PRODUCT ATTRIBUTES AND CUSTOMERS’ LOYALTY: A STUDY OF SELECTED TOOTHPASTE PRODUCT IN SHOMOLU LOCAL GOVERNMENT AREA LAGOS STATE

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CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND TO THE STUDY

One of the pertinent issues in strategic Marketing Management is the need to strive for products attributes and enhance customer loyalty. Consumer behavior has been always of great interest to marketers. The knowledge of consumer behavior helps the marketers to understand how consumers think, feel and select from alternatives like products, brands and the like and how the consumers are influenced by their environment, the reference groups, family, and salesperson and so on. A consumer’s buying behavior is influenced by cultural, social, personal and psychological factors. Most of these factors are uncontrollable and beyond the hands of marketers but they have to be considered while trying to understand the complex behavior of the consumers.

Consumer behavior can be defined as the decision-making process and physical activity involved in acquiring, evaluating, using and disposing of goods and services. This definition clearly brings out that it is not just the buying of goods or services that received attention in consumer behavior but, the process starts much before the goods have been acquired or brought. The study of consumer behavior is the study of how individuals make decisions to spend their available resources (time, effort, money) on consumption related item. It includes the study of what they buy, where they buy it, how often they buy it and how often use it. It is important to know how consumer reacts towards different product features, price and advertisement, in order to ensure strong competitive advantage.

Consumer loyalty is a significant issue in strategic Marketing Management. According to Uncles (1998) organizations should strive for developing customer loyalty as it would result in a situation customer do not for other products and stay with organization. Similarly, Solomon (1992) highlighted a loyalty customer does not take much of organizations time and thus make the sale transaction relatively simple. It would save lot of selling and administration expenses of organization as loyal customer base does not require organization to spent a lot of money on promoting its product.

The focus of this study is to evaluate the importance of product attributes and customer loyalty of close-up Herbal toothpastes and Dabur Herbal toothpaste in Marketing Management. Product attributes can be defined as characteristics by which products are identified and differentiated. They comprise features, functions benefits and uses of the products. Brand loyalty on the other hand has been proclaimed by some to the ultimate goal of marketing. In marketing, customer brand loyalty consists of a consumer’s commitment to repurchase the brand and can be demonstrated by repeated buying of a product of service (Dick and Babu, 1994). True brand implies that the consumer is willing, at least on occasion: put aside their own desires or minor preference in the interest of the brand (Oliver, 1999).

Apart from the above, customer product attributes and initiatives lead to higher level of customer brand loyalty. Customer product attributes is a critical concept in marketing and consumer research. In theory, if consumers are satisfied with a product, service or brand, they will be more likely to continue to purchase it and tell others about their favourable experience with it. If they are dissatisfied, they will more likely switch products or brand and complain to manufactures, retailers and other consumers. Initiatives are commendable process that would improve growth, enhance margin expansion and create trade support for existing brand.

1.2     STATEMENT OF RESEARCH PROBLEM

The success or failure of any business greatly depends on the patronage of customers since they will make the final decision on the brand to purchase.  Buttressed below are some of the challenges faced by manufacturer in retaining customers’ loyalty:

Attracting Customers are more difficult nowadays due to the challenges of competition among other brands and the need to maintain the volume of business that organization faces. The competition challenge has three major implications for what customer wants such as increased choice, greater value of money and augmented level of service.

Customers who receive poor or inferior product will typically relate their disproduct attributes of the manufacturers product to 15 “ 20 others customers (Griffin, 1995). Gitomer (1998) reported that the cost of gaining a new customer is ten times greater than the cost of keeping a satisfied customer. In addition, if the service is particularly poor, 91% of customers will not return to the manufacture. Satisfied customers improve business and dissatisfied customers ruin business (Anderson & Zemke, 1998; Leland & Bailey, 1995).

1.3     AIMS AND OBJECTIVES OF THE STUDY

The main of this study is to evaluate the importance of product attributes and customer loyalty in Shomolu Local Government area of Lagos State.

The specific objectives shall be:

1. To determine the relationship between product attributes and customer loyalty.
2. To find out the perceived effect of product attribute on customers’ purchase decision.

• To examine the effect of customers’ loyalty on organizational sales volume.

1. To determine the effect of product attributes on organizational productivity.

1.4     RESEARCH QUESTIONS

The project research questions are given as follows:

1. What are the relationship between product attributes and customer loyalty?
2. What are the perceived effects of product attribute on customers’ purchase decision?

• How effective is customers’ loyalty on organizational sales volume?

1. How does product attributes affect organizational productivity?

1.5     RESEARCH HYPOTHESIS

The research hypotheses are as stated below:

H₁:    There is significant relationship between product attributes and customer loyalty for the two brands of toothpaste.

H₂:    There is significant relationship between product attributes and customers purchase decision for the two brands of toothpaste.

 1.6     SIGNIFICANCE OF THE STUDY

This research project is topical and timely as the findings and recommendation would be practically and theoretically beneficial to both companies (Dabur International Limited and Unilever Plc). Specifically, the following are the salient significance of study:

The finding would assist the management of  toothpastes product in consolidating on the strength of their products; serving as an insight through which they can expand on the untapped opportunities while at the same time working to correct the threat to product attributes.

The findings would be beneficial to customers on attributes to watch out for in product before developing loyalty for such products. It will serve as a better guide in their purchase decision.

The study will also serve as an eye-opener to students, providing them a foundation through which further research can be made on product attribute and customers’ loyalty.

1.7     SCOPE OF THE STUDY

This research work examines product attribute and customers’ loyalty with a view to explore toothpastes products from Dabur International Limited and Unilever Plc.

The study focuses on customers in Shomolu Local Government area of Lagos State. The study covers customers’ purchasing power, tastes, preferences, emotion with regard to Dabur Herbal and close-up Herbal toothpastes.

The study as perceived might face some logistic challenges in term of the time involved in the administration of research instrument to the customers in the study area and the costs involved in carrying out the research, but nevertheless, it would endeavor to accomplish its aims and objectives.

1.8     DEFINITION OF TERMS

In management, the under-listed terms are used operationally to describe the various types of management concepts, which would be used in this research work.

Attribute: This refer to distinctive tangible and intangible features of a product that give its value to a user.

Brand: A brand can be defined as a name term, sign, symbol or design, or a combination of these, that is intended to identify the goods and services of one businesses or group of businesses and to differentiate them from those of competitors.

Customer: This refers to a person either male or female who buys the product of an organization.

Management: Management is the process of achieving organizational objectives, within a changing environment, by balancing efficiency, effectiveness and equity, obtaining the post from limited resources, and working with and through other people.

Place: all the company activities that make the product or service available to target customers.

Price: The amount of money charged for a product or service, or the sum of the values that consumers exchange for the benefits of having or using the product or service.

Product: Anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need. It includes physical objects, services,. Persons, places organizations and ides. This includes Dabur Herbal toothpaste and Close-up Herbal toothpaste in this work.

Product Attribute: This can be defined as characteristics by which products are identified and differentiated. They comprise features, function, benefits and of the products.

Promotion: Activities that communicate the product or service and its merits to target customers and persuade them to buy.

REFERENCES

Uncles, M.D. (1988) ˜Calculations for Multi-Brand Buying’ in Repeat-Buying: Facts. Theory & Applications (second Edition) by Andrew S.C Ehrenberg, Griffin, London & OUP, New York.

Oliver, R.L (1992), an investigation of the Attributes Basis of Emotion and Related Affects in Consumption: Suggestions for a Stage-Specific Product attributes Framework. In J. Sherry & B. Sternhait (Eds), Advances in Consumer Research (Vol. 19, pp 237 “ 244).

Dick, A.S. & Basu, K. (1994), Customer loyalty: Toward an integrated conceptual approach.Journal of the Academy of Marketing Science, 22 (2), 99 “ 113.

Porter, M. E. (2011). Creating shared value. http://hbr.org/2011/01/ the-big-idea-creation-shared. Value (accessed 23 January 2011).

Solomon, C. M. (1992). The loyalty factors, personnel Journal, 52- 62.

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