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TITLE PAGE

THE INCIDENCE OF BRAND LOYALTY AMONG CONSUMERS’ OF CEREAL FOODS

(A CASE STUDY OF PHINOMAR FOODS ENUGU)

BY

UDE FESTUS NWABUEZE

PG/MBA/08/47438

DEPARTMENT OF MARKETING FACULTY OF BUSINESS ADMINISTRATION UNIVERSITY OF NIGERIA, ENUGU CAMPUS

SUPERVISOR: DR. I.C NWAIZUGBO

MARCH, 2010.

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CERTIFICATION

This is to certify that this project was carried out by UDE

FESTUS NWABUEZE with registration number PG/MBA/08/47438

in the department of Marketing, faculty of Business Administration,

University of Nigeria, Enugu Campus.

This research work is an embodiment of original work

and has not be Submitted in partial or in full for any degree of this or

other University.

SINGED:

-----------------------------

DR. I.C. Nwaizugbo ---------------------------

(Project Supervisor) Date

DR. (Mrs.) G.E. Ugwuonah ----------------------------

(Head of Department) Date

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DEDICATION

This work is dedicated to Almighty God and my little boy Ugonna.

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ACKNOWLEDGEMENTS

My unalloyed gratitude- goes to God, my creator, for His abundant

grace in my life. My special thanks to my supervisor, Dr. I.C.

Nwaizugbo for his academic guidance and patience with me until the

completion of this work. I appreciate your kindness Sir. My appreciation

also goes to Professor Uche Modum; Dean of the faculty of Business

Administration, University of Nigeria, Enugu Campus and the H.O.D.

Department of marketing, UNEC Dr. (Mrs.) G.E. Ugwuonah. I will not

fail to thank my lecturers among who are Professor Julius O. Onah,

Professor Ike Nwosu, Professor (Mrs.) Nnolim, and Professor E.U.I.

Imaga. Dr. Mrs. Nnabuko, Dr. Ewurum, Dr. E.K. Agboeze, Dr.

Onwumere, Dr. Joseph I. Uduji, Chief J. A Eze, Mrs. G. Okpala, Mr.

S.N. Kodjo, Mrs. R.G. Okafor, Mr. C.B. Achison and others who were

all good to me in my academic pursuit. God bless you all.

I sincerely acknowledge the understanding and support of

my lovely wife; Obiageli, my mother Ogo .I also appreciate my children

and my colleagues in the office. May his banner be over us. Of course. I

cannot forget some of my course mate and friends whose

encouragement in one way or the other has kept me going in school.

Among whom are Mr. Leonard, Clement, Yusuf, Linus and many

others. Thank you all.

UDE FESTUS NWABUEZE.

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ABSTRACT

This research was concerned with the incident of Brand loyalty among

the

consumer of cereal foods in Enugu metropolis, using Phinomar Foods in

Enugu as case study.

Given the background of the problems the study sought to know the

existence and extent of brand loyalty among consumers of cereal foods,

to determine the influence of prices of the products on brand loyalty,

whether consumers perception of the attributes of the cereal foods

influence brand loyalty for particular brands and such attributes includes

thing as taste, Milk content sugar content dissolvability and nutritional

value and finally to ascertain the extent company image and brand name

influence brand loyalty. All the same, this study was restricted to six

popular brands namely; Cornflakes, Golden morn Soy pops, Cocopops,

White oat and Fruit Fiber.

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Further, among the objectives and significance of study was to

investigate the existence of brands loyalty among consumers of cereal

foods and to find possible solutions to the problems identified.

This work was accomplished through the use of questionnaire oral

interview, revision of previous work by different authors and the use of

Top man’s formula to determine the sample size (288) and analyzed the

findings by the use of Z-test method. At the end of the work it was

discovered that consumers are to a reasonal extent loyal to particular

brand, price, quality, products attributes, company’s brand name and

image exert a significant influence on the loyalty of consumers. Also

consumers have basic expectations in their favorite brands and are not

naïve as advertisers would want us to believe. The orders of importance

of the attributes to consumers are as follows: Nutritional value, Milk

content, Taste Dissolvability and Sugar content. Based on the findings it

was recommended that companies should focus on product quality and

integrated marketing communication (IMC) on popular already existing

brand names in the market. This will help sustainability of consumers’

loyalty.

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TABLE OF CONTENTS

Title Page: - - - - - - - - i

Certification: - - - - - - - ii

Dedication: - - - - - - - - iii

Acknowledgements: - - - - - - iv

Abstract: - - - - - - - - vii

CHAPTER ONE

1.0 Introduction: - - - - - - - 1

1.1 Background of study: - - - - - 1

1.2 Statement of problem: - - - - - 4

1.3 Objectives of the study: - - - - - 6

1.4 Research questions: - - - - - - 7

1.5 Hypothesis: - - - - - - - 8

1.6 Scope of the study: - - - - - - 9

1.7 Significance of the study: - - - - - 10

1.8 Limitations: - - - - - - - 11

1.9 Operational definition of Terms: - - - - 11

References

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CHAPTER TWO

Literature Review

2.0 Review of Related Literature: - - - - 14

2.1 Purchase decision making: A choice not change- - 14

2.2 Habit purchase and Brand loyalty: - - - 19

2.3 Models of Consumer Behavior and: - - - 23

consumer learning

2.3.1 The Marshallian (Economic) Model: - - - 24

2.3.2 The Pavlovian (Learning) Model: - - - - 25

2.3.3 The ferudian (Psychoanalytic) Model: - - - 28

2.3.4 Contingency Approach: - - - - - 29

2.4.5 Theoretical Framework: - - - - - 30

References

CHAPTER THREE

Methodology

3.1 Research design: - - - - - - 34

3.2 Source of data collection: - - - - - 34

3.2.1 The primary source: - - - - - 34

3.2.2 The secondary source: - - - - - 35

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3.3 Research Instruments: - - - - - 35

3.4 Population and simple size determination: - - 35

3.4.1 Population: - - - - - - - 35

3.4.2 Determination of simple size: - - - - 36

CHAPTER FOUR

4.1 Method of Distribution: - - - - - 39

4.2 Presentation Analysis: - - - - - 57

4.3 Test of Hypothesis: - - - - - - 50

CHAPTER FIVE

Summary of Findings, Conclusion and Recommendation

5.1 Summary of Findings: - - - - - 59

5.2 Conclusion: - - - - - - - 60

5.3 Recommendation: - - - - - - 61

Bibliography

Appendix

Questionnaire

CHAPTER ONE

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INTRODUCTION

1.1 BACKGROUND OF STUDY

Human behaviour is enormously varied and very complex and is

predicted on attitude, learning and habit. Consumers learn from past

experience and future behaviour is conditioned by such learning.

Marketers, the world over differ considerably in their prediction of

human behaviour.

The whole marketing effort is generally centered on the consumers. This

is implied in the marketing concept echoed by most markets which is

consumer satisfaction at a profit as the basis for successful marketing. In

their varied description of consumers as Theodore Levit (1960) puts it,

some people described consumers as unpredictable, varied, fickle,

stupid, shortsighted, stubborn and generally bothersome.

This does not however, in any way make the consumers less important.

Therefore the consumer is still of utmost consideration in the planning

of the marketing mix or any other marketing effort. Product branding is

one of such marketing effort. Products are branded for many reasons,

one of which is identification of the products. Today most of the

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products are purchased under some particular brand. This contrast with

what obtained when products were once considered simply as

commodities in the early days of marketing. Commodities or goods are

differentiated only by their uses and not by their suppliers. Today’s

marketers recognize that the total product is greater than simply the

physical good itself and believe that all goods and service can be

distinguished by their own unique qualities.

A products brand carries good deal of information, reducing or

eliminating the need to find out about a product before buying it.

Consumers confronted with a familiars brand have information about the

products images as promoted by the company. Even products that are

very similar are now considered distinguishable by brand. Consumer’s

perceptions of different brands of various product categories determine

to a large extent their buying pattern. However O’Shaughnessy, John

(1988) comments on the above claim that “different brands bought at

different times could reflect different occasions, temporary changes in

taste or family or wants rather than picking from a repertoire of brands

with indifference as to which brand is bought. Complete acceptance of

what O’shaushnessy advanced is accepting that their is no brand loyalty.

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If indeed, there is no brand loyalty, in the buying pattern of consumers,

then one of the main purpose of branding is defeated.

Other researchers are of the view that consumers gain experience in

purchasing and consuming products, they learn what brands they like

and do not like and the features they like most in particular brands. The

consumers adjust purchase behaviors based on past experience. The

existence of brand loyalty among consumers of a product or non-

existence of it thereof could depend on the extent of consumers covered,

the product under consideration and the approach employed in the

search for this important consideration is product marketing.

This study seeks to find out the existence or non existence of brand

loyalty among the consumer of cereal foods. The researcher is aware of

the fact that brand loyalty is an exhibition of consumer’s attitude to

products which is some what difficult to measure. However it is

believed that just as David Relbstein (1985) puts it, the buying pattern of

the product, and the proportion of purchase a particular brand bought are

indications of brand loyalty.

1.2 STATEMENT OF PROBLEM

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The cereal foods industry in the country is experiencing a continuous

increase in the number of brands competing for consumers income.

From the record of importation of white oat, fruit and fiber in the early

sixties as the only food cereals in the country, there has been a continual

increase in the number of cereal foods in the country. Today there are no

less than six different brands of cereal foods available in the market.

In those early days the beverage market was the seller’s market. Initially

it was white oat is the leading brand. But because it was imported as a

wholly finished product, it lost its position to corn flakes following the

ban placed on the importation of beverages at the beginning of the

Nigeria Civil war in 1967.

Corn flakes, the product of NASCO foods Nigeria PLC, dominated the

market for a long time. Consumers were multiplying, buying more of

the brand. However, more firms have continued to enter the market with

local plants each producing different brands of instant cereal foods. It is

therefore unrealistic for any company to rest on a mere assumption of

market leadership without considering the changing market share.

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In today’s factored market place, things like branding products and

markets share for instance no longer guarantee loyal customer. In one

case after another, the old established brands have been supplemented

by the rise of other brands. No single company can claim largest share

of any product market in a competitive environment. These days, the

idea of market share is a trap that can lull business people into a false

sense of security. Managers should wake up every morning uncertain

about the market place because it is invariably changing.

Companies should however not be caught in the excitement of selling

things just to increase their market share. As Regis Mckenna (1991) puts

its, the real goal of marketing is to own the market, not just to make or

sell products. Smart marketing means defining what of the whole pie is

yours. This is not just an issue of defining your market share. The

company should rather be sure what share of the market is loyal to their

product(s). Stopping at the idea of market share “turns marketing into an

expensive fight over crumbs rather than a smart effort to own the whole

pie.

Owning the market demands some responsibilities such as bringing into

your camp third parties who want to develop their own products, or offer

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new features or add-ons to argument your product. You get the first look

at new ideas that others are testing in the market, you attract the most

talented people because of your acknowledge leadership position.

This is why it has become necessary to investigate the existence or

otherwise of brand loyalty among the consumers of cereal foods drink in

Enugu metropolis.

1.3 OBJECTIVES OF THE STUDY

The research is basically directed towards the investigation of an

existence of brand loyalty among consumers of cereal foods. To this

end, therefore, the objectives of the study are to seek and possibly find

solutions to the problems identified above, the extent and basis of

consumer loyalty.

1. To determine the existence and extent of brand loyalty among

consumers of cereal foods drinks.

2. To determine the influence of price of the products on brand

loyalty.

3. To determine the extent consumers perception of the attributes of

the cereal food drinks influence brand loyalty for particular

brands. Attributes includes such things are:

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(i) Taste

(ii) Milk content

(iii) Sugar content

(iv) Dissolvability

(v) Nutritional value

4. To ascertain the extent company image and brand name influence

brand loyalty.

1.4 RESEARCH QUESTIONS

Based on the research objectives, we shall face with the following

questions:

1. Does the consumer of cereal foods drink in Enugu metropolis

loyal to particular brands?

2. To what extent does price of the brands influence loyalty to a

particular brand?

3. Does consumers’ perception of attributes or quality of the brands

influence loyalty?

4. What roles does company image and brand name play in the

promotion of loyalty to particular brands?

1.5 HYPOTHESIS

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The rationale behind this research was to determine the existence of

brand loyalty among consumers of cereal foods in Enugu metropolis.

For this reason, therefore the following hypotheses were made.

1. Ho: Cereal foods consumers are loyal to particular brands.

Hi: Consumers of cereal foods are not loyal to particular

brands.

2. Ho: Price is an important influence in the choice product brand

loyalty.

Hi: price is not an important influence in the choice product

brand loyalty

3. Ho: Company image and brand name contribute significantly

to consumers’ loyalty to particular brands.

Hi: Company image and brand name do not contribute

significantly to consumers’ loyalty to particular brands.

4. Ho: Consumers perceptions of the quality of the food drinks

have significant impact on brand loyalty.

Hi: Consumers perceptions of the quality of the food drinks

have no significant impact on brand loyalty.

1.6 SCOPE OF THE STUDY

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This study is restricted to Enugu metropolis in Enugu State of Nigeria.

The surrounding cities are (Uwani, Abakpa, Coal Camp, Achara-Layout,

Awkunanaw, Trans Ekulu, Independent-Layout and Iva Valley). The

rational was that Enugu was the capital of the defunct Eastern Region

which accounted for a substantial population of the food drink market in

Nigeria. Now the capital of Enugu State it is still very populous because

its cosmopolitan nature.

This strategic position of Enugu Metropolis in Eastern Nigeria is a fair

basis for moderate generalizations of the findings of this study for the

Nigeria cereal foods market. Nevertheless, brands of cereal food drinks

covered include:

1. Corn Flakes

2. Golden mourn

3. Soy pops

4. Coco pops

5. White (quicker) oats

6. Fruit & Fiber.

1.7 SIGNIFICANCE OF THE STUDY

The percentage of consumers of cereal foods continues to drop as the

economy becomes tougher and general financial melt down continue to

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increase the poor performance of companies. Brand loyalty therefore

becomes important in the managerial areas of marketing mix and market

research. This study will therefore be of immense significance to firms

in the industry in the area of manipulation of their market share, price

changes of products, investment in research and development and

improvement on the quality of the products.

The various positions of the brands in the perception of the consumers

will emerge and enable them to assess their relative position as leaders,

followers and niches in the industry.

The study will also be of great benefit to the advertising agencies, the

print and electronic media whose input in the promotion of those

products depends so much in the market position of the product.

Also to benefit from this study are companies seeking to introduce new

products. With the identification of existence of brand loyalty or not

among consumers and the factors contributing to it, the company can

now find out a suitable unique selling proposition (USP) to use and

appeal to their desired target market. This will also enable them decide

whether to enter the market competing with the leaders, challengers, or

be a follower or even niches in the industry.

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Finally the study will also be of great benefit to distributors and retailers

who will be opportune to know the popular brands by the consumer’s

assessment and take advantage of it in stocking their inventory.

1.8 LIMITATIONS

This study is restricted to Enugu metropolis and since brands loyalty is

an attitude and behavioral measurement, the findings cannot be

generalized to other environments which might be influenced by other

factors in their environment.

The researcher also will choose the samples for the survey on the

assumption that the brand choice of the cereal foods purchased were

made by such respondent.

1.9 OPERATIONAL DEFINITION OF TERMS

(A) CEREAL FOODS:

These are all members of the monocotyledonous family grain

crops such as maize, wheat barley, rice, oats, rye and sorghum.

(B) METROPOLIS:

Major or chief city of a state or country in other words a capital.

(C) COSMOPOLITAN:

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From many part of the world.

(D) CONSUMERS:

These are people who make use of the product directly.

(E) BRAND:

A term use to differentiate or identify a product from the same

product class.

(F) BRAND Loyalty

This implies continuous patronage or consummation of a

particular product all the time. It gives sellers some protection

from competition and greater control planning their marketing

mix.

(G) CITY

This implies a concentration of people in a geographic area who

can support themselves from the city’s economic activities on a

fairly permanent basis.

REFERENCES

Adrika E.O et al (2001) Principles and Practice of Marketing 2nd Ed.

(John Jacob’s classic Publisher LTD. Enugu.

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David J. Rubsterin (1985) “Marketing Concepts, Strategies and

Decisions, (Englewood cliffs, prentice Hall Inc.) pp 284 – 285.

John Oshaughnessy (1988). Competitive Marketing 2nd Edition,

(London: Bridles Ltd Guilford and King Lyn) P.109

Reges Mickenna (1991), Marketing is everything Harvard Business

Review (Pager back no. 90087) P.8

Theodore Levit (1960), Marketing myopia, Harvard Business Review

(July-August) p.60.

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CHAPTER TWO

2.0 REVIEW OF RELATED LITERATURE

2.1 PURCHASE DECISION MAKING: A CHOICE NOT

CHANGE

A lot of marketing efforts over the years are channeled towards

unraveling of what goes on in the buyers black box. Researchers have

explored factors that determine the choice of a particular information

processing strategy. Prominent among them Rowlay J, Daves (2000)

proposed that the eventual strategy employed is upon characteristics of

the consumer, the market place, the social environment and the physical

environment. Though they vary in details, there are five stages which

consistently occur; problem recognition, information search, evaluation

of alternative/brand evaluation, purchase decision and post purchase

behaviour. Henry Assael (1993, p.25-42) outlined the details of the

processes the consumer passes through at each stage. The first stage of

the traditional decision model in the need arousal stage and this

describes the consumers state of mind which in the ‘psychological set’

toward the prospective purchase. Consumer’s psychological set is based

on the product benefit and his attitude towards the various brands.

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The hierarchy of effects model of decision making shows that the

consumer goes through sequential stages involving ‘thinking’ (belief)

feelings (evaluation) and ‘action’ (the intention to buy the brand). Also

important in the buyers psychological set is the benefit criteria. This is

important in deciding which brand to buy. Depending on the product

class, there are various attributes which consumers conceive important.

For example in;

Beer – Taste, alcohol content and price, foaming, price,

Toot paste- Taste, foaming, price, dental protection, (fluoride content)

and colour.

Powered milk – dissolvability, taste, price, conge ability.

Cereal food drink – milk and sugar content, dissolvability nutritive

value, taste and price. Non-alcoholic soft drink – Taste, price, brand

name.

Need recognition produces the consumer to embark on information

search and this involves exposure, Organisation and search for

information. Consumer information search varies directly with the

extent of consumer involvement and the consumers attention to the

marketing stimuli-which has to receive attention, be comprehended and

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retained in memory to be able to affect consumers psychological set.

The consumer first recognizes the whole information and chooses the

one related to his particular need. The message having been understood

is interpreted to agree with their beliefs. However the consumer chooses

to retain only those things that are considered important to him in the

need satisfaction. There may or may not be any need for further

information search. Brand evaluation is a direct consequence of

information search. Various brands are associated with different benefit

criteria and consumers will choose brands considered to offer those

benefit. The consumer evaluates the brands based on his/her priority of

desired benefits and relates the brand characteristics to these benefits.

The outcome of brand evaluation is the intention to buy. The final

sequence in the complex decision making model is purchasing the

intended brand, evaluating the brand consumption and storing this

information in the psychological set.

The extent of cognitive effort expended in the decision making process

depends on the level of involvement of the product. According to Assael

(1993), high involvement products are those that are important to the

consumers, products that are “closely tied to the consumers, ego and self

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image” and involve some reasonable amount of risk to the consumer.

Low involvement purchase is one where the consumer does not consider

the product sufficiently important to his / her belief system and does not

strongly identify with the product. Most purchase decision is low in

consumer involvement and as such does not involve cognitive effort in

making a choice of the brands.

One cannot say yet if cereal foods are low involvement or high

involvement product. But because only a small portion of income is

expended on them and because there seem to be little functional

differences in the brands the indication is that it may not be high

involvement product. The study by Benett, R. and Rundle Thiele, S.

(2005) reveal that consumers level of involvement with a product

depends no t just on risk of wrong choice, amount of income spent or

even uncertainly about the product but also on product importance to the

particular consumer, interest, value and emotions. The above line of

thought therefore implies that it may not only be the proportion of

income or risk that classifies a product as low or high involvement one

but other things such as interest and emotion could play vital roles.

Product involvement could be situational or enduring depending on the

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emotional attachment of the consumer to the product. Both situational

and enduring involvements are likely to result in complex decision

making. This is why Celis and Oslon (1988) argue that emphasis should

be on the product itself and the inherent satisfaction, its usage rather

than on some situational goals. Thus cereal foods can by all implication

be a high involvement product for some families, but whether it is low

or high is level of involvement; emotional attachment and interest can

still lead to a complex decision making process. This is true for most

product categories.

Finally, the ‘valence’ refers to the preference for attaining one outcome

over another. Thus valence implies that there exist for the individual

consumer, a meaningful preference hierarchy. The argument though is

that this may not apply to low involvement products earlier discussed.

The controversy of involvement not withstanding, there is no doubt that

before making a choice of a particular brand from alternatives brands,

the aroused consumer becomes alert to or sometimes actively searches

for information bearing on his need and its gratification.

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2.2 HABIT PURCHASE AND BRAND LOYALTY

Habit purchase in repeat purchase of a product due to consumer

learning. According into Assael (1993) habit purchase is the opposite of

complex purchase decision making. In his opinion a consumer finds

little need for evaluating brand alternatives and prior satisfaction with a

brand leads to repeat purchases. Oslon however believes the contrary

about the level of decision making involved in habit purchase. He

opined that even when little consideration is given to other brands,

cognitive activity must occur; decisions have to be made about where

and when to purchase the product, some knowledge of the product and

its availability must be activated from memory. The implication of this

therefore is that no purchase decision is really a chance.

Several authors differ in their opinion of consumer’s exhibition of habit

purchases. These authors describe the habit purchase patterns as brand

loyalty, or brand commitment. Assael defines brand loyalty as repeat

purchase/buying because of commitment to a certain brand. There has to

be a level of commitment for a consumer to be brand royal. Inertia on

the other hand is developed habit purchase due to consumer passive

learning especially for low involvement products as developed by

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Krugman. In a simple illustration using mortion salt, the author

describes a consumer response to the salt advertisement initially, as the

consumer is exposed to the advertisement there is no evaluation of the

advertisement since the consumer is not highly involved. However,

overtime, due to repeated exposure, the consumer begins to associate

some pieces of information picked up casually and stored in the

information set with the salt. The consumer may therefore repeatedly

buy mortion salt not because of commitment to be brand royal but were

familiarity and acceptance.

Another author, described “Brand loyalty as the biased (i.e. non random)

behavioural response is purchase expressed overtime by some decision

making unit with respect to one or more alternative brand out of a set, of

such brand and includes a strong positive attitude toward the brand.

Brand commitment on the other hand is defined “as

emotion/psychological attachment to a brand within a product class. The

author considers Brand royalty more of repeat purchase behaviour and

different from brand commitment. This contrasts with Assael’s approach

of considering brand commitment as a basic ingredient of brand loyalty.

In this study however, the researcher is focusing on brands loyalty as a

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combination of brand commitment and /or inertia leading to repeat

purchase behaviour.

Another important consideration is the question of whether brand loyalty

is a behavioural and/or attitudinal concept. The behavioural theorists

believe that brand loyalty is repeat purchase behaviour with or without

commitment. Some other authors like London (1993) et al Peter Oslon

and Leon Schiffman (2000) et al agree that brand loyalty is summarily

described by repeat purchase behaviour. Repeat purchase behaviour is

assumed to reflect reinforcement and a strong stimulus – to – response

link. These researchers take the approach that uses probalistic models of

consumer learning to estimate the probability of a consumer buying the

same brand again given a number of past purchases of that brand.

However, what people do, does not say anything about why they dos it.

This is why the cognitive learning theorists believe that repeat purchase

and frequency of purchase or even proportion of total purchases lack

precision since they do not distinguish between real brand loyal buyer

who is intentionally faithful and the spurious buyer who repeats a brand

purchase because it is the only one available or affordable.

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The argument of the cognitive approach to brand loyalty is that mere

repeat purchase can not be synonymous with consumers who are

emotionally committed to a product. Day recognizes that consumers

might continue to buy the same brand because other brands are not

readily available, or a brand offers a long series of price deals, or the

consumer wants to minimize decisions making. In a study where

behavioural measures alone were used in predicting brand loyalty, over

70% of the sample would have been defined as brand loyal, but adding

the attitudinal component reduced the proportion of brand loyal

consumers to less than 50%.

Assael still argues that the measurement of brand loyalty based on past

behaviour may be misleading. In his example, the consumer may buy

one brand of soypops for personal consumption, another brand for the

spouse and occasionally a third higher priced brand to have around the

house for quests. This consumer may be highly loyal to the preferred

brand but this is a multidimensional concept that must incorporate the

consumer commitment to the brand. The very term loyalty implies

commitment rather than just repetitive behaviour which suggest that

there is need for a cognitive as well as a behavioural concepts. Even

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behavioural theorists of brand loyalty concedes that there is a need for

attitudinal measure. This is clearly seen in O’Shaughnessy’s argument

on measuring brand loyalty. The appropriate description includes both

behavioural and attitudinal views. This is therefore the line of thought

and basis of this study.

2.3 MODELS OF CONSUMER BEHAVIOUR AND

CONSUMER LEARNING

Consumer behaviour can be defined as those acts of individuals directly

involved in obtaining and using economic goods and services including

the decision process that precede and determined these act or as the

buying habits or patterns of behaviour of consuming public either in

general or in specific groups. Brand loyalty an aspect linked to some

behavioural models and learning theories. A closer look at the concepts

and marketing implications of these consumer behavioural models and

learning theories will shade some light of Understanding developing and

sustaining brand loyalty.

Kotter (1991) has identified five behavioral models for analyzing buyers

namely;

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The Marchallian (Economic) model, the Pavlovlan (Learning) model,

the Freudian (psycho-analytic) model, the Veblenian (Social

psychological) model and the Hobbessian – (Organisation factor) model.

Only the models considered relevant to the concept of brand loyalty will

be discussed.

2.3.1 THE MARSHALLIAN (ECONOMIC) MODEL

This model proposes that purchasing decisions are the results of largely

rational and conscious economic calculations. The consumer seeks to

spend his income on those goods and services that will deliver the

greatest utility according to his taste and relative prices. This he does by

carefully calculating and weighing the expected pains and pleasures of

every contemplated action. Thus he is always trying to maximize

satisfaction with his limited resources. The factors that influence the

consumer therefore are likely to be price, income and durability. And

obvious deduction from this model is that a man faced with two brands

of instant cereal foods which are identical in all respect would definitely

buy the cheaper brand. This consumer can only buy the brand that costs

more if and only if the later has any attribute or quality which justifies

the extra expenditure on it. This is purely an economic consideration and

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does not take into recognition any other psychological variable which

may motivate the consumer to buy the more costly brand even when

their perceived attributes are the same.

Some assumptions from this model include.

1. The lower the price, the higher the sales and vice versa.

2. The lower the price of a substitute A, the lower the sales of B

and vice versa. However, economic considerations alone

cannot explain the behaviour of the consumer.

The assumption from this model implies that an increase in price will

lead to a fall in sales. This is not always the case and this is why the

model is criticized for ignoring the fundamental questions of how

product preferences are formed. The other mysteries involved in

consumer choice and not taken into consideration rather.

2.3.2 THE PAVLOVIAN (LEARNING) MODEL

This model which comprises of classical and instrumental conditioning

was pioneered by Pavlov, a Russian psychologist who performed

experiments on dogs. The model is based on the conditioned reactions of

dogs to bells rang before they were fed. A variant of classical

35

conditioning was instrumental conditioning by B.F. Skinner who

introduced an aversive stimuli of electric shocks to the food bell

response of the dog. Both Parlov and skinner concluded that learning is

an associative process based on four learning concepts.

a) Drives: Motives or Needs: These refer to strong internal

stimuli or dissatisfaction to the individual which impels action

b) Cues: These are weaker stimuli in the environment and/or in

the individual which determine when, where and how the

subject reacts. For example, a food drink advertisement can

serve as a are because it stimulates the thirst drive in a

housewife. But her response will depend on this cue and other

cues-time of day and cues intensity.

c) Response: This is the persons reaction to the configuration of

cues. It depends on the degree to which the experience is

rewarding that is drive reducing.

d) Reinforcement: If the experience is rewarding, a particular

response is reinforced or strengthened, and there is a tendency

for it to be repeated when the same configuration of cues

appear again. Otherwise, the response is not reinforced and

36

the strength of the habit diminished and may be extinguished

eventually.

He therefore hypothesized that the consumer does not have to

be rational in all his purchase decisions. There is rather a

greater tendency for the consumer to purchase by habit. This

is a direct contrast of the Marshallean model of the economic

rational man.

There are many marketing implications of this model. There

is a need for strong cues (such as free samples, advertisement)

in the food drink market and other such products where

competition is keen. However, sufficient product quality is

necessary to serve as reinforcement and to build up habit in

the consumers. Firms introducing new brands can as well

identify those cues that have helped in building up such brand

preferences since consumers are likely to transfer allegiance

to similar brands.

Again the model provides justification for repeat advertising

to generate repeat purchase and fight dissonance. It also

provides useful guidelines to advertising practitioner and copy

writers by helping to identify product drives that must be

37

emphasized. In food drinks for instance, drives like “vitality

and thirst” may be suggested as strong related drives.

2.3.3 THE FREUDIAN (PSYCHOANALYTIC) MODEL

Sigmund Freud, based on his study on child behaviour,

hypothesized that a child enters the world with instrumental needs that

cannot be satisfied by the immediate environment. According to him,

the mind consists of three parts namely.

1. The Id- houses the basic instruction drives, most of them, anti,

social.

2. The Ego-a conscious, rational control centre that maintains a

balance between the uninhibited instincts of the Id and social

oriented super ego.

3. The super Ego-the conscious, accepts moral standards and

directs instinctive drives into acceptable channels.

The basic implication of the above model to marketing is that the real

motive of a consumer for buying a specific product or brand may well

be hidden. Manufacturer should provide enough social rationalizations

for product purchase and present brand appeals directed to the sub-

conscious, to the consumers’ dreams, hopes and fears.

38

2.3.4 A CONTINGENCY APPROACH

The above models clearly show that there is no single explanation for

certain consumer behaviour. In buying a product, the consumer seeks to

satisfy a variety of needs, psychological, social, physiological and even

spiritual needs. In any case the development of brand loyalty as a pattern

of consumer behaviour could arise from rational or irrational purchase

decisions.

It is possible that in one case a consumer purchase out of habit those

products perceived to posses the highest utility value based on his

limited resources. It is also possible that the consumers preference is a

complex function of the Lewinian dictum B = F (P, E), meaning that

behaviour is a function of the interruption of the person P with

environment E. The expectancy model’s implicit assumption of a value

structure as a description of P and a belief structure as an environmental

measure of E can no longer be accepted as adequate in explaining

consumer behaviour.

Other evidences now abound that there are significant influence of

psychological variables in the behavioural pattern of the consumers.

Therefore a cheaper understanding of consumer behaviour requires a

39

combination of both conscious rational hypothesis and the psychological

related hypothesis

2.4.5 THEORETICAL FRAMEWORK

Consumers will repeatedly buy what satisfies them. The satisfaction thus

obtained is reinforcement and increases the probability of repurchasing.

Thus habit purchasing pattern is developed. Most brands in different

product categories enjoy a degree of loyalty. This is not just buying due

to resignation. But could rather be associated with commitment and

prior satisfaction with the brand.

In the study by Blatterg identified for types of loyalty segment using

proportion of purchase.

1. High National Brand Loyal: These groups of consumers are

loyal to one brand. Over 90% of all purchases are developed

to this brand.

2. National Brand Loyal: These segments also are developed to

one brand but degree of loyalty is not as high as 90%.

3. Private Label Loyal: Consumers in this group are loyal to a

private label and most likely purchased from a particular

40

store. Hence private label loyal customers are also store loyal

consumers.

4. Last Purchase Loyal: These consumers buy one brand on

successive occasions and switches to another after which he

switches to yet another brand.

On the other hand George H. Brown (Kotler 2002), buyers can be

divided into four groups:

1. Hard Core Loyals: Always buy the same brand.

2. Split loyals: Loyal to two or three brands.

3. Shifting Loyals: Loyal to one brand for a period of time, but

easily shifting from one brand to another, due to certain

advantages offered by the new brand.

4. Switches: Show no loyalty to any brand, switching the brand

with almost any buying situation.

Both Blatterg, and Brown classification reflect behavioural measures

of loyalty. Such classifications as a matter of fact could leave us with

the conclusion that most consumers are loyal to a particular brand

even in this study of food drinks which is more appropriately

classified as a low involvement product.

41

REFERENCES

Benett, R. Rundle – Thiele, S. (2005). The Brand Loyalty Life Cycle

Implication for Markets, Journal of Brand Management Vol.12

No.4

Henry Assael (1993) Consumer Behaviour and Marketing Action. 4th

ed. Boston Kent pp 25-52

Kotler P. (1991), Marketing Management Analysis, Planning,

Implementation and Control 6th ed. Englewood cliffs. N.J Prentice

Hall Inc. pp. 262- 263

Kotler P. (2002) Marketing Management, Melenium Edition, Prentice

Hall Inc. Upper Saddle River, New Jerssey

Kunde J. (2002) Unique Now or Never: the Brand is Company Driver

in the New Value Economy, Financial Time Prentice Hall London

Leon G. Schiffman and Leslie Lazar Kanuk (2002), Consumer

Behaviour 6th ed. India Prentice Hall Inc. October p. 195

Richard Celsi and Jerry C. Oslon (1988) The Role of Involvement in

Attention and Comprehensive Process, Journal of Consumer

Research 15 September pp. 210-224

Rowley J. Daves (2000), Disloyalty. A Closer Look at

Non Loyal, Journal of Consumer Marketing Vol. 17 No.6.

42

Wale Alabi (2010), Royalty programmes; Rewards without connection.

The Nation 29 January P. 23.

43

CHAPTER THREE

METHODOLOGY

3.1 RESEARCH DESIGN

This chapter shows the systematic, formal, technical ways or steps

adopted by the researcher in his research work. It is an axiom that two

persons can research on a particular subject but view it from different

perspectives and approaches. Thus this research work involves the

qualitative and analysis from both the primary and secondary data.

3.2 SOURCES OF DATA COLLECTION

The source of data for this research work consists of both primary and

secondary.

3.2.1 THE PRIMARY SOURCE

This is data collected on non-existed information

or record. Infarct it is raw data.

44

3.2.2 THE SECONDARY SOURCE:

This is data from already existing events or written and recorded or

unpublished.

3.3 RESEARCH INSTRUMENTS

Major instruments used in this research work were questionnaires and

oral interview.

QUESTIONNAIRE: These were designed and administered for

purpose of conducting the research. The questionnaire was structured to

illicit information aimed at finding out brands of food drinks under

study. The questionnaires was concentrated on consumers in such areas

as Uwani, Abakpa, Coal Camp etc, that does not mean that

questionnaires were not administered to consumers outside these areas.

ORAL INTERVIEWS: Since it would have been unreliable for the

purpose of this work to design only a questionnaire as instrument of data

collection. Due to this reason, oral interview was also used.

3.4 POPULATION AND SIMPLE SIZE DETERMINATION

3.4.1 POPULATION

The targeted populations in Enugu metropolis include all adults who

take food drinks. This includes housewives, students, bachelors and

45

spinsters who play a definite role in the purchase of the food drinks

consumed in their homes.

3.4.2 DETERMINATION OF SAMPLE SIZE

The fact that the information for this research study is from Enugu

metropolis and the population is too large which cannot be exhaustive.

The researcher decided to adopt pilot survey to arrive at the sample size

for the consumers.

In pilot survey conducted by the researcher 20 questionnaires were

distributed and out of which 15 were correctly filled and returned hence

regard as positive response. The remaining 5 were not returned. This

gives 75% for the returned questionnaires and 25% for the rejected ones.

TO CALCULATE THE SAMPLE SIZE- TOPMAN’S

FORMULAR IS USED: -

n = Z2 Pq

E2

Where n = Sample size

z = Standard deviation for desired level of confidence

(1.96)

46

p = probability of positive response

q = probability of negative response

e = 5%, the limit of tolerable error

Therefore:

n = Z2 Pq

E2

n2 1.962 (.75 x .25)

0.052

= 3.8416 x .0.1875

0.0025

= 0.7203

0.0025

= 288.12

= 288

TEST TECHNIQUES

In testing the hypothesis in this research work zt method was used. This

enables the researcher to arrive at a significance result.

z = x - np

np (1 – p)

47

Where

x = Respondent Ho

n = sample size

l = Level of significance (5%)

p = probability for Ho acceptance (0.05)

Note level of significance = 0.05 or 1.65

48

CHAPTER FOUR

DATA ANALYSIS AND DISTRIBUTION

4.1 METHOD OF DISTRIBUTION ANALYSIS

The data being presented here were collected from primary source

through questionnaire.

A total of 288 copies consumer survey questionnaire were administered

in the field survey out of which 278 were returned representing a

response rate of 96.5%, while 10 representing. 3.5% did not return their

questionnaire. However out of the number of questionnaire returned 8

questionnaires representing 2.9% could not pass the validity test after

editing. This either because of non-completion or contradictory

information. Thus we were left with 270 valid questionnaire

representing a usage rate of 97.1%

49

TABLE 4.1

CONSUMERS QUESTIONRE DISTRIBUTION IN ENUGU

METROPOLIS.

PLACE CONSUMERS PERCENTAGES

Uwani 40 13.9

Abakpa 40 13.9

Coal Camp 35 12.2

Achara Layout 35 12.2

Awkunanaw 33 11.5

Trans Ekulu 40 13.9

Independent Layout 40 13.9

Iva Valley 25 8.7

Total 288 100

Source: Field survey 2009

Table 4.1 shows that out of 288 consumer questionnaire, 13.9% each

were distributed in the four cities (Uwani, Abakpa, Trans Ekulu,

Independent Layout), while 12.2% were distributed to consumers in

Coal Camp Achara layout respectively. However, 11.5% and 8.7% were

distributed to consumers in Awkunanw and Iva valley.

50

TABLE 4.1.2

RESPONDENT RATIO OF SURVEY QUESTIONNAIRE

Total No of Number PERCENTAGES

Questionnaires 288 100

Returned 278 96.5

Unreturned 10 3.5

Source: Field Survey 2009.

Table 4.1.2 shows the respondent questionnaire distributed, 96.5% out

of 100% questionnaire distributed were filled and returned.

TABLE 4.1.3

USAGE RATIO OF SURVEY QUESTIONNAIRE

Number PERCENTAGES

Accepted 270 97.1

Rejected 8 2.9

Total 278 100%

Source: Field Survey

Table 4.1.3 shows the usage ratios of survey questionnaire, 97.1% of the

questionnaire were accepted, while 2.9% were rejected.

51

4.2: PRESENTATION ANALYSIS

TABLE 4.2.1:

RESPONDENT WHO TAKE CEREAL FOODS IN THEIR

HOME.

Source: Survey 2009

The response of those who take cereal foods, (100%) of consumers

indicated that they take cereal foods in their home. This shows that this

item is virtually found in every home.

TABLE 4.2.2:

RESPONDENT STATUS IN THE FAMILY.

Status Frequency Percentages

Husband 60 22.22

Wife 100 37.04

Daughter/son 70 29.63

House help 30 11.11

Total 270 100

Source: Survey 2009

From table 4.2.2 above, the majority of the consumers were wives,

which represent (37.04%). Others in the family status were

Frequency Percentages

Yes 270 100

No - -

Total 270 100

52

Daughter/son (29.63%), the next were Husbands (22.22%), while

(11.11%) represents house help.

TABLE 4.2.3

RESPONDENT BRAND LOYAL/SWITCHERS OF CEREAL

FOODS?

Frequency Percentages

Yes 190 70:37

No 80 29.63

Total 270 100

Source: Survey 2009.

Table 4.2.3 shows that great number of consumers interviewed agreed

that they are brand loyal to a particular brand of cereal foods represents

(70:37%).Which means; there were consumers who were committed to

the consumption of a particular brand. However, (29.63%) could go to

the market or shops to purchase any brand that is affordable.

TABLE 4.2.4:

RESPONDENT BRAND PREFERENCES.

Brands Frequency Percentages

Corn Flakes 90 33.33

Golden morn 60 22.22

Soy pops 50 18.52

53

Coco pops 30 11.11

White Oat 20 7.41

Fruit & fiber 20 7.41

Total 270 100

Source: Survey 2009.

The above result on the brand consumers would preferably buy,

(33.33%) indicated cornflakes giving a large proportion of consumers of

cereal foods, the next is (22.22%) representing Golden morn and

(18.52%) for soy pops, (11.11%) preferred cocoa pops, (7.41%) each

represents white Oat and fruit-fiber.

TABLE 4.2.5

RESPONDENT WHO AT TIMES SWITCH TO OTHER BRANDS

Frequency Percentages

Yes 270 100

No - -

Total 270 100

Source: Survey 2009.

From table 4.2.5, the result shows that, (100%) of consumer could

switch to other brands of cereal foods.

54

TABLE 4.2.6:

REASONS RESPONDENT SWITCH BRAND SOMETIMES

Frequency Percentages

Price of the product 165 61.11

Lack of the product 70 25.93

Others 35 12.96

Total 270 100

Source: Survey 2009.

From table 4.2.6 above, the highest percentage among reasons

consumers switch brands is the product price which represents

(61.11%). This implies that most of the consumers were price sensitive

and this can influence them a lot. Other influences are non availability of

the brand (25.93%) and others (12.96%).

TABLE 4.2.7:

RESPONDENT CHOICE OF BRANDS AT EQUAL PRODUCT

PRICES

Brands Frequency Percentages

Corn Flakes 100 37.04

Golden morn 55 20.37

Soy pops 55 20.37

Coco pops 40 14.81

White Oat 15 5.56

Fruit & fiber 5 1.85

Total 270 100

Source: Survey 2009.

55

From the response on which brands they will buy if prices were the

same, (37.04%) of consumers indicated that they would buy cornflakes,

(20.37%) for Golden morn and soy pops respectively and for others

some indicated cocoa pop (14.81%) and white Oat (5.56%).

TABLE 4.2.8:

OBSERVED PERCEPTION OF RESPONDENT

Frequency Percentages

Yes 220 81.48

No 50 18.52

Total 270 100

Source: Survey 2009.

From the table 4.2.8, the consumers who said that their choice of cereal

foods depend on perceived attributes of the brand were (81.48%). But

for those who have no knowledge of product attributes as a result of

their level of literacy were (18.52%).

56

TABLE 4.2.9

RESPONDENT WHOSE CHOICE WERE INFLUENCED BY

CEREAL FOODS ATTRIBUTES

Attributes Frequency Percentages

Milk content 70 25.93

Taste 60 22.22

Sugar content 20 7.41

Dissolvability 30 11.11

Nutritional value 90 33.33

Total 270 100

Source: Survey 2009.

From the table above, consumers were also interviewed on which

attributes determines their choice of brand. The result of the analysis

shows that Nutritional value was their most preferred attributes

(33.33%) Similar to this, mentioned milk content (25.93%), and Taste

(22.22%). Other issues mentioned by them include dissolvability

(11.11%) and sugar content (7.41%).

57

TABLE 4.2.10:

THE EXTENT TO WHICH COMPANY’S IMAGE INFLUENCED

CHOICE OF CEREAL FOODS.

Frequency Percentages

Very strongly 75 27.78

Strongly 65 24.07

Slightly 65 24.07

Very slightly 65 24.07

Total 270 100

Source: Survey 2009.

From the table 4.2.10, the response on the influence of image of the

company (27.78%) of consumers indicated very strongly that company’s

image and brand name influence their choice of cereal foods. (24.070)

for strongly to very slightly. As long as the company maintains her

corporate image and brand name the choice of their product will prevail

above others.

TABLE 4.2.11:

RESPONDENT CHOICE OF CEREAL FOODS BASED ON QUALITY.

Frequency Percentages

Yes 180 66.67

No 90 33.33

Total 270 100

Source: Survey 2009.

58

From table 4.2.11 above, the analysis of data shows that (66.67%) of

consumer were influenced by quality in the choice of the brand. As long

as the company is quality conscious of the brand of their product, the

company will maintain a good percentage market share and this is an

added advantage to the existence of the company. However, (33.33%)

does not perceive quality in the choice of their brand.

TABLE 4.2.12:

RESPONDENT LEVEL OF INCOME.

Income level Frequency Percentages

Low income 60 22.22

Middle income 95 35.19

Upper income 115 42.59

Total 270 100

Source: Survey 2009.

From the response on the level of income, (42.59%) of consumers were

of upper income earners, followed by those in the middle income

(35.19%) and few of low income earner (22.22%) this may be associated

with their level of hierarchy of need which is solid foods.

59

TABLE 4.2.13:

RESPONDENT LEVEL OF EDUCATION

Qualification Frequency Percentages

B.Sc and above 45 16.67

HND 45 16.67

OND/NCE 46 17.64

GCE/SSCE 50 18.52

Primary six/others 84 31.11

Total 270 100

Source: Survey 2009

The result of the analysis reveals that consumers sees cereal foods as

instant food that add nutritional value and vitality to the body and

energy build up. The percentage recorded shows (31.11%) of respondent

attained primary six. A reasonable percentage hold GCE/SSCE

(18.52%), next on the table were holders of OND/NCE (17.04%), while

(16.67%) for HND and B.Sc Certificates.

4.3 TEST OF HYPOTHESIS ONE

Ho: cereal food consumers are loyal to particular brands

Hi: Consumers of cereal foods are not loyal to particular brands.

60

Z = x – np

np (I – p)

Where x = Respondent Ho (190)

n = Sample size (288)

p = Probability for Ho acceptance

(0.50)

= Level of significance (0.05) or 1.65

DECISION RULE

Accept Ho if the Z is greater than zt. Otherwise reject Ho.

SOURCE OF TEST QUESTION 4.2.3

Frequency Percentages

Yes 190 70.37

No 80 29.63

Total 270 100

From the result, those who support null-hypothesis has 70.37%

response, therefore the test is shown below

Z = 190 – 288 (0.50)

288 x 0.50 (1 – 0.50)

61

= 46

72

= 46

8.49

Calculated value = 5.42

DECISION TAKEN

Since calculated value (z) is greater than table of value (zt) 5.42 > 1.65

accept Ho, which means that cereal foods consumers are loyal to

particular brands.

TEST OF HYPOTHESIS TWO

Ho: Price is an important influence in the choice of product brand

loyalty.

Hi: Price is not an important influence in the choice of product brand

loyalty.

Z = x – np

np(I – p)

Where x = Respondent Ho

n = Sample size (288)

P = Probability for Ho acceptance (0.50)

62

= Level of significance (0.05) or 1.65

DECISION RULE

Accept Ho if Z is greater than zt. Otherwise reject Ho.

SOURCE OF TEST QUESTION 4.2.6

Frequency Percentage

Price of the Product 165 61.71

Lack of the Product 70 25.93

Others 35 12.96

270 100

From the table, those who support null hypothesis has the highest

percentage response of 61.71% therefore the test is shown below

Z = 165 – 288 (0.50)

288 x 0.50 (1 – 0.50)

= 21

72

= 21

8.49

63

Calculated value = 2.47

DECISION TAKEN

Since calculated value (z) is greater than table of value (zt) 2.47 > 1.65

accept Ho, which means that price is an important influence in the

choice of product brand loyalty.

TEST OF HYPOTHESIS THREE

Ho: Company image and brand name contribute significantly to

consumers loyalty to particular brands.

Hi: Company image and brand name do not contribute significantly

to consumers loyalty to particular brands.

Z = x – np

np(I – p)

Where x = Respondent Ho

n = Sample size (288)

P = Probability for Ho acceptance

(0.50)

= Level of significance (0.05) or 1.65

64

DECISION RULE

Accept Ho if the Z is greater than zt. Otherwise reject Ho.

SOURCE OF TEST QUESTION 4.2.10

Frequency Percentages

Very strongly 75 27.78

Strongly 65 24.07

Slightly 65 24.07

Very slightly 65 24.07

Total 270 100

From the table all the response supports null hypothesis, the test is

shown below

Z = 270 – 288 (0.50)

288 x 0.50 (1 – 0.50)

= 126

72

= 126

8.49

Calculated value = 14.84.

65

DECISION TAKEN

Since the calculated value (z) is greater than table of value (zt), 14.84 >

1.65 accept Ho which means that company image and brand name

contribute significantly to consumer’s loyalty to particular brands.

TEST OF HYPOTHESIS FOUR

Ho: Consumers perceptions of the quality of the cereal foods have

significant impact on brand loyalty.

Hi: Consumers perceptions of the quality of the cereal foods have no

significant impact on brand loyalty.

Z = x – np

np (I – p)

Where x = Respondent Ho

n = Sample size (288)

P = Probability for Ho acceptance (0.50)

= Level of significance (0.05) or 1.65

DECISION RULE

Accept Ho if the Z is greater than zt. Otherwise reject Ho.

66

SOURCE OF TEST QUESTION 4.2.11

Frequency Percentage

Yes 180 66.67

No 90 33.33

Total 270 100

From the table, those who support null hypothesis has 66.67% response,

therefore the test is shown below

Z = 180 – 288 (0.50)

288 x 0.50 (1 – 0.50)

= 36

72

= 36

8.49

Calculated value = 4.24

67

DECISION TAKEN

Since the calculated value (z) is greater than table of value (zt), 4.24 >

1.65 accept Ho which means that consumers perception of the quality of

the cereal foods have significant impact on brand loyalty.

68

CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSION AND

RECOMMENDATION

5.1 SUMMARY OF FINDINGS

The research work which was involved the incidence of brand loyalty

among the consumers of cereal foods in Enugu metropolis revealed so

many interesting findings which were derived from the analysis of

consumer’s questionnaire, and oral interview.

Among the findings made are:

ϖ Consumers of cereal foods were to a reasonable extent loyal to

particular brands. In every ten consumers of cereal foods, six of

them were loyal to particular brands.

ϖ Price of the various brands exerts a significant influence on the

loyalty of consumers though there was no relationship between

the income of consumers and the extent of influence exerted by

price.

ϖ It was also discovered that consumers perception of the quality of

the preferred brands have a significant impact on the brand

loyalty as almost 67% the consumers consider quality in the

69

choice of their brands. Further brand name was an important

influence on consumers loyalty to particular brands.

ϖ Consumers have basic expectations in their favorite brands.

Consumers consider the attributes important in the following

order:

Nutritional value

Milk content

Taste

Dissolvability

Sugar content

The claims of loyalty to particular brands were true and real since they

were able to identify their most preferred brands.

5.2 CONCLUSION

This study has been a painstaking effort geared towards ensuring

authentic results.

This study has vindicated the claim of brand loyalty to particular brands,

an obvious indication of the conservatism of consumers. Without a

deeper customer insight marketers will be limited in their ability to do

meaningful predictive modeling, market segmentation and revenue

70

forecasting. Better understanding of consumer behaviour, predisposes

intentions and preferences enables more effective and relevant

messaging. It is also an essential part of customer revenue optimization

and life value building.

5.3 RECOMMENDATIONS

This study established the existence of brand loyalty amongst cereal

foods consumers. An important implication of this result is that new

entrants into the market will have difficult task penetrating the market.

Such companies will relatively make little impact in the cereal foods

market. Existing brands also will need to exert a more than average

effort increase their market share.

It is obvious from the result that the extent of loyalty is a result of

combination of many marketing variables.

Therefore companies should further ascertain what about their brands

is/are of utmost importance to consumers and exploit it to build and/or

improve the loyalty of consumers to their brands.

71

Another important deduction from the study is that price is an important

influence on brand loyalty. The economic hardship in the country is

biting hard across all the income groups. Most consumers will switch to

cheaper brands as their favorite brands become more expensive. This

may be explaining why there are so many new and cheap brands in the

market now. Though these new brands may not constitute such a threat,

it is not good development when your loyal consumers have an easy

opportunity to try other brands. Many of the big names in the industry

like Nestle foods have sensed the danger and resorted to product

differentiation.

Effort should be increased on the local sourcing of raw materials so that

price of these products can be kept at affordable level and thereby

encourage brand loyalty.

Equally important is that consumers perception of quality (measured by

the attributes) that influence loyalty hinges very much on the Nutritional

value.

However, it is not likely that firms if left alone in seeking their own goal

of profit maximization will offer brands with high nutritional value

which contribute to the grooming of a healthy community. One way of

72

formalizing responsibility in this regard is with industry code of ethical

conduct or policy that prescribes and enforces minimum nutrient

requirements in instant foods. Also, National Agency for Food and Drug

Administration and Control (NAFDAC) should enforce to the letter the

basic nutrient requirements of cereal foods especially in the new brands

being introduced into the Nigerian market.

Another interesting conclusion drawn from the study is that company

brand name exerts a great influence on loyalty. Companies that are keen

on introducing new brands should therefore bear in mind that brand

name attract patronage and loyalty to the new brands. They should also

recognized that the cost of producing a new product seems to be rising

with inflation. This has resulted in a more cautions management of

existing products instead of the development of new ones. Companies

should focus on good quality of the product and integrated marketing

communication (IMC) on popular brand names already existing in the

market. This will help sustain loyalty of consumers.

73

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Implication for Markets, Journal of Brand Management Vol.12

No.4

David J. Rubsterin (1985) “Marketing Concepts, Strategies and

Decisions, (Englewood cliffs, prentice Hall Inc.) pp 284 – 285.

Henry Assael (1993) Consumer Behaviour and Marketing Action. 4th

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John Oshaughnessy (1988). Competitive Marketing 2nd Edition,

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Kotler P. (1991), Marketing Management Analysis, Planning,

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Hall Inc. pp. 262- 263

Kunde J. (2002) Unique Now or Never: the Brand is Company Driver

in the New Value Economy, Financial Time Prentice Hall London

Leon G. Schiffman and Leslie Lazar Kanuk (2002), Consumer

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74

Kotler P. (2002) Marketing Management, Melenium Edition, Prentice

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The Nation 29 January P. 23.

75

QUESTIONNAIRE

School of Postgraduate Studies

Mba Marketing University of

Nigeria Enugu Campus

Dear Respondent

Questionnaire on cereal foods. This questionnaire is intended for use in

research work. Please answer each question sincerely your answers will

be used only for research and nothing else and we promise on our

honour to treat the information given with the strictest confidence.

Indicate your responses by ticking ( ) where applicable. Cereal foods

refer to such drinks as Corn flakes, Golden mourn, Soypos While Oat,

etc).

1. Do you take cereal foods in your home?

Yes………………………… No……………………

2. What is your status in the family?

(a) Husband…………………… (b) Wife………………

(c) Daughter/Son…………………………

(d) House help………………..

3. Do you go to buy any particular brand of cereal foods.?

76

Yes………………………….. No…………………..

4. Mention the brand you will preferably buy…………….

5. Do you at times switch over to other brand

Yes ………. No……………….

6. If yes what do you think was responsible for this?

a) Price of the product

b) Lack of the product

c) Others

7 Which of the following brands will you buy if the prices are the

same? (Tick just one).

Corn flakes

Golden Mourn

Soypos

Cocoa pops

White Oat

Fruit & fiber

8 Does your choice of cereal foods depend on perceived attributes

of the brand?

Yes ……………………….. No…………………

77

9 Which of these attributes determines most importantly your

choice of food drink (choose only one)

(a) Milk content

(b) Taste

(c) Sugar Content/Level

(d) Dissolvability

(e) Nutritional value.

10. To what extent are you influenced by company image in your

choice of cereal foods?

Very strongly

Strongly

Slightly

Very slightly

11. Does the quality of your choice of cereal foods influence you?

Yes ………………… No……………….

12. Please state the level of your income

(a) Low income

(b) Middle income

(c) Upper income

13. What is the level of your education?

78

(a) B.Sc and above

(b) HND

(c) OND/NCC

(d) GCE/SSCE

(e) Primary Six

79

APENDIX II

COMPUTATION OF Z VIA ZT -TEST FOR

HYPOTHESIS 1

Z= x - np

�np (1-p)

Where x = Respondent (190)

n = Sample size (288)

p = Probability for ho acceptance (0.50)

� = Level of significance (0.05) or 1.65

Z = 190 – 288 (0.50)

�288 x 0.50 (1-0.50)

= 46

� 72

= 46

8.49

= 5.42

80

COMPUTATION OF Z VIA ZT- TEST FOR

HYPOTHESIS II

Z = x - np

� np (1-p)

Where x = 165

n = 288

p = 0.50

Z = 165-288 (0.50)

�288 x 0.50 (1-0.50)

= 21

� 72

= 21

8.49

= 2.47

81

COMPUTATION OF Z VIA ZT- TEST FOR

HYPOTHESIS III

Z = x – np

� np (1-p)

Where x = 270

n = 288

p = 0.50

Z = 270 – 288 (0.50)

�288 x 0.50 (1.050)

= 126

� 72

= 126

8.49

82

COMPUTATION OF Z VIA Z-TEST FOR

HYPOTHESIS IV

Z = x - np

�np (1 - p)

Where x = 180

n = 288

p = 0.50

Z = 180 – 288 (0.50)

�288 x 0.50 (1 – 0.50)

= 36

� 72

= 36

8.49

= 4.24

83