A STUDY OF THE EFFECT OF PROMOTIONAL STRATEGIES ON ADOPTING NEW PRODUCT

A STUDY OF THE EFFECT OF PROMOTIONAL STRATEGIES ON ADOPTING NEW PRODUCT

(A CASE STUDY OF JOS INTERNATIONAL BREWERIES)

CHAPTER ONE

1.0     INTRODUCTION

          Promotion is a form of corporate communication that use various methods of search a target audience with a certain messages in order to achieve a specific organizational goals and objectives.  Nearly all organizations, whether for profit or not-for-profit.  In all types of industries must engage in some form of promotion.  Such effects may range from multinational firm spending large sums on securing high-profit celebrities to serve as a corporate business cards at a local business person’s meeting.  Promotion gives insight on how effective and efficient in marketing organizational products.

1.1     BACKGROUND OF THE STUDY

          Like most marketing decision an effective promotional strategies requires the marketers understanding on how promotion fits with other prices of the marketing puzzle (e.g. product distribution, pricing target market). Consequently, promotion decision should be made with an appreciation for how it affect other areas of the company, for instance, running a major advertising campaign for a new product without first assuring there will be enough inventory to meet potential demand generated by the advertiser would certainly not go well with company’s production deparrment (not to mention other key company executive).  Thus, marketers should not operate in a vacuum when making promotion decision rather than overall success of a promotional strategy requires input from other impacted functional areas with other business areas. Individual promotion must also work together under the concept of integrated marketing communication, marketers attempt to develop a unified promotional strategy involving the co-ordination of many different types of promotional techniques, the key idea for the marketer who employs several promotional options (will be discuss potential options later in the project) to reach objectives for the products to employ a consistent message across all options in organization in order to market their products successfully, have to analyze their product in terms of it’s market price structure, distribution system or channel and promotional strategies.

1.2     HISTORICAL BACKGROUND OF JOS INTERNATIONAL BREWERIES PLC (J.I.B.)

          Jos International Breweries Plc (J.I.B.) came into existence in 1975 following a tripartite investment agreement signed between the following; The government of Plateau State of Nigeria, the Danish firm of ALs Cerekem International Limited and the industrialization fund for developing countries IFU.  The primary objective was to produce and market a high quality larger beer was to produce and market as well as provide the needed employment opportunities for the teaming youths.  J.I.B. Plc located in Jos the Plateau State Capital on a land area of over 25 hectres on the high Plateau and in the heart of Nigeria.  It commenced production on the premium larger known as Rock Lagar beer in 1979 with an initial installed capscity of 250,000 hostilities per annum within five years.  The success of Rock Lagar beer led to the introduction of another lagar beer called lagar beer and non-alcoholic beverage known as Matt Royale.  Following the success of the company, it diversified into four wholly owned subsidiary company namely: Pioneer Milling Company Limited (P.M.C.), Plateau Bottling Company Limited.  Due to the unfavourable economic policies of the then government of Nigeria in 1986, the company fortune divided and it divested from most of its subsidiaries except for PMC and Demco.  The company went into a brewing contract with Guinness Nigeria in 1992 to enable Guinness use the excess capacity of the company.  This was mutually terminated in 1995, the company went to the capital market twice to source cheap fund.  While the first was a failure, the second was a success which enable the company to refurnish and rehabilitate most of its obsolete equipment.  As part of its corporate responsibility, J.I.B. Plc sponsored the ROCK STRIKERS FOOTBALL CLUB from a mere division three venture which contributed greatly to the development of football in Nigeria.  Jos International Breweries Plc is producing high quality products and has over the year won several silver and gold awards from the Standard Organization of Nigeria (SON).

1.3     OBJECTIVES OF THE STUDY

          The purpose and aims of this research work will be stated as follows:

a.     To find out promotional tool employed in adopting the new product.

b.     To research on the possibilities and problems inherent in adopting a new product.

c.      To find out the problem of anything encountered in adopting a new product and what extent the company has been able to curtail such problems.

d.     To find out possible distribution channel of the product

e.      How promotion helps in fulfilling the production aim.

1.4     STATEMENT OF THE PROBLEM

          Problem identification is the first step to take when conducting any research work.  The statement of the problem is to identify if promotional strategies have any significant effect on the adoption of a new product.

1.5     STATEMENT OF HYPOTHESIS

Ho:    That the use of promotional strategies significantly affect adopting of new products.

Hi:     That the uses of promotional strategies insignificantly affect adoption of new products.

1.6     SIGNIFICANCE OF THE STUDY

          Due to the recent downward trend in the economy, an increase in population growth in recent time, some government policies relating to the promotion of goods and over reliance, external factors and promotion facilities have made it difficult and expensive for most firms and manufacturers to find the unique logic for promotional tool for their products and services effectively to the target customers.  The effort of this research work therefore is to suggest ways by arresting the problem which the company is facing as a result of an inadequacy in their promotional strategy system or practice.

1.7     SCOPE OF THE STUDY

          The scope of this research work will be the effect of promotional strategies in adopting new products.  Also the study will focus mainly on Plateau State being the immediate environment of the study.

1.8     LIMITATION OF THE STUDY

          A number of problems contributed to constraints in the process of completing this project work:  Lack of enough textbooks and journals on the subject under study, insufficient time, transportation and financial problems encountered by the researcher serve as a limiting factor for this project.

1.9     DEFINITION OF TERMS

EFFECT: The power to produce and outcome or achieve a result or something.

PROMOTIONAL: Any technique that pervasively communicates favourable message about a product to the potential buyers.

STRATEGY:  The process of planning something or putting a plan into operation in a skilled way.

ADOPTION:  The act of accepting with approval, favourable reception and option could be the appropriation (of idea or work etc) from another source.

PRODUCT:  Tangible and intangible attributes including financial, social and psychological utilities or benefits.