attraction (Hogg and Hains, 1996),
Loyalty and Commitment (Keller, 2001) and these components mutually combine in
their right mix to exert influence on the group patronage. Contrary to positive
membership or aspirational reference group, also anti groups may also exert
negative influence on consumer purchase behavior.
Every
customer has some level of social relationships and these relationships
influence his /her purchase behavior. The issue is does customer’s social value
and affinity differs in influencing customer patronage? Studies have revealed
that customer social affinity, attachment and level of brand community
influence attitude to use and behavioral usage (Tombs and McColl-Kennedy, 2003;
Macchiete and Roy, 1992). Holbrook (1992) study posited that customer bond and
intimacy both with other customer and the brand itself positively correlates
with attitudinal patronage and behavioral usage.
1.2 Statement of the Problem
The customer is as old as business. The sole purpose of every
business is to “create customers.” The only economic and social justification
for the existence of any business is to create customer satisfaction. The
importance of the customer and customer patronage per se is so profound. There
is need for greater understanding of the role played by the consumer in the
market place and the influence processes underlying this behavior. A good
branding strategy would lead to improved management decision rules and
patronage by the customers. It can potentially reduce incentives for investment
and innovation, and prevent new entry.
In the light of this intense competition presently in the
industry, the major challenge confronting all the mobile operators in Nigeria
is the determination and execution of various marketing initiatives by
promoting a brand name that would not only lead to attraction of new
subscribers, but also retention of the existing ones who would then become
loyal customers. It appears that there is an increasing relationship between
brand name adopted by GSM service providers and their effects on customer’s
patronage. That is why this study is designed to investigate the effects of
branding on Godfrey Okoye University students patronage of GSM service
providers.
1.3 Objectives of the study
This study seeks to assess
the popularity of GSM network among students of Godfrey Okoye University Enugu,
as well as the underpinnings of that popularity. It is guided by the following
specific objectives
i.
To determine the most patronized GSM network by students of
Godfrey Okoye University Enugu.
ii.
To determine whether brand name differentiate a GSM network
from others used by students of Godfrey Okoye University Enugu.
iii.
To ascertain if a brand name help in GSM network patronage by
students of Godfrey Okoye University Enugu.
iv.
To find out the effect of branding on the patronage of
telecommunication services by students of Godfrey Okoye University Enugu.
1.4 Research Questions
The following research questions were
formulated to guide the study
i. Which is the most patronized GSM network
by students of Godfrey Okoye University Enugu?
ii. Does brand name differentiate a GSM
network from others used by students of Godfrey Okoye University Enugu?
iii.
Does
brand name help in GSM network patronage by students of Godfrey Okoye
University Enugu?
iv.
What
are the effects of branding on the patronage of telecommunication services by
students of Godfrey Okoye University Enugu?
1.5 Research Hypotheses
Hypotheses are ideas, beliefs and
assumptions for guiding in a reasonable decision or conclusion. The study is
guided by the following hypothesis:
H1: There is no
significant relationship between company name and sales volumeof GSM services.
H2: There is no significant
relationship between brand image and sales volume of GSM services.
H3: There is no significant
relationship between corporate name and profitability of GSM service providers.
H4: There is no
significant relationship between brand image and Profitability of GSM service
providers.
1.6 Significance of the Study
It is expected
that the result of this research work would be useful to the following people:
management of GSM service providers, similar organizations, customers,
researchers and marketing practitioners in general. This work will help
management of GSM service providers and similar organization in formulating
policies which will improve their efficiency and lead to maximum satisfaction
of their customers. This is because the application of the findings of this
research in their establishments will encourage customers in the purchase of
their products.
The findings
of this work will no doubt add to the existing knowledge in the area of
marketing. It will also acquaint customers with the prevailing branding
strategies and also help them to understanding how variables such as quality,
and perceived societal status can influence consumer buying behaviour.
This study will help the present
marketing managers to better reposition their advertising strategy to capture
the correct target market to boost the sales in times where economy are at a
challenge.
It will also help researchers and
readers of this work to obtain a precise picture of how various brand names
affect the customers’ patronage and motivate them for further study on related
area.
1.7 Scope of the Study
This
research is delimited to Godfrey Okoye University Enugu. It is located at
Thinkers’ Corner near Emene, Enugu.
1.8 Limitations of the Study
The following are shortcomings of the
study.
i.
There
is a limited time to complete the study.
ii.
Paucity
of funds is another great challenge.
iii. Some students were reluctant to
participate in the study.
1.9 Definition of Terms
Brand Name:
This is a name given to a product by the company that produces or sells it. It is a specialized mark used to distinguish products from each other.
Customer: A customer (sometimes known as a client, buyer, or purchaser) is the
recipient of a good, service, product, or idea, obtained from a seller, vendor, or supplier for a monetary or other valuable consideration. (en.wikipedia.org/wiki/Customer).
Patronage: This is customers or the financial support from customers or guests. It is the
support or encouragement of a patron, as for an institution or causewww.yourdictionary.com › Dictionary Definitions
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