University of Nigeria Research Publications

UZOBUIKE, Pauline Uche .N.

Aut

hor

PG/MBA/93/18144

Title

The Incidence of Brand Loyalty among

Consumers of Cocoa Food Drink in Enugu Metropolis

Facu

lty

Business Administration

Dep

artm

ent

Marketing

Dat

e May, 1998

Sign

atur

e

DEPARTMENT OF MARKETING FACULTY OF BUSINESS ADMINISTRATION

UNIVERSITY OF NIGERIA 1

ENUGU CAMPUS

. . :$ :>5 ...,. ::i ::$ i:! 3 T> .. ,. ij< $' . $ i:i( i'if ;$ .;::: ... ? ;:$ :,::: ::::; :I:!: ..... :fi ..A :*a ;$ .:.>

:i ;;$ 3 .:? .... ... (

THE INCIDENCE OF BRAND LOYALR AMONG CONSUMERS OF COCOA FOOD DRINK IN ENUGU METROPOLIS

P

UZOBUIKE PAULINE UCHE NONYE (PUN)

PG - MBA- 93-18144

DEPARTMENT OF MARKETING FACULTY OF BUSINESS ADMINISTRATION

UNIVERSITY OF NIGERIA ENUGU CAMPUS

THE INCIDENCE OF BRAND LOYALTY AMONG CONSIYMERS OF COCOA FOOD DRINK IN ENUGU METROPOLIS

UZOBUIKE PAULINE UCHE NONYE (PUN)

PG - MBA - 93 - 18144

A DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE DEGREE OF MASTER OF BUSINESS

ADM INlSTRATlON (MBA)

FACULTY OF BUSINESS~ADMINISTRATION UNIVERSITY OF NIGERIA

ENUGU CAMPUS

MAY 1998

CERTIFICATION

We certify that this dissertation: THE INCIDENCE OF BRAND LOYALTY AMONG CONSUMERS OF COCOA FOOD DRINK IN ENUGU METROPOLIS is an original work written by Uzobuike Pauline Uche Nonye (Reg. No: PG/MBA/93/18 144) and was carried out under our supervision.

I /

- - / ' 8'

D.A. NNOLIM (MRS.) PROJECT SUPERVISOR HEAD OF DEPARTMENT

w

. ,

D E D I C A T I O N

TO M Y MOTHER MRS. G. UZOBUIKE

AND

M Y BROTHERS KEN AND ANTHONY

AND

M Y SISTERS EKWY, COMFORT & EBELE

FOR ALL YOUR LOVE AND PATIENCE.

ABSTRACT kr

This study is concerned with the incidence of Band Loyalty, the . .

basis and extent of such loyalty in the food drink market.

Given the background of the problems, the stud

1. To determine the existence and extent of brand

consumers of cocoa food drinks.

y sought to:-

loyalty among

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

loyalty.

3. To determine the extent consumer perception of the attributes

of the food drinks 'influence brand loyalty, for particular brands

(Attributes includes such things as taste, milk content, sugar .

content, dissolvability, nutritional value).

4. To ascertain the extent company image and brand name

inliuence brand loyalty. I

5. To establish whether consumers can identify their most

preferred brands, that is to say, to know if consumers

perceived difference are real or a mere psychological

phenomenon.

To achieve the above goals, the following f ivf jworking

hypotheses were formulated. . P

Cocoa food drink consumers are loyal t o particular brands.

Price is an important influence in the choice and loyalty for

cocoa food drinks.

Consumers perception of the quality of food drinks have

significant impact on brand loyalty.

Company image and Brand Name contribute significantly t o

consumer's loyalty t o particular brand.

Consumer's can identify their favourite brand in a Blind Taste .

Test.

Following an exploratory survey in the markets and

superstores, the study was restricted t o six popular brands. These

include Bournvita, Ovaltine, Milo, Nescoa, Vitalo and Pronto. With ,

the aid of a computer, t w o classes of data was analysed to attain the

research objectives.

' 1. Consumer survey: This comprised of 270 respondents

randomly selected for testing of Hypotheses I - IV.

3. A laboratory Experiment (Blind Taste Test) corpiucted on 150

selected group of consumers.

In both cases, responses to most of the questions were ordered

on a five points rating scale. The weighting system was employed to

convert the qualitative responses to quantitative variables amenable 3

to statistical tests.

The T-test for testing the equality of proportions as well as the

use of Analysis of variance (wi th F-Ratio as the test statistics) was

employed in testing hypothesis I - II. Hypothesis Ill was tested using

the Analysis o f variance and pairwise comparison while Hypothesis IV

was tested using the multiple regression analysis. The Blind Taste

Test data for testing of Hypothesis V was analysed using the

chi-square statistics.

Accordingly the major findings were as follows. f

1. The consumers of cocoa food drinks are to a reasonable extent,

loyal to particular brands. .In every ten consumers of cocoa

food drinks, six o f them are loyal to particular brands.

2. Price o f the various brands exerts significant influence on the

loyalty of.consuniers. The study did not establish any

vi

relationship between the income of consumers and the extent

of influence extorted by price. , .

Consumers have basic expectations in their favourite brands

and are no t naive as advertisers would want us believe.

The order of importance of the attributes to consumers is as

follows:-

Nutritional value

Milk content

Taste

Sugar level

Dissolvability

j Name is an important influence on consumers loyalty to

particular brands however company image is not considered

important. *

The claim to be loyal is real as consumers can identify their

most preferred brand when disguised. ,

Consequently, the study poses the following implicators for

decision makes.

vii

Hard times await new entrants into the food dri& market because

of the existence of brand loyalty.

Brand managers should further ascertain what encourages and

sustains loyalty so as to exploit such attributes.

Since even loyal consumers are sensitive to price differences, the

excessive hiking of brand prices may not be a sound marketing

decision by brand managers.

Most consumers consider the nutritional value of brands very

important and as such it should be emphasized seriously in

advertising. NAFDAC and other decision makers should ensure

hiy h Nutritional standards. I

Brand Name is very important in maintaining loyalty. Brands with

known high performance in quality should be consistent in

maintaining such quality to maintain loyalty.

Since company image is not considered important, even

established and well known companies may not find it easy

introducing new brands successfully.

It is the sincere hope and belief of the researcher that this study I

provides the honest view of consumers in the food drink market and such

. . . Vlll

provides the participants the guidelines for increasingand sustaining their

market share through improved brand patronage and loyalty.

PREFACE

As competit ion heightens in the food drink industry, managers

are faced wi th the great .challenge of not just expanding their market

share but retaining their market share. The stringent economic

programmes of the country leaves the consumer w i th little or no

disposable income, which is spent where it has the maximum util i ty

The antidote for survival is for companies t o assess the level of

loyalty that their product has and what consumers actually want in

products t o keep them buying it. A good manager actually

understands that a 20% loyal ' market share is better than 35%

non-loyal market share. Thus such companies wil l invest heavily in

keeping the loyal customers.

This study is 'a practical investigation of the level of consumers

existing loyalty t o some Brands of food drinks. I t is also interested in

the various attributes on which loyalty is predicated. ' .

The study opens w i th chapter one which expounds the core

problem of the study, the objectives of the study, the working C

I

hypothesis and the significance of the study.

Chapter t w o deals wi th review of relate$ literature. The

working hypothesis listed in chapter one were given both theoretical

and conceptual framework.

Chapters three and four deals wi th the research methodology

and design, presentation and analysis of data respectively. The

section on discussion of results seeks to relate the findings of the

result to other empirical evidences where applicable as well as

tlieoretically conceptualising them.

The concluding chapter five summarises the 'f indings noting

their implication and suggestion of areas for further research.

The obvious limitations of this project should be considered as

the reader appraises the project. . .

1. The study is limited to Enugu metropolis only

2. The study is also ,a measure of attitude which is rather diff icult

to measure.

UZOBUIKE P.U.N DEPT. OF MARKETING FACULTY OF BUSINESS ADMINISTRATION r

UNIVERSITY OF NIGERIA ENUGU CAMPUS.

ACKNOWLEDGEMENT

I wish t o express m y sincere appreciation t o all whose efforts,

comments and pieces of advice were of tremendous help in

completing this project.

I am highly indebted t o my Supervisor Mrs. Nnolim who

painstakingly read through every piece, made useful suggestions and

insisted on high professional and ethical standards. Thanks so much.

I also appreciate greatly the input made ,by my lecturer Mr. 0.

Akabuogu of O'Kris Management Consultants who provided a guide

on the appropriate analytical methods employed in data analysis. Mr.

Nwaizuybe's (of Marketing Dept. UNEC) contribution to the sucessful

completion of this work is invaluable. When morale was down and I

almost gave up, he gave the necessary encouragement and guidance

needed to go on.

Worthy of note also is the important role played by some of m y

colleagues at Queen's School

Mrs. Omeh etc and some

successful carrying out of the

Enugu - Miss Udeozor, Mrs. Ndunagu,

of m y students

Blind Taste test.

who helped in the

I

xii

I cannot forget all manner o f encouragement ,and prayer

support given by m y most worthy friends, Dr. & Mrs. Sam Ikeh. God

bless you.

Finally 1 want t o appreciate the love and support given t o me

by my sisters Ekwy, Comfort and Ebele and my ever l ov i ng brother

Kenneth. I love you all.

Now unto the King enternal, immortal invisible, be all the glory

for ever and ever for indeed, I owe it all to Jesus.

UZOBUIKE P. U. N.

DEPARTMENT OF MARKETING

FACULTY OF BUSINESS ADMINISTRATION

UNIVERSITY OF NIGERIA ENUGU CAMPUS

TABLE OF CONTENTS

CERTIFICATION

DEDICATION

ABSTRACT

PREFACE

ACKNOWLEDGEMENT

TABLE OF CONTENTS

LIST OF TABLES

APPENDICES

Chapter I INTRODUCTION

1.1 Definition of Problem

1.2 Objectives of the Study

1.3 Hypotheses

1.4 Si,jnificance of the Study *

1.5 Limitations of the Study

Chapter II REVIEW OF RELATED LITERATURE b

2.1 Purchase Decision'Making, A Choice, Not a Chance

2.2 Habit Purchase and Brand Loyalty

2.3 Models of Consumer Behaviour

PAGE

I

I I

... I l l

ix

xi

xii

xvi

xvii

1

4

8

9

10

11

1 4

14 I

xiv

and Consumer Learning,

2.3.1 Marshallian (Economic) Model *r

2.3.2 The Pavlovian (Learning) Model

2.3.3 Freudian (Psychoanalytic) Model

2.3.4 A Contingency Approach

2.4 Theoi-etical Framework

Chapter Ill RESEARCH DESIGN AND METHODOLOGY

3.1 Scope of the study

3.1.1 Area Covered

3.1 .2 Rationale

3.1.3 Brands Covered

3.2 Sources of Data

3.2.1 Secondary Sources of Data

3.2 .2 Primary Sources of Data

Chapter IV PRESENTATION AND ANALYSIS OF DATA

4.1 Introduction

4.2 Consumer Survey Resul-ts

4.3 Blind Taste Test (Experiment) Results

4.4 Discussion of Results

4.4.1 Existence of Brand Loyalty

4.4.2 Price and Brand Loyalty

4.4.3 Consumers Perception of Attributes

influence on Loyalty

4.4.4 Brand Name, Company Image

and Brand Loyalty

4.4.5 Reality of Consumers Preferences.

Chapter V SUMMARY, IMPLICATIONS, RECOMMENDATIONS

CONCLUSIONS AND AREAS FOR FURTHER RESEARCH

5.1 Surnrnary of findings

5.2 Implications of the study

and Recommendations

5.3 Areas for further Research

5.4 Conclusion ,

Bibliography

Appendix

xvi

LIST OF TABLES w

Table 4.1 Response Ratio of Survey Questionnaires

4.2 Usage Ratio of Returned Questionnaire

4.3 Blind Taste Test Questionnaire Usage Ratio

4.4 Consistency of Consumers Purchase

Pattern Classified into two .

4.5 Consumers Preference Ranking

of Brands of food drinks

4.6 Consumers Responses on

degree of price Influence.

4.7 Consumers Responses on Price

influence classified into t w o proportions.

4.8 Degree of price influence on consumers in their

choice of Brands according t o income groups. 6 1

4.9a Consumers Perception of attributes - means

of attributes.

4.9b Anova Table for means of attributes

4.1 0 Pairwise comparison of means of attributes

4.1 1 Relationship Between Brand Loyalty and Brand

xvii

Name and Company Image Multiple

Regression Table.

4.1 2 ldentification of most preferred brand.

4.1 3 Consumers Preference Ranking of

Brands before and after the Blind taste Test. 69

4.1 4 Weighted ~on&mers Preference Ranking

of'Brands before and after the Blind Taste Test. 71

A . l Overall Preference Ranking of brands of food drinks. 1 0 4

A.2 Degree of Price influence on Consumers. 1 0 6

A.3 Frequency distribution of degree of importance 1 0 8

attributes in choice and preference of brands. ,

Table A.4 Identification of most preferred brand. 1 1 0

LIST OF APPENDICES Y

Appendix IA Consumer Surrey Questionnaire' 95

IB Blind Taste Test Questionnaire 101

Appendix I 1 Testing of Hypotheses 103

IIA Testing of Hypothesis I 103

IIB Testing of Hypothesis II

IIC Testing of hypothesis Ill

1ID Testing of hypothesis V ,

CHAPTER ONE M

INTRODUCTION

Hurnan behaviour is enormously varied and very complex and is

predicated 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 centred on the

consumers. This is implied in the marketing concept echoed by most

rliarketers which is consumer satisfaction at a profit as the basis for

s~~ccessful marketing. In their varied description of consumers as

Levitt puts it, some people describe 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 ( maiketing 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 products are

purchased under some particular brand. This contrasts with what

obtained when products were once considered simply as commodities 3.

in the early days of marketing. Commodities or goods are

differentiated only by their uses and not by their suppliers. Todays

marketers recognize that the total product is greater than simply the

physical good itself and believe that all goods and services 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.

Corisilmers confronted with a familiar brand have information about

the products image, as promoted by the company. Even products that

are very similar are now considered distinguishable by brand.

Consumers perception of different brands of various product

categories determine to a large extent their buying pattern. Ehrenberg i

and Goodhart claim on the basis of their evidence 'that buyers choose \

I

from a repertoire of brandsf2 . However O'shaughnessy 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 b ~ u g h t ' ~ , . Compete acceptance of

what Ehrenberg and Goodhart advanced is accepting that their is no

brand loyalty. 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 behaviours 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 in

product marketing. I

This study seeks to find out the existencesr non existence of

brand loyalty among the coca food drinking industry. The researcher

is not oblivious of the fact that brand loyalty is an exhibition of

corlsumers attitude to products which is somewhat difficult to

rncasure. However it is believed that just as David Reibstein puts its,

the buying pattern of the product, and the proportion of purchase a

particular brand bought are indications of brand loyalty4.

1 .1 DEFINITION OF PROBLEM

The coca food drink industry in the country is experiencing a

continuous increase in the number of brands competing for

corwmers income. From the story of importation of Ovaltine in the

early thirties as the only food drink in the country, there has been a

continual increase in 'the number of cocoa food drinks in the country.

Today there are no less than eight different brands of cocoa food

drinks available in the market.

In those early days, the beverage market was the seller's I

market. Initially it was only ovaltine, unit 1937 when Cadbury Fry

Export Limited, a British company imported into Mgeria the first cans

of Bournvita competitively on a commercial scale. Ovaltine was then

the leading brand. But because it was imported as a wholly finished

product, it lost its position to Bournvita following the ban placed on

the inlportation of beverages at the beginning of the Nigerian civil

War in 1967.

Bournvita and Pronto, both products of Cadbury Nigeria

Limited, dominated the market for a long time. Consumers were

multiplying, buying more of the brands. However new firms have

continued to enter to the extent there are at least seven firms (with

local plants) each producing different one or more brands of instant

food drink. The entire dominations of the market is now more of

history. It is therefore unrealistic for any company t o rest on a mere

assumption of market leadership without considering the changing I

market share.

In todays factored market place, things likebranding products,

and market share for instance no longer quarantee loyal customer. Iq

one case after another, the old established brands have been

supplanted by the rise of other brands. No singlefiompany 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 products6. 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 are 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 tb own the whole pien6.

Owning the market demands some responsibilities such as

bringing into your camp third parties who want to develop their own I

products, or offer new features or add-ons to augument your product.

ilu

You get the first look at new ideas that others are testing in that

market, you attract the most lalented people because of your

acknowledged leadership position. This is why it has become

necessary to investigate the existence or otherwise of brand loyalty

among the consumers of cocoa food drinks in Enugu Metropolis.

Accordingly therefore, the major research questions are:

Are the consumers of cocoa food drinks in Enugu loyal to

particular brands and to what extent does such loyalty exist?

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

particular brand?

Does consumer perception of attributes or quality of the brands

influence loyalty?

What role does company image and brand Name play in the I

promotion of loyalty t o particular brands.

the minor problem addressed by the study is;

Can the consumers really identify their preferred brands in a .

blind taste situation I

P

1.2 OBJECTIVES OF THE STUDY

The research is basically directed towards the investigation of

an existence of brand loyalty or not among consumers of cocoa food

drinks. To this end, therefore, the objectives of the study is to seek

and possibly find solutions to the problems identified above; the

extent and basis of consumer loyalty.

Specifically, the objectives are

To determine the existence and extent of brand loyalty among

consumers cocoa food drinks.

To determine the influence of price of the products on brand

loyalty.

To determine the extent consumer perception of the attributes

of the food drinks influence brand loyalty for particular brands.

(Attributes includes such things are

(i) Taste

(ii) Milk Content

(iii) Sugar Content

(iv) Dissolvability

(v) Nutritional value *r

To ascertain the extent company image and brand name

influence brand loyalty.

To establish whether consumers can identify their most

preferred brands.

HYPOTHESES

The following hypotheses will be tested to determine the

existence of brand loyalty among consumers.

Cocoa food drink consumers are loyal to particular brands.

Price is an important influence in the choice and loyalty for

cocoa beverage P.

Consumers perception of the quality of the food drinks have I

significant impact on brand loyalty.

Company image and brand name contribute significantly to

consumers loyalty to particular brands.

I Consumers can identify their favourite brands in a Blind Taste

Test.

1.4 SIGNIFICANCE

10

OF THE STUDY

The percentage of consumers of cocoa food drinks continues t o

drop as the economy becomes tougher and general inflationary trehds

continue to 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 t o 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 nichers 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 on the market position of the

product.

Also to benefit from this study are coppanies seeking to

introduce new products. With the identification of existence of brand

loyalty or not among consumers and the factors contributing t o 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,

or be a follower or even nichers in the industry.

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

retailers who will be opportuned t o know the popular brands by the

consumers assessment and take advantage of it in stocking their ,.

inventory.

1.5 LIMITATIONS OF THE STUDY

This study is. restricted to Enugu Metropolis and since brand

loyalty is an attitude and behavioural measurement, the findings .

cannot be generalised t o other environments which might be I

influenced by other factors in their environment.

The researcher also will choose the samplp for the survey on

the assumption that the brand choice of the cocoa food drinks

purchased were made by such respondent.

The blind brand identification test will also be carried out Qqsed

on the questionnaires returned and the participants will be qqwn

form only those who are willing and within the environrnenr ~f the

researcher.

NOTES TO CHAPTER ONE

1 . Theodore Levitt, 'Marketing Myopia', Harvard Business Review

(July - August) p 60

2 . John O'Shaurghnessy, Competitive Marketing 2nd ed,

(London: Briddles Ltd, Guildford and King's Lyn 1988) P. 109.

3. l b i d p 1 0 9

4 . David J. Reibstein, Marketing Concepts, Strategies and

Decisions, (Englewood Cliffs, Preentice Hall Inc 1985)

~ ~ 2 8 4 - 2 8 5 .

5 . Regis Mckenna, Marketing is Everything Harvard Business

Review (Pagerback No. 900087) p8.

6. Ibid p 8

CHAPTER W O tr

REVIEW OF RELATED LITERATURE

2.1 PURCHASE DECISION MAKING: A CHOICE NOT CHANGE

A lot of marketing efforts over the years are channelled A

towards unravelling 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,

Oshvalsky and Richards proposed that the eventual strategy

employed is contingent upon characteristics of the consumer, the

market place, the social environment and the physical environment'.

Several models of the traditional decision making perspective

have been developed by marketing .scholars, the most prominent

being proposed by Seth2, Nicosia3 and Enge14 et al. Though they

vary in details, there are five stages which consistently occur;

problem recognition, information search, evaluation of

alternativeslbrand evaluation, purchase decision and post purchase

behaviour. en;^ Assael outlined the details of the processes thk . .

consumer passes through at each stage5. The first stage of the

traditional decision model is the need arousal stagsand this describes

the consumers state of mind which is his 'psychological set' toward

the prospective purchase. Consumer's psychological set is based on

the product benefit and his attitude towards the various brands.

The hierachy 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 r

criteria. This is important in deciding which brand to buy. Depending

on he product class, there are various attributes which consumers

consider important. For example in

Beer - Taste, alcohol content and price

Tooth paste - Taste, foaming, price, dental protection, (fluoride

content) and colour. . Powdered milk - Dissolvability, taste, price, congealability

Cocoa food drink - Milk and sugar content, dissolvability, nutritive

value, taste and price.

Non-alcoholic soft drinks

I

- Taste, price, brand name.

Need recognition prods the consumer to e m a r k on information

search and this involves exposure, organisation and search for

information. Consumers information search varies directly with the

extentof consumer involvement and daces the consumers attention to

[he marketing stimuli - which has to receive attention, be

comprehended and retained in memory t o be able t o affect consumers

psychological set. The consumer first recognizes the whole

information and clooses the one related to his particular need. The

message having been understood is interpreted t o agree with their

beliefs. However the consumer choose t o 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 kearch.

Brand evaluation is a direct consequence of information search.

Various brands are associ&ed with different benefit critieria and

consumers will choose brands considered to offer those benefits. The

consumer evaluates the brands based on histher priority of desired

I)c~lefits and relates the brand characteristics to these benefits. Thy

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

sequence in the complex decision making mod* is purchasing the

intended brand, evaluating the brand during consumption and storing

this informations in the psychological set.

The above sequence and details were corroborated by Lutz and

Bettman who summarily said that t o reach a purchase decision, the

consumer actively weighs alternatives and expends a great amount of

cognitive efforte,

The extent of cognitive effort expended in the decision making

process depends on the level of involvement of the product.

According to Assael, high involvement products are those that are

>

important to the consumers, products that,are "closely tied to the

consumers ego and self image" and involve some reasonable amount

of risk to the consumber7. Low involvement purchase is one where

the consumer does not co'nsider the product sufficiently important to

Ilislher belief system and does not strongly identify with the pq~duct

most purchase decision are low in consumer involvement and a$ such

does not involve much cognitive effort in making a choice a( the \

brands.

The low involvement theorists partic~larly~argue against an

across the board generalizaton of the models of decision making. To

them the purchase decision making can best be approached using

models of passive learning. The basis of their argument explains

Solomon is that consumers 'conserve cognitive effort' when choosing

form among products not central to their belief system or having little

risks or valueg. The phenomenon of impulse purchase lends credence

to this view.

One cannot say yet if food drink is a 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 a high

irwolvement product. The study by Kapferer and Laurent reveal that

consumers level of involvemeht with a product depends not j p t on

risk of wrong choice, amount of income spent or even un~ertainly ,

about the product but also on product imq~ r t an~e to the particular

consumer, interest, badge value and emotjor\'P, 1

The above line of thought therefore implie$that if 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. Some other researchers bring in the idea that

product involvement could be situational or enduring depending on

the emotional attachment of the consumer t o the product. Both

si:uational and enduring involvement are likely to result in complex

decision making .This is why Celis and Oslon angues that emphasis

should be on the product itself and the inherent satisfaction its usage

provides rather than on some situational goals". Thus food drink can

by all implications be a high involvement product for some families,

but whether it is low or high in level of involvement; emotional >

attachment and interest can still lead t o a.complex decision making

process. This is true for mos! product categories.

From yet another dimension Vroom identified .three conditions

in choice behaviour12. First the consumer must have high

'expectancy' that the brapd will achieve the desired objectives., In

other words the product pharacteristics as perceived by the consumer

must be seen as sufficient to facilitate the attainment of the objective.

Secondly the objective must be perceived to have instrumentality,

that is, must be seen as'resulting in the attainment of desired end 1

goals.

Finally, the 'valence' referes to the preference for attaining one

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

individual consumer, a meaningful preference hieraly. 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.

2.2 HABIT PURCHASE AND BRAND LOYALTI'

Habit plirchase is repeat purcha~e of a product due to,

consumer learning. According to As-l, habit purchase is the

opposite of complex purchase decision makingG3. 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 purchases.14 He opened that even

when little consideration is given to other brands, cognitive activity

must occur; decisions has 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 consumers exhibition

of habit purchases. These authors describe the habit purchase

patterns as brand loyalty, inertia or brand committment. Assael

defines brand loyalty 'as repeat purchaselbuying because of

committment to a certain brand and inertia as repeat purchase

without committment to the brandl5' There hqs to be a level of

comittment. for a consumer to be brand loyal. Inertia on the other

hand is developed habit purchase due to consumer passive learning

especially for low involvement products as develcped by Krugman. In

a simple illustration using morton salt, the author describes a

consumers 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 Morton salt not because of commitment to be brand

but mere familiarity and acceptance. - - . . _ _

Another author, described "Brand loyalty as the biaqed (ie non

random) behavioural response ie purchase expressed over time by

some decision making unit with respect to one or more alternative

brands out of a set, of sudh brand and includes a stFong positive

attitude toward the brand"16. Brand commitment on the other hand is

defined "as emotional/psychological attachmeqf to a brand within a

product class"!'. The author considqp Brand loyalty more of repeat

purchase behaviour and different frqp brand commitment. This

contrasts with Assael's approach of considering b r p d commitment as

a basic ingredient of brand loyalty. In thish study however, the

researcher is focusing on brand loyalty as a 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 a repeat purchase

behaviour with or without commitment. At this extreme, Tucker takes

a strong behavioural position' "No consideration should be given to

what the subject thinks or what goes in his central nervous system; 4

his behaviour is the full statement of what brand loyalty is ''. ,

)A e Some other authors like Loudon etallg, Peter OslonZO and Leon

L I .

Schiffman eta12' agree with Tucker 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

probabilistic models of consumer learning to estimate thepg&@ility I

of a consumer buying the same brand again given a nlynber of past

purchases of that brand. However what peoplg do, does not say

anything about why they do 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 L

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. Jacoby strongly posits; "to exhibit brand loyalty implies

repeat purchasing behaviour based on cognitive, affective, evaluation

and predisposition factors - the psychological (decision making

evaluative) process" 22.

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

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 making23 '

I

In a study where beha"ioura1 measures alone were used in predicting

brand loyalty, over 70% of the sample would h p e been defined as

brand loyal, but adding the attitudinal component reduced the

proportion of brand .loyal consumers t o less than 50%. In other

words, defining loyalty based on repeat purchases overstates the

degree of loyalty24

Tucker defined loyalty as three purchases in a row while

Lawrence defined loyalty t o a new brand as four purchases in a rowz5.

*,

The cognitive school of thought would not agree with the above

definitions completely. Assael still argues that the measurement of

1

brand loyalty based on past behaviour may be misleadingz6 In his

example, the consumer may buy one brand of coffee for personal

consumption, another brand for the spouse and occasionally a third

higher priced brand t o haQe around the house for guests. This

consumer may be highly loyal t o the preferred brand but this is not

obvious in the purchase pattern. Brand. lo;alty therefore is a

rnultidimensio~al concept that , must incorporate the consumer

i

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 behavioural

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

measure. This is clearly seen in O'shaughnessy's arguement 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 & 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 i n d determined these

act2', or as the buying habits or patterns of behaviour of consuming

public either in general or in specific groups28 . 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 I

light of understanding on developing and sustaining brand loyalty.

Kotter has identified five behavioural plodels for analysing

buyers namely:-

The Marshallian (Economic) model, the Pavldan (Learning) model) the

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

psychological) model and the Hobbessian (organisational factor)

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 weighting the

expected pains and pleasures of every contemplated action. Thus he I

always trying to maximize satisfaction with his limited resources. The &

factors that influence the consumer therefore are likely to be price,

income and durability.

I

An obvious deduction from this model is that a man faced with

two brands of instant food drink which area 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

quantity which justifies the extra expenditure on it. This is purely an

economic consideration and 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.

Suggested hypothesis 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.

Many other studies have corroborated the marshallian

hypothesis. Number reports fhat demand equations based on price

have been fitted to a wide variety of products such as beer, chemical

and fertilizers3'. Massey also concluded that economic variables have

significant influence on brands such as coffee, orange juice and L

rnargatine3'. +

However economic considerations alonq, cannot explain the

behaviour of the consumer. The first hypothesis from this model

implies that an increable in price will lead to a fall in sales. This is not

always the case and this is why the model is criticised for ignoring

the fundamental questions of how product preferences are formed.

The other mysteries involved in consumer choice and not taken into

consideration rather, it becomes ambiguous ,,when it says that the

consumer acts in his ,own best interest. This is rather too wide a

saying and as such neither true nor false.

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 conditioning was instrumental conditioning by B.F.

Skinner who introduced an aversive stimuli of electric shocks to the i

food-bell response of the dog.

Both Parlov and Skinner concluded that leqqing is an 3.

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 cue 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 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 Marshallian 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 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 forgetting and dissonance. It also

provides useful guidelines to advertising practitioners and copy

writers by helping to identify product drives that must be emphasiz'ed.

In food drinks for instance, drives like vitality and 'thirst' may be I

suggested as strong product related drives.

2.3.3 THE FREUDIAN (PSYCHOANALYTIC) MOQEL

Sigmund Freud, based on his study on child behaviour,

hydpothesized that a child enters the world with instructrial needs

that cannot be satisfied by the immediate environment. According to

him, the mind consists of three parts namely:

The Id - houses the basic instructural drives, most of them,

anti-social.

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

balance between the uninhibited instincts of the Id and social

oriented super-ego.

The super-Ego - The conscience, accepts moral standards and

directs instinctive drives into acceptable channels.

The basic implications of the above model to marketing is that

the real motive of a consumer for buying a specific product or brand . may well be hiden. Manufacturers should provide enough social

*

rationalizations for product purchase and present brand appeals

directed to the sub conscious, to the consumers dreams, hopes and

fears.

2.3.4 A CONTINGENCY APPROACH P

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 purchases 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, El, ,

meaning that behaviour is a function of the interruption of the person

B with the 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 consume; behaviour3'.

Other evidences now abound that there are significant L

influence of psychological variables in the behavioural pattern of the

consumers. Therefore a cheaper understarlding of consumer

behaviour requires a combination of both conscious rational

hypothesis and the psychological related hypothesis.

2.4 THEORETICAL FRAMEWORK

Consumers will repeatedly buy what satisfies them. The

satisfaction thus obtained is a reinforcement and increases the I

b

probability of repurchasing. Thus habit burchasing 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

In the study by Blatterg and Sen they identified four types of

loyalty segment using proportion of purchase.

1) High National Brand Loyal: This group of consumers are loyal to

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

brand.

2 . National brand loyal: This segment also are devoted to one

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

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

private label and most likely purchased from a particular 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 33.

On the other hand Brown classified brand loyal consumers into

four viz.

1. Hard Core Loyals: This group will buy one brand all the time

showing individual loyalty.

2. Soft Core Loyals: Consumers who are loyal to two or three

brands. They are satisfied with the alternative brand in he

absence of the other brand'.

3. Shifting Loyals: consumers who shift from favouring one brand

to another. Preference has shifted from one brand to another.

4. Switchers: Consumers who show no loyalty to any brand. Such I

consumers are 'variety prone'34.

Both Blatterg -& Sen and Browns gassification 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.

The extent o f cbmmitment to a brand is however very

important given the fact that some consumers who are considered

loyal are merely exporting the opportunity of low price or other

economic considerations. This is why spurious loyalty exhibited in

some repeat purchases may be an acceptance and not commitment.

Day would further argue that in order to be truly loyal, the consumer

must hold a favourable attitude toward the brand in addition to

purchasing re~ea ted ly~~ . When- such consumers- who are deemed loyal

are subjected to attitudinal and behavioural measures, the extent of

loyalty certainly decreased as .stated earlier.';This is why the first

hypothesis of the study is posed to ascertain the existence or not of

brand loyalty. Thus, the first hypothesis is

i

H I Cocoa food drink consumers Y

are brand loyal consumers.

From the Marshallian economic model, it can be noted as a

limitation that economic factors alone cannot explain consumer brand

choice. This limitation does not totally deny that a utility maximizer

would give consideration to the relative prices of brands when

deciding on what brand to buy. Price consideration may be of more

importance to people with lower income. Brand loyal consumers many

well be loyal because of the price consideration of the brands.

Arnold Mitchel distinguished the different groups of consumer

values . He identified a set of consumers who are need driven or

money restricted consumers. These are usually people in the low

income bracket who do not have economic options. In USA, this

group is thought to cokti tute less than 20% of the entire

population3' In Nigeria however, it is an obvious fact that given the

present harsh economic realities, more than '60% of Nigerians are in

this category.. Price consciousness can as a matter of fact affect the

purchasing pattern of consumers. It is thereforaalong this reasoning

that the second hypothesis was posed and tested.

H,, Price is an important influence in brand choice and loyalty

for food drinks.

As regards the company image and brand name, the consumers

according to Kotler has a set of brand beliefs' - beliefs about where

such brand stands on each attribute. Thus consumers beliefs and

contents of what is referred to as the evoked set can be known by

asking the consumer to list five or more brands of product class and

rank them based on a particular attribute3'- Though a consumer

brand image could vary with the true attributes, but from experience

the consumers own ideas of the product go a long way to determine

what he buys or does not buy. Oslon believes that a positive image

about a brand may be developed from childhood, carried along as the

consumer grows and invariably believes that such a brand depicts

quality. Such brand image built up over the years encourages the

consumer to be loyal to the brand3'. In Nigeria for example, even I

when there are no 'functional differences in some of the brands of

food drinks, it is an established fact that somGmanufacturing firms

b.

especially those with expatriate background are perceived to present

products of better quality - than indigenous firms. Positive beliefs

about the company image and brand name therefore are likely to

influence the extent of loyalty of consumers to a particular brand.

This is the line of thought expressed in the fourth hypothesis.

HIv Company image and brand name contribute significantly

to consumers loyalty to any brand.

Consumers perception of qualities of food drinks or any other product

also determine the choice and loyalty to a brand. Consumers do not

make chemical or physical analysis of the products they buy. In

reality they have little knowledge of or concern for the technical

standards established by chemists, physicist and engineers in- its

manufacture. In the final analqsis the quality of a product depends on

the situation in the market place, vis - a - vis consumer perception.

However, though consumers do not really analyse in any

details the content of the products, their perceived attributes as. I

contained in the consumers evoked set determine the loyalty status of

the brand. It is the necessity to ascertain thedmpact of consumer

perception of quality of the various brands, that the third hypothesis

was formulated.

HI,, Consumers perception of the qualities of food

drinks have significant impact on brand loyalty.

Consumers judgements of product attributes may be based on ,

grounds that differ from those of laboratory'tests. For example, many

consumers cannot discriminate between the taste and smell of

various brands. When the brand is seen, strong taste and quality

preferences are voiced3'. Their perception is based on brand name

associations derived from advertising and social stimuli. lnfact

contributes like Kotler, Levitt, Keuhn and Day have recognised that

consumers are not perfectly consistent in their choice beha~iour.~'

It is on the basis of this allegation that the fifth hypothesis was

advanced.

H, Consumers can identity their favourite brand in a blind taste

test.

NOTES TO CHAPTER TWO

Solomon Osvalsky, Richard W, "Perceived Quality in Consumers Decision

Making; An Integrated Theoritical Perspective", in Perceived Qualify:

Ifow Corlsumers View Stores and Merchandise, eds Jacob Jacoby and C.

Oslon (Lexington, M. A: Lexington Books 1985), pp 3-29.

J. A. Howard and J. N. Seth, The Theory of Buyer Hehaviuur, (John

Wiley and Sons NY 1969)

I;. M. Nicosia, Corrsumer Decisiorr Processes (Prentice Hall, Englewood

Cliff's, NJ 1966).

J. F. Engel, R. D. Blackwell and P. M. Kollat Co:wmer Behaviour, 3rd ed

(Holt Rinechard and Winston, New York, NY 1978).

Henry Assael, Cunstrmer Behaviour atrd Markeling Aclion 41h ed (Boston,

Kent 1993) pp 25 - 42.

Richard J. Lutz and James R. Bettman "Multi Attribute Models in

Maketing. A Bicen tingial Review" in Coiisumer arrd Irrduslrial Buyirig I

Behaviour, Arch G Woodide, Jegdish N Seth and Benneth eds

(New York: North Holland Publishing Coy 1977) pp 137 - 149

Assael op-cit

8 Harold 1-1. Kassarjian and Waltrand M. Kassarjian, sttributes Under Low

Commitment conditions" in John C. Maloney and Bernard Silverman eds

A ffifude Research Plays for High Stakes (Chicago American Marketing

Associations 1979), p8.

9 Michael R. Solomon, "The Missing Link. Surrogate Consumers in

Marketing Chains", Journal ofMarkefing, Vol 50 (October 1980) p 209.

10. Jean - Noel Kapterer and Ciles Laurent, "Consumer Involvement Profiles:

A New Practical Approach To Consumer Involvement", Journal of

Advertising I(esearch, (December 1985 - Jan 86) pp 48 - 56.

1 I. Richard Celsi and Jerry C Oslon, "The Role of Involvement in Attention

and Comprehension Processes", Jourt~al of Cotlsurner Research 15

(September 1988) pp 210 - 224.

12. Victor 1-1. Vroom, Work and Motivation New York; John Wiley Inc and

Sons, 1964).

I 3. Assail op-cit p 65 t

14. Peter Oslon, Consumer Behaviour and Markefing Strategy (Richard Irwin

Inc, Boston 1993) pp 582 - 586.

1 5. Assael op-cit pp 65, 81 i

1 6. Jacob Jacoby and Robert Chestnut, Brand Loyalt~easurement and

Ma~magemerit (New York; John Wiley Inc and Sons 1978).

17. Sharon and Beathy Lynn, R Kable and Pamela Homer, "The Involvement -

Commitment Model: Theory and Implications", Journal of Business .

&search I b (2) pp 149-1 67.

18. W. T. Tucker, "The Development of Brand loyalty, Journal of Marketi~tg

Research I (August 1964) p 32.

1 9. D. L. Loudon and Albert J. Della Bitta, Co~aumer Behaviours, Cormceps

a~tdApplicatiorts (NY Mc Grow Hill Inc 1993) pp 564 - 567.

20. Peter Oslon, Op -cut pp 282-286

2 1. Leon Schifinan, Leslie Lazar Kanak, Consumer Behaviour (Englewood

Cliffs N. J: Prentice Hall 1993) pp 2 16-2 19.

22. . Jacob Jacoby and David B Kyner, "Brand Loyalty VS Repeat Purchasing

Behaviour" Journal of Marketing Researcit 10 (Fedruary 1973) p2

23. George S. Day, "A Two Dimensional Concept of Brand Loyalty", Journal

of Advertising Research 9 (~d~ternber 1969) pp 29 -36. , .

24. lbid pp 29-36 8

25. W. T. Tucker: "Development of Brand Loyalty" op-cit.

26. Assael Op-cit p 73.

27. Ellgel Blackwell and Kollat, Consumer BehaviourQrd ed (The Dryden

Press, 1978) as in Michael J. Baker, Marketing An Introductory Tex,

(London and Basing Stoke: The Macrnillan Press Ltd, 1981) p 65.

28. N. A. Hart and John Stapleton Glossary of Marketing Terms 2rtd ed

(London; William Heinemam Ltd, 1981) p 42.

29. Philip Kolter, Marketing Management, Analysis, Planning,

Implementation and Control 6 th ed (Englewood Cliffs N. J., Prentice Hall

3 0. Edwin E. Nemmers, Managerial Economics (N.Y, John Wiley and Sons

Inc 1962) part 11.

3 1 . William Massey and Ronald Frank, "Short Term Price and Dealing Effects

in sclccted Markets", Jolir71ul qfMcrr-kdilrg 1~esc.ur.ch Vol 2 (May 1985) pp

32. The expectancy theory posits that motivational effoits of an individual to

select one behaviour from a large set is some hnction of the perceived . likehood that the behaviour will ~esult in the attainment of the various

outcomes weighted by the desirability (valence) of these outcomes to the

person

3 3 . Robert C. Blatterg and Subrats K. Sen "Market Segments and Stochastic B

Brand Choice Models" Journal of Markding (Feb 1976) pp 34 - 45.

34. George Brown Brand Loyalty - Fact or Fiction? Adverlising Age (June 19,

1952) 53-55, (June 30, 1952) 45-47, (August 11, 1952) 56-58, (September

1 1952) 80-82, (October 6, 1952) 82-86, (December 1, 1952) 76-79,

(January 25 1953) 32-35.

35. George S. Day - "A Two Dimensional Concept of Brand Loyalty" op cit.

36. As reported in Paul Day, "The New Consumer Values", Adverlising

Quarlerly 56 (Summer 1978) pp 15-17)

37. Kolter Op Cit

I

38. Oslon Op Cit

40. See for instance Kotler Op Cit, Alfred Kuehn and Raph Day, "Strategy of

Product Quality" Harvard Business I<eview Vol40, No 6, (December

1982) pp 10 1 - 1 10 Theodore Levilt, "Marketing Myopia" Harvard

Busit~ess Review (July - August, 1960).

RESEARCH DESIGN AND METHODOLOGY

3.1 SCOPE OF THE STUDY

3.1.1 Area Covered: This study is restricted to Enugu Metropolis in Enugu

state of Nigeria.

3.1.2 Rationale: Enugu was the capital of the dehnct Eastern Region which

accounted for a substaritial population of the food drink market in Nigeria. Now

the capital of Enugu State, it is still very populous because of its cosmopolition

nature which has become a point of political controversy in recent past. With the

presence of Federal Ministries and a campus of a Federal university, the population

i is made up of people with diverse ethnic background and different social,

educational and income classes.

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

basis for moderate generalizaions of the findings of this study for the Nigerian food

drink market.

3.1.3 Brands Covered: The challenges of the structural Adjustment programme

and the harsh economic realities has made a serious impact in the food drink

industry in the country. While some old regional brands like Cocovite and Grovita i

and almost extinct, some new brands like Bonita, Bevicvnd Kollevita are finding

their way into the market.

However an exploratory consumer survey carried out at various retail

outlets and supermarkets shows that most of the new brands mentioned above are

still regional phenomenon. The brands that have been found to exist and sale on a

significant scale nationally were therefore closen for the study.

These include

1 . Ovaltine

2. Nescao #.

3. Bournvita

4. Milo

5. Pronto

3.2 Sources of Data

3.2.1 The sources of data consists of both primary and secondary sources of

data. The secondary sources of data consists of the following: Pamphlets from the

Public Relations and Marketing Departments of the various brands manufacturers,

Annual Report of firms, Annual reports of the Association of Food, Beverages and

Tobacco Employers (AFBTE), Manufacturers Associa$ion of Nigeria (MAN)

Rccords, Journals, Textbooks, Magazines, weekly and Daily Newspapers.

3.2.2 Prilnary Sources of Data

The nature of the hyp~thesis requires the use of both consumer survey

Data and laboratory experiment. (Blind Taste Test).

a) Consumer Survey

Population and Sample Determination

The population is defined to include all adults who take food drinks. This

ir~cludes liousewives, students, bachelors, and spinsters who play a definite role in

h e purchase of the food drinks consumed in their homes. The population size

cannot be estimated precisely and hence its standard deviation and other

cl~aracteristics are as well difficult to ascertain. An appropriate technique is 1.

therefore used to determine within a limit of error and level of confidence.

At n confitlcncc Icvcl of 95% and tolcrablc limit of crror of 5% thc snrnplc

size is determined as shown below.

Using n - - z2lplpa) '

e2

Where 11 - - sample size

z - - value of standard deviation

therefore

n

Questionnaire was

of the desired confidence leyel

(in this case 1.96).

assumed percentage of the

population who take food drink

(25% or .25)

1-P = .75

limit of tolerable error

i.e 5% (0.05).

employed to collect data for testing hypothesis I-IV. The

sa~riyle questionnaire is as shown in Appendix 1A.

'The questionnaire consistsr of structured multiple choice questions and

open ended questions. The questions covered attitudinal and behavioural

components of brand loyalty. The questions aimed ~,t'finding out consumers

attitude towards the various brands of food drinks under study were rated on a five I

point scale which varied from "definitely will buy" to "definitely will not buy".

The behavioural measures of loyalty were t akenpne of by open ended

questions and includes writing down the purchase paltern of the respondents (by

himselflherself of the various brands of food drinks.

The sample population was selected by random sampling. The sampling

was a combination of cluster and random sampling. The various wards or clusters

was assigned a number of.questionnaires and distributed to residential buildings.

The choice of respondents in each house was based on the willingness of the

respondents

b. Blind Taste Expcrinrent

The sample for the experiment is made up of 150 respondents. The I t pa~ticipants were invited to the chemistry laboratory of Queens School Enugu.

The experiment consists of a pre-practical session where the first set of

questionnaires (ie. the consumer survey questionnaires) were distributed. The

subjects were required to f i H the questionnaires before the food drinks were

served. Each subject was required $0 write hisher name on the questionnaire for

identification.

The second questionnaire was shared just before the food drinks were

served. Four brands which were considered most populars were used. These

include Bournvita, Milo, Ovaltine and Nescao. i

Procedure b'

I . Participants were required to first complete the Quali@ing questionnaire.

'I'hc subjects were required to indicate his name on the questionnaire before

returning it.

2. The subjects were served a cup of hot food drink. The drink is prepared

with 50mls of water and two table spoons of the brand being prepared. Brands

A,B,C,D are served one after the other. The subjects were asked to rinse their

mouths aiter drinking each brand. Sugar and milk were not added at all.

3 . The subjects were asked to identifjl each food drink in turn . Brand A = Bournvita, B = Mile,] C= Nescao, D = Ovaltine

The questionnaires used for the Blind Taste Test is shown in Appendix

CHAPTER FOUR

PRESENTATION AND ANALYSIS OF DATA

4.1 INTRODUCTION:

T w o classes of primary data were used for this study; one

obtained through consumers' survey and the other through the

laboratory (Blind) Taste Experiment. )i

A total of 270 consumer survey questionnaires were

administered in the field survey, out of which 242 were returned

representing a response rate of 89.6%. However 23 questionnaires

out of the number which represent 9.5% could not pass the validity

test after editing. This is either because of non-completion or

contradictory information. Thus w e were left wi th 219 valid

questionnaires representing a usage'rate of 81 .I % of the total survey

questionnaires or 90.5% of,the returned questionnaires.

The overall response ratio is as presented in tables 4.1 and 4.2

below.

TABLE 4.1 RESPONSE RATIO OF SURVEY QUESTIONNAIRE

( QUESTIONNAIRE 1 270 1 1 00 I 1 RETURNED 1 242 1 89.6 1

Table 4.2 USAGE RATIO OF SURVEY QUESTIONNAIRE I I I I

UNRETURNED

1 ACCEPTED 1 2 1 9 I 90.5 I

28

NUMBER

10.4

PERCENTAGES

%

I TOTAL 1 2 4 2 I l o o I REJECTED

For the blind test, a total of 150 resp&ndents were used. Out

of this number the questionnaires of 42 respondents were rejected

-- --

23

and 108 were accepted. Those rejected were due to discrepancies

- -- - - -

9.5

or contradictions in their responses in the first and second

questionnaires i.e the survey questionnaire and blind taste

questionnaires. The usage ratio of the Blind Taste test

questionnaire is presented in table below;

5 4

TABLE 4.3 USAGE RATIO OF THE BLIND TASTE TEST

QUESTIONNAIRE 3,

NUMBER

1 TOTAL I 1 50 I 100.0 I

PERCENTAGE

ACCEPTED

REJECTED

CONSUMER SURVEY RESULTS

One of the major objectives of this study is to ascertain whether

cocoa food drink consumers are loyal to any of the brands of food

drinks. Based on this, consumers were asked to mention their most

preferred brand and indicate how often they buy the same brand on a

five point rating scale that ranges from "Not at all" (one point) to

"always" (five point), The ratings of four and above are considered

108

42

brand loyal while ratings below four are considered non-loyal. Table 4.4 t

72.0

28.0

shows the percentage scores of consumers responses.

TABLE 4.4 CONSISTENCY OF CONSUMER PURCHASE PATTERN

CLASSIFIED INTO TWO

1 BRAND LOYAL

NUMBER

PERCENTAGE

NON-LOYAL

131

60%

TOTAL

88

40%

21 9

100%

This result shows that 60% of the respond&its claim to be

loyal to a particular brand.

HYPOTHESIS I: Cocoa food drink consumers are loyal to particular

brands.

Notwithstanding that more than half (60%) of the respondents

claim to be brand loyal to their favourite brands of food drinks, for the

hypothesis to be accepted or rejected, it has to be shown that the

two values (percentages for loyal and non-loyal consumers) are not

comparable.

To establish this, the results of table 4.4 are subjected to a

T-test for mutually exclusive proportions. The unequal percentages

were found to be significantly different at both 5% and 1 % levels of

significance (Appendix 1 1 A).

Therefore having found the two proportions to be significantly

different, thus satisfying the 'condition for the hypothesis to be

accepted, hypothesis 1 was accordingly accepted.

It is not just enough to establish the exi7tence of brand loyalty I

i of consumers to their favourite brands. This study is also interested

in the extent of loyalty and how this l~ya l t y~ re la tes to individual

brands. To achieve this, the consumers ranking of the brands

according to their preferences were subjected to analysis of variance.

TABLE 4.5

CONSUMERS PREFERENCE RANKING OF BRANDS OF FOOD DRINKS.

TOTAL SCOREI MEAN SCOW I R-E I

ANOVA TABLE

8 18

1,414

968

680

1,865

1,652

SOURCE SUM OF 1 DECREES OF - 7 1 SQUARES FREEDOM

2.33714286

4.04

2.76

1. 94285714

5. 32857143

4.72

POSITION 5TH

3RD

4TH

6TH

1 ST

2ND

5 7

Bournvita has the highest mean of 5.3 followed by Ovaltine

(4.72), Milo (4.04) Nescao (2.76) Pronto (2.34) q ~ d Vitalo has the lowest

value of 1.94.

These means subjected to analysis of variance show a

significant difference in using the F-Ratio for comparison of means of

consumer preference ranking for various brands at both 5% and 1%

levels of significance. Thus were choice to be considered synonymous

with loyalty, Bournvita would be enjoying the strongest loyalty and

Vitalo the least loyalty having ranked 1" and 6Ih respectively. .

Hypothesis I I : Price is an important influence in the choice and

brand loyalty for cocoa beverages.

In a depressed economy like ours, price of goods and services

likely exerts a strong influence in the choice and loyalty of not just food

drinks but also for most of the household essentials. This speculation

was corroborated by the result of the consumer survey.

In the investigation of price influence on the choice and loyalty

to brands, the result shows most of the consumers claiming only a

moderate influence of price on their choice. TH'e fire point scale on

the strength of price influence ranging from very strongly to not at all

shows the percentage response presented below in Table 4.6.

CONSUMERS RESPONSES ON DEGREE OF PRICE INFLUENCE

However for the hypothesis to be accepted or rejected, it has

to be proved that should the price of the consumers favourite brand

be increased considerably, helshe will definitely buy the same brand.

This is one sure way of proving the loyalty of consumers to .their

favourite brands. Loyal consumers are consistent in their choice of

their brands irrespective of the prices or at least, within a

1

considerable price range. The consumers were therefore asked what

their reaction would be should there be a considerable increase in the

price of their favourite brand. A five point scale ranging from

"definitely will buy" to "definitely will not buy " was further coded

into two proportions. This gives rise to one proportion of those who

remain loyal inspite of the price increase in theirfavourite brands and

the other proportion of those who will no longer buy their preferred

brand because of a price increase. The survey results show that 51%

remained loyal while 49% would not be loyal in event of a price

increase. This gives a direction t o Table 4.6 above ie this now

implies that quite a good number of consumers are influenced by

price.

I

#.

TABLE 4.7 1 I i CONSUMERS RESPONSES ON PRICE CLASSIFIED INTO TWO

I LOYAL ( NON-LOYAL 1 TOTAL 1

t

The proportion of loyal consumers and that of non-loyal #

!

consumers were subjected t o tests of comparability. The hypothesis

NUMBER - - PERCENTAGE

will be accepted if the t w o proportions (ie for loyal and non-loyal

consumers) are comparable. That is t o say that with an increase in i

112

5 1%

107

49%

219

100%

price of the consumer?^ favourite brand, the Pproportion of loyal

consumers were no longer significantly differ'ent due to the influence

b.

of price on loyalty of consumers. Thus t he ' two proportions were

subjected to a two tail T-test and found not to be significantly

different at both 5% and 1 % levels of significance (see Appendix 110).

The condition is thus fulfilled to accept hypothesis II which is

accepted accordingly. .A further investigation of the influence of price

on brand loyalty across income groups reveals that degree of

influence does not depend on the income group. There is very little

difference in the degree of price influence on the consumers of 'the

various income groups. These little variations do not show any

consisterit direction.

The F-Ratio of the ANOVA table below shows that there is no

significant difference in the degree of price influence across the ,

various income groups. This therefore implies that price is an

important consideration irrespective of the income group.

TABLE 4.8 w

DEGREE OF PRICE INFLUENCE ON CONSUMERS IN THEIR CHOICE OF

BRANDS ACCORDING TO INCOME GROUPS.

INCOME TOTAL GROUP 1 SCORE

MEAN N' I GROUPS

LOW INCOME

1-1 I G 1-1 INCOME

Hypothesis Ill: Consumers perception of the quality of the food. . drinks have significant impact on brand loyalty.

The perceived quality or attribu-tes o f , the various brands

A = UE'I'W EEN

E=WI'THIN

rcE

deFinitely differ from one consumer :.:I another. This hypothesis seeks

489

2 16

142

t o find out the extent the need satisfying attributes namely:-

SUM OF SQUARES

SA = .328945 16

SBz359.788194

Nutritional value, taste, sugar level, milk content and dissolvability of I

113

59 "

h

47 .

the brands attract and sustain loyalty of consumers t o particular

3. 25414365

3. 32631579

3. 2702027

DEGREES OF FREEDOM

A-1 = 2

N-A = 216

MEAN SQUARE

0. 16 447258

1. 03685358

brands. Therefore for the hypothesis t o be true, the proportion of

consumers who consider the attributes important influence on their

loyalty t o brands must be significantly different f rom those who do

not. Secondly the consumers perceived level' of importance of the

various attributes (represented by the mean scores values) has t o be

significantly different for all the attributes.

The T-Test for comparability of the proportions shows a

significant difference between the proportions of those who consider

the attributes an important influence on loyalty and those who do not

at both 5 % and 1 % levels of significance (see Appendix IIC).

Furthermore, the consumers ranking of" the levei of importance 1 i

of each attributes shows a s igni f icmt d i f f e reke in the means of the

attributes as indicated by the F-Ratio.

This is presented in table 4.9 below

TABLE 4.9a: CONSUMERS PERCEPTION OF ATTRIBUTES

[ A T T R ~ B U T E S E SIZE MEAN

ANOVA TABLE + I -?J?

Thus the t w o conditions having been satisfied hypothesis 111 . .

was therefore accepted.

A quick pairwise comparison of the attributes as shown in table

4.1 0 below made possible another generalisation. The conclusion that

can be drawn from .this table is that the order of decreasing

importance of the attributes influence on loyalty is as follows:-

GROUPS

Mr I'I'I-11 N GliOlJI'S

TOTAL ---

Nutritional value, milk content, taste, dissolvability and sugar content.

F-RATIO

57. 0922

s I

Thus I ~ ) ~ a l t y is mostly influenced i i y nutritiopal value and least by c

PROB.

< .0001

SUM OF SQUARE

-- S

532. 686

2542. 502

- 3075. 180

sugar content. . .

DF

4

1,090

1,094 .. -

MEAN SQUARE

S

133. 1715

2. 33257

TABLE .& ' ( 2

b'

PAIRWISE COMPARISON OF MEANS OF ATTRIBUTES

IMILK L'ONTEN - - - - - I ' A'fSE

SUGAR C'ON'I'ENT

-- MILK

CONTENT

0

1.84

10.1678***

-- 3.0973***

-

TASTE SUGAR CONTENT

10.1678**

-- DISSOLV- ABILITY

3.0973**

- 1.25

-7 .O7O6**

0

NUTRITION AL VALUE

-4.5051**

Significant at 5 % level of significance

* * - Significant at 1 % level of significance

Another purpose of the study was t o investigate the influence

of brand name and company image on the loyalty of consumers to

their brands of choice.

Hypothesis IV: Company image and brand name contribute

significantly t o ,consumers loyalty to particular

brands. I

The import of this hypothesis is based on the fact that company

and brand images .vary significantly for 'different brands and

companies of cocoa food drinks. The perception 8f consumers as to

h e popularity of brands and pursuit of excellence in quality differ from

one brand to another and from company to company.

A multiple regression analysis wi th brand loyalty as the

dependent variable and brand name and company image as

independent variable is as presented below.

TABLE 4.1 1

RELATIONSHIP BETWEEN BRAND LOYALTY AND (COMPANY IMAGE

& BRAND NAME)

MULTIPLE REGRESSION SUMMARY TABLE

DEPENDENT VARIABLE: BRAND LOYALTY

MULTIPLE REGRESSION COEFFICIENT: 1816

STANDARD ERROR OF ESTIMATE: 1.3209

PROB. I BRAND NAME

COMPANY . IMAGE L-

0. 51 3997

0. 03681 1

0. 082953

0. 082439

2. 577326

0. 44651 8

This shows that 51.4% of brand loyaity .can be explained by

popularity of brand name while only about ,3.7,% of the same can be

explained by company image.

This implies that there is a strong correlation between brand

loyalty and brand name while the same could not be sa ido f company +

image.

The T-value f rom table 4.1 1 confirms that the correlation

between brand loyalty and brand name is significant at both 5% and

1 % levels of significance, w h ~ l e the correlation between brand loyalty

and company image is not significant both at 5% and 1 % levels of

significance. Thus whereas consumers consider brand name a strong

influence on loyalty, t l iey do not consider. company image as an *

important influence.

Consequently, hypothesis IV was accepted w i th a slight

modification. That brand name exerts a strong influence on loyalty

while company image is not such as important chsiderat ion.

4.3 BLIND TASTE TEST (EXPERIMENT) RESULTS

To determine if consumers brand preference is a real or mere

psychological phenomenon, after indicating their most preferred

brands to which they are loyal, consumers ,who responded to the

survey questionnaires were again asked to identify their most

preferred brand from four brands now disguised.

Table 4.12 shows a the outcome of the experiment conducted

with 108 valid responses of consumers of food drinks, out of which

65 (60.19%) correctly identified their most preferred brands while 43

(39.81 %) failed the test.

TABLE 4.1 2

IDENTIFICATION OF MOST PREFERRED BRAND %

CORRECT INDENTIFICATION

INCORRECT INDENTIFICATION

'TOTAL

NUMBER 6 5

4 3

108

PERCENTAGES 60.19%

39.81%

100%

Source: Blind taste test (Experiment) Data fa

Is this result significant?

Hypothesis V: Consumers can identify their favourite brands in a

blind taste test.

Since the number of brand used' for the. experiment was four

the probability that a consumer identified his most preferred brand

correctly by chance even though in reality he could not discriminate

correctly is 114. Our task therefore was to show that the

experimental result of 60.1 9% was significantly more than that which t

could be attributed to chance. The test was found to be significant

and it was accordingly concluded that consumers could identify their

most preferred brands when disguised with other brands (Details of

the statistical test can be found in Appendix 11D).

It has only been shown that consumers could correctly ,

discriminate against non-favourite brands when the task is to identify

most preferred brand. But how skilled is the consumer when he is

expected to indicate his order of preference of all four brands. The

I

degree of consistency the consumer exhibited in ordering the brands

69

according to his preference before (when h e f i a d not tasted the

brands) and after the experiment (when he had tasted the brands

would provide further evidence to the consumers ability to distinguish

between brands.

Table 4.1 3 shows the consumer preferences rankings of brands

before and after the experiment. (Blind Taste test).

TABLE 4.13

CONSUMER PREFERENCE RANKING OF BRANDS AND AFTER THE

BLIND TASTE TEST.

RANK

NESCAO

Source: Blind taste test (Experiment) Date. .

Figures in the matrix correspond to frequencies of mention of

brands for the ranks ie (Ist, 2nd, 3rd and 4th). Entries in parenthesis I

correspond to before the experiment frequencies' values as

calculated by the computer

* * - Not significant at 5%

* * * - Not significant at both 5% and 1 %.

In the final analysis, the cummulative effect of the chi-square

was found to be significant. This means that on the overall

consumers ranking before and after the experiment were inconsistent

with their rankings after the experiment.

However, when the individual ranks of a brand was isolated

and considered as such it was found that consumers were consistent

in their rankings. Bournvita at both 5% and 1 % levels of significance.

Furthermore table 4.13 above was weighted to produce table 4.14

below.

TABLE 4.14

TABLE 4.14 w

WEIGHTED CONSUMERS PREFERENCE RANKING OF BRANDS

BEFORE AND AFTER

p v

MILO 23 (1)

HE BLIND TASTE TEST.

Note: Entries in parenthesis correspond t o

BEFORE THE EXPERIMENT

Source: Blind taste test (Experiment) 'Data.

The idea was t o compar,e the derived rank order befo w i th that

obtained after the experiment.' Based o,n, the spearmans rank

correlation theory, a measure of the.degree of association between the

t w o sets of response could be taken. The correlation coefficient rs

was found to be 0.400 which indicated that generally, the ranking

after the experiment weakly reflects the rOdnkings before the

experiment.

However

h I

having proved that consumers ability t o identify their

favourite brands was more than could be attributed to chance,

Hypothesis V was accordingly accepted. Notwithstanding consumers

ability to be consistent in their ranking of brands is lacking. It is

noteworthy however, that those consumers who claim loyalty to

particular brands were able to discriminate their favourite brands

among others when disguised.

4.4 DISCUSSION OF RESULTS:

In the presentation and analysis ,of data the objectives was

mainly to subject the raw data derived from both the consumer . survey and laboratory blind taste experiment to statistical tests.

Consequently, it was possible to draw statistical inferences from such

tests.

In this section however, the objective is to provide logical and r

theoretical constructs for some of the findings in a very clear manner.

4.4.1 EXISTENCE OF BRAND LOYALTY:

The most important focus of the study was to determine the

existence or otherwise of consumers loyalty to existing brands of

food drinks. The result shows that a sizeable qumber of consumers

are brand loyal to their favourite brands. This result therefore led to

the accepting of the following hypothesis:

Cocoa food drink consumers are loyal to particular brands.

This result is not surprising. Habitual purchasing behaviour is

the result of consumer learning from reinforcement. Consumers will

repeatedly buy what brand satisfies them best. . This behaviour leads

to brand loyalty. A number of scholars such as Ehrenberg and

Goodhart however are of the opinion that consumers actually do buy

from a set of brand portfolio for different product classes. It is

noteworthy that they also arrived at the conclusion that repetitive

purchase of brand leads to favourite attitude and loyalty to the brand.

In the case of this study,'consumers loyalty to the particular brands is , supported by strong industrial practices. This is why many managers

are not thrown into panic by introduction of Kew brands into the

industry and Nigerian markets. Rather they concentrate on

advertising to sustain loyalty. Creating brand loyalty is a major

concern to marketers more than just increasing the market share.

4.42 PRICE AND BRAND LOYALTY

Introducing the Marshallian (Economic) model we noted that

the individual buyer seeks to spend his inccme on those goods and

services that will deliver the most utility (satisYaction) according to his

taste and relative prices. This argument readily suggests that price

has a great influence on consumers.

The result of the study shows that despite claims of loyalty t o

brands by consumers, price is a major influence on loyalty of 9

I

consumers. Thus the hypothesis; Price is an important influence in

the choice and loyalty for cocoa beverages was accepted. This is not

surprising given the serious distress in the world economy .and

especially in Nigeria. i

b' In a recent research session a brand loyalty a panelist noted, "I

used to use just Betty crocker mixes but now I think of either Betty

Crocker or Duncan Hines depending on which is on sale" Another

participant said, pennies count now, I read the ingredients. I don't

really understand but I can tell if its exactly the same. So now I use

the cheaper brand and honesty, it works just as well.

This simply leads weight to the findings of this work. The

economic hardship has in no small measure reduced the loyalty of

consumers to not just food drinks but many other product classes by

pushing them to buy cheaper alternatives.

Many managers pay more attention t o non-price factors than to

price. This result should sound as a warning to brand managers in !.

the food drink industry especially as it is 'yet doubtful whether food

drinks belong to the high involvement product class and differences

between existing brands may not be so distinc!. Therefore arbitrary

increases in price is likely to endanger sales due to possible brand

switching. i

4.4.3 CONSUMERS PERCEPTION OF ATTRIBUTE% INFLUENCE ON

LOYALTY

Consumers are generally reputed to have is set of brand beliefs

- beliefs about where each brand stands on each attribute. It wa's in

a bid to find out the implication of this assertion that hypothesis Ill

was postulated.

Hypothesis Ill: Consumers perception of the quality (attributes)

of the food drinks have significant impact on brand loyalty.

This hypothesis was found to be true. An important implication

of this finding is that consumers are knowledgeable and not as

gullible and manipulatable as critics of advertising would suggest.

When Peryam and Pilgrim argued that the acceptance of

products involves psychographic reactions to the various attributes of

that product, the meaning they were trying to convey is not that such

attributes have equal weights. Nutritional value was found to be the .. .I

most important attribute considered in loyalty fo particular brands.

DEGREE OF ATTRIBUTE INFLUENCE ON eONSUMERS

Important

Very Important 5.00

4.75

4.50

4.25

4.00

3.75

3.50

3.25

aoo

' 2.75

2.50

225

Somewhat Important

1.75

150

125

Not Important at all 100

NUTRITION VALUE

MILK CONTENT - TASTE

-4 DlSSMVABlUN

- SUGAR CONTENT

Thus it is a sound marketing practice to emphasise heavily on

Nutritional value in the adverfising of the brands. Presently most of

the established popular brands make claims of high nutritional values

as their unique selling proposition. The extent the consumers

perceive the presence of these attributes in the various brands i

therefore go a long way to sustain brand loyalty.

4.4.4 BRAND NAME, COMPANY IMAGE AND BR#ND LOYALTY

This study also, examined the relationship between brand

loyalty and brand name and company image.

Hypothesis IV: Company image and brand name contribute

significantly to consumers loyalty to

particular brands.

The result shows that brand name exerts a strong influence on

&"

consumers loyalty while company image is not an important

consideration. This explains why some of the food drinks companies

with more than one brand have the popular brands showing a good

market performance while the unpopular brands make little or no

impact in the food drink market. For instance in the ranking of the six

brands covered by this study, Bournvita and Pronto ranked 1st and

5th respectively though both, belong to Cadburys product portfolio.

The importance of,brand name as a factor influencing choice . .

and loyalty does not contradict any plausible marketing theory. As an

attribute, brand name rnay be seen as a condensation of many other i

product sub-features. Its more than a mere alphabetical arrangement.

'r it con

79

:s of the brand's typography, co'fou ckage, d esi

promotional slogans and the general image of the owner of the brand.

Theoretical support can also be derived from the Freudian hypothesis

that choice behaviour is largely a symbolic process. When purchases

cease to be influenced by economic variables consumers given their

experiences and personalities become vulnerable to making purchases

without any substantial degree of deliberation. This is perhaps why

such companies as Cadbury and Nestle who acquired the names of

foreign brands are not in any hurry to drop such names.

The implication for marketers therefore is the challenge of

L c

choosing suitable and captive brand' names which are

commensuratively supported by good quality of the product.

4.4.5 REALITY OF CONSUMERS PREFERENCES

Consumers of food drinks are knowledge people. They may

not be as gullible and manipulatable as some people would assume.

Some consumers are really loyal to particular brands. i

It was necessary to find out whether thiS' loyalty was a mere

empty claim or not. Brand loyal consumers who through familiarity

with the brand can identify their favourite brand when disguised.

This claim was substantiated in this study as consumers were

able to identify their preferred brands though they failed to make a

ranking of the overall preference of the brands under the laboratory

conditions that was consistent with rankings under control b.

i

conditions.

This therefore confirms the result of hypothesis one that

consumers are loyal to particular brands of cocoa food drinks.

NOTES ON CHAPTER FOUR'

1 . Henry Assael, Consumer Behaviour and Marketing Action 4th

ed. (Boston, Kent. 1993) p.89.

2. Robert East, Changing Consumer Behaviour (Cassel Educational

Limited 19931, pp. 47 - 57.

3. LW lamb and J. F. Har Jnr. Princl;oles of Marketing (South

Western Publishing Coy. Cincinnati Ohio USA 1994) pp. 44

4. D:R Peryam and F.J. Pilgrin, The Hedonic Scale Method of

Measuring Food Preferences", Food te'chnology Vol. /I, No. 9

5. This Phenomenonjs discussed in Philip Kotler, Behavioural

Models, for Analysing Buyer's Behaviour, Journal of Marketing,

Vol. 29 (Octob&, l965) , pp. 181 - 184.

CHAPTER FIVE P

SUMMARY, IMPLICATIONS AND RECOMMENDATIONS

CONCLUSIONS

AND AREAS FOR FURTHER RESEARCH

5.1 SUMMARY OF FINDINGS

1. This study established that the consumers of cocoa food drinks

are, to a reasonable extent loyal to particular brands. In every

ten consumers of food drinks, six of them are loyal to particular

Brands.

2. 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. a.

3. Consumers have basic expectations in their favorite brands.

consumers consider the attribute 'important in the following

order I

Nutritional value

Milk Content

Taste

Sugar level

Dissolvability

4. Brand name is an important influence on consumers loyalty t o

particular Brands. However, company image is not considered

important.

5. The claim of loyalty t o particular brands is true and real since

they were able t o identify their most preferred Bands

disguised.

5.2 IMPLICATIONS OF THE STUDY AND RECOMMENDATIONS

This study established the existence of brand loyalty amongst

cocoa food drink consumers. A n important implication of this result is I

that new entrants into the market will have a difficult task penetrating

the market. Such companies will relatively make little impact in the

food drink market. Existing Brands also will neZd t o exert a more than

I

average effort t o increase their market share.

It is obvious from the result that the extent of loyalty (six in

every ten) is nothing for any manager to rest on his oars. Brand

loyalty is a result of combination of many marketing variables.

Therefore the companies should further ascertain what about their

brands islare of utmost importance to consumers and exploit i t to

build and/or improve the loyalty of consumers to their brands.

Another important deduction from the study is that price is an

important influence on bra'nd loyalty. The economic hardship in the

country is biting hard across all the income groups. Most consumers

will switch to cheaper brands as their favourite brands become more

expensive. This may be explains 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 a good development when your

loyal consumers have an easy opportunity to try other brands. Many

of the big names in the industry like Cadburg have sensed the danger

and resorted to product differentiation or even outright introduction of

cheaper brands.

t

Efforts should be increased on the l op1 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 contributes to the grooming of a healthy community. One

way of formalizing responsibility in this regard is with industry code of

conduct of ethical conduct that prescribes and enforces minimum

nutrient requirements in food drinks. But it is doubtful i f industry's

self regulation through the instrumentality of codes of conduct can

be as genuinely effective as some other measures with externalities. I

For this reason the National Agency for Food and Drug Administration

and Control (NAFDAC) should prescribe a'nd enforce to the letter the

basic nutrient requirements in food drinks especially in the new i

brands being introduced into the Nigerian market.

Another interesting conclusion drawn frqg-n the study is that

company image does not influence loyalty why brand name exerts a i b.

great influence on loyalty. Companies that are keen on introducing

new brands should therefore bear in mind that the big name of the

company may not attract patronage and loyalty to the new brands.

Rather they should focus on good quality of the product and

heavy advertising on the popular brand names already existing in the

market. This will help sustain loyalty of consumers.

5.3 AREAS FOR FURTHER RESEARCH

The issue of brand loyalty is a covert consumer behaviour.

There certainly has to be many underlying variables.

There is a need t o really find out the influence of Advertising

and Commercial Sponsorship in building of loyalty to brands. In the

case of Commercial Sponsorship, empirical evidence is needed to %

validate its theoretically and conceptually advanced benefits. i

Secondly, it is also an important issue to dieterrnine when brand

loyalty is actually developed. Is it as a child or an adult and what role

does each member of the family play in loyalty to particular brands.

Finally the issue of store loyalty and shopping habits of

consumers as major determinants of brand loyalty is worthy of C.

investigation.

5.4 CONCLUSION

This study has been a painstaking effort geared towards

ensuring authentic results which have practical applications in the

food drink industry.

This study has vindicated the claim of brand loyalty to

particular brands, an obvious indication of the conservatism and

inertia of consumers. This did not however give any company the

opportunity to glory in its past marketing successes. Such a mentality

is capable of enslaving them to their own history, corporate culture

and management psychology, making sales growth and general

growth impossible. i

This study also demonstrates that Marbting Experiment as a

means of discovery is a powerful method of obtaining experience and

information. It is quite possible, though painstaking, it should be

encouraged.

)r

BIBLIOGRAPHY

JOURNALS

1. Blatterg, Robert C. and Sen, Subrats K. "Market Segments and

Stochastic Brand Choice Models", Journal of Marketinq (February,

1 996).

2. Brown, George Brand Loyalty; Fact or Fiction ", Advertising Aqe

(January, 1953).

3. ' Celsi Richard and Oslon Jerry C. "The Role of lnvolvement in

Attention and Comprehension Process", Journal of Consumer

Research Vol. 15 September, 1998.

4. Day, George S. "A Two Dimensional C,oncept of Brand Loyalty",

Journal of Advertisinq Research Vol. 9 (September, 1969).

5. Day, Paul. "The New Consumer Values", Advertising Quarterly No. 56

(Summer 1 978). I

6. Jacoby Jacob and Kyner B. David, "Brand Loyalty Vs Repeat

Purchasing Behaviour Journal of Marketing Research Vol. 10

(February, 1 973).

9 0 kr

Kapferer, Jean-Noel and Laurent, Gilles, "Consumer Involvement

Profiles: A New Practical Approach to Consumer Involvement".

Journal of Advertising Research. (December 1985 - January, 1986).

Keun, Alfred, and Ralph. "Strategy of Product Quality", Harvard

Business Review, Vo1.49 No. 6 (Nov.-December, 1962).

Levitt TheodoreInMarketing Myopia", Harvard Business Review

(August 1960).

Lynn Sharon and Beatty, Kahle R. Homer Pamela "The involvement-

Commitment Model: Theory and Implications", Journal of Business

Research Vol. 16 (June 1978).

Massey William and Frank Ronald .Short Term Price and Dealing

Effects in Selected Markets, Journal of Marketing Research Vol 2

(May 1 987).

Mckenna Regis. "Marketing is Everything" Harvard Business Review

Vol. 87 No. 9, May, 1987. #

Peryam D. R and Pilgrim F. J. "The ,Hedonic Scale Method of

Measuring Food Preference". Food Technology Vol. I1 No. 9, (1 957).

Solomon Michale R. "The Missing Link: Surrogate Consumers in

ts Marketing Chains. Journal of Marketing, Vol. 50 (October, 1980).

15. Tucker W, T. "The Development of Brand Loyalty". Journal of

Marketing Research 1 (August, 1964).

92

W BOOKS

Assael, Henry Consumer Behaviour and Marketinq Actions 4'h ed.

(Boston: Kent, 1993).

East, Robert. Changing Consumer Behaviour (Cassel Educational

Limited 1993).

Ekechi T. 0. E. "Critical Factors Influencing Brand Choice of Food

Drinks in Enugu Metropolis (MBA Thesis University of Nigeria 1986).

Engel, J. F., Blackwell R. D. and Kollat P. M. Consumer Behaviour 3rd

ed. (I-lolt Rinehard and Wiston, New York 1978). -

Hart N. A. and Stapleton John. Glossary of Marketing Terms 2nd ed.

(London: William Heinemann Ltd, 1981).

Howard J. A and Seth J. N., The Theory of Buyer Behaviour, (John

Wiley and Sons, New York, 1969).

Jacoby Jacob and Chestnut Robert. "Brand Loyaltv: Measurement I

and Management. (New York: John Wiley Inc. ans Sons, 1978).

Kassarijan, Harold H. and Kassarijan Waltrand M. Attitudes Under

Low Commitment Conditions in John C. Maloney and Bernard i

silverman eds. Attitude Research Plays for High Stakes (Chicago:

t; American Marketing Association 1979);

Kotler, Philip. Marketinq Manaqement: Analysis, Planning and Control

6Ih ed. (Englewood, New Jersey: Prentice Hall Inc., 1994)

Lamb C. W and Hair J. F. Principles of Marketing (South Western

Publishing Coy. Cincinnati, Ohio USA 1994).

London D. L. and Bitta, Albert J. Della. "Consumer Behaviour,

Concepts and Applications (NY McGraw Hill inc. 1993).

Lutz Richard J and Bettman James R. Multi Attributes Models in

Marketing: A Bicentennial Review as in Consumer and Industrial

Buying Behaviour, Arch. G. Woodide, Jegdish N. Sheth and Bennet

eds. (New York: North Holland Publishing Coy.: 1977).

Nemmers Erwin E. Managerial Economics (NY: John Wiley and Sons

I nc. 1 962).

Nicosia F. M. Consumer Decision Processes (Englewood Cliff. New

Jersey Prentice Hall, 1966)..

0' Shaughnessy, John. Competitive ' ~ a r k e t i n ~ znd ed. (London:

Briddles Ltd., Guilford and King'slyn, 1998).

Osion Peter. Consumer Del~nviour and Marketing Strategy, (richard \

. 94

Y Irwin Inc. Boston, 1993).

17. Osvalsky Solomon and Richard W. Perceived Quality Consumers

Decision Making: an Integrated Theoretical Perspective in Perceived

Qualitv: How Consumers View Stores and .Merchandise, eds. Jacob

Jacoby and C. Oslon (Lexington, M. A. Lexington Books, 1985).

18. Reibstein David J, Marketing Concepts, Strategies and Decisions

(Englewood Cliffs, Prentice Hall Inc. l985),

19. Schifman Leon and Kanuk Leslie Kaza. Consumer Behaviour

(Englewood Cliffs New Jersey Prentice Hall Inc. 1993.

20. Vroom H. Victor. Work and Motivation (New York: John Wiley Inc. and

Sons 1964).

APPENDIX IA

SCHOOL OF POSTGRADUATE STUDIES

(MBA UNIT - MARKETING)

UNIVERSITY OF NIGERIA ENUGU CAMPUS

Dear Respondent,

Questionnaire on Food Drinks. This..questionnaire is intended

for use in research work. Please answer eacf'~ question sincerely. Your 4

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. (Food

drinks refer to such drinks as Bournvita, Pronto, Milo, Ovaltine,

Nescao, etc).

1. Do you take food drinks in your home?

Yes ............................ No. ..................................

.................................................. 2. If no please indicate why i

3. What is your status in the family? Y

................................ .................... Husband.. DaughterISon..

Wife.. ...........................

4. Do you go to buy any particular brand of food drink?

....................... Yes ............................ N o. .. ......

5a. Mention the brand you will preferably buy .............,,.... .......

5b. Please rank the following brands according t o the order of your

preference (with the most preferred as 1 and least preferred as

Bournvita Nescao

Milo Pronto ?.

Ovaltine Vitalo

6. How often do you buy the same brand anytime you buy

Always

Very often

Occasionally

Very rarely

Not at 'all

lir

7. To what extent does the brand market price influence your

choice of food drinks

Very Strongly

Strongly

Moderately

Slightly

Very slightly

8. If the price of your favourite food drink is increased

considerably, more than the price(s) of others, you;

Definitely buy it

May buy it

Somehow may buy

May not buy it ,

Definitely will not buy. . 9. Which of the following brands will ;ou buy if the prices are the

same?

Milo

Bournvita

Ovaltine

Nescao

Pronto

Vitalo (Tick just one).

10. Does your choice of food drink depend on perceived attribute

of the brand?

Yes.. . . . . . . . . . . . . . . . . . . . . . . . . . . N o. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11. Which of these attributes determines most importantly your

choice of food drink (choose one only).

(a) Milk content

(b) Taste

(c) Sugar contentllevel

(d) Dissolvability

(e) Nutritional value. 3

12. Rank the following attributes on the'level of importance in the

choice of food drink.

Inlporlatlt at all

ask

Dissolvabili

Itnportant Important LT

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

choice of food drink?

Very Strongly

Strongly

Moderately

Slightly

Very slightly

100

14. To what extent are you influenced by bra@ popularity in your

choice of food drink.

Very Strongly

Strongly

Moderately

Slightly

Very slightly

15. Please state the level of your income

(a) Low income (b) Middle income (c) Upper income

16. What is the level of your education?

(a) B.Sc and.above (b) NCEIOND

(c) GCEISSCE (d) Primary Six.

101

APPENDIX IB rv

SCHOOL OF POSTGRADUATE STUDIES

(MBA UNIT - MARKETING)

UNIVERSITY OF NIGERIA ENUGU CAMPUS h

BLIND TASTE TEST QUESTIONNAIRE

This questionnaire is part of the instrument designed to collect

information for the investigation of consumer loyalty t o brands of

cocoa ,food drinks.

Procedure:

1. You will be served a cup of hot food drinks disguised as A, B,

C, D in turn.

2. Your are required to identify the brands.

3. After each brand is served, use the cup of water provided

rinse your rnouth and wipe your mouth dry.

4. The whole process is repeated until the four brands are

covered.

1. Rank the following Brands according to your preference.

Milo

Bournvita

Nescao

Ovaltine

The name of Brand A is

The name of Brand B is

The name of Brand C is

)i

The name of Brand D is

Please rank the following brands according t o your

preference

Brand A

Brand B

Brand C

Brand D

APPENDIX IIA p;r

TESTING OF HYPOTHESES

HYPOTHESIS I

Consistency in ~ u y i n g the Preferred Brand

To test the hypothesis, the responses were further categorized

P 3

into two: scores of 4 and 5 points were assigned to "very often" and

ALWAYS

63

"always" respectively and were classified as loyal while score from 3

to 1 points ranging from "occasionally" to "not at all" were classified

VERY OFTEN

68

as non loyal.

This gives rise t o two proportions of 60% for loyal consumers

and 40% for non-loyal consumers.

OCCASlO N ALLY

74

Ho = The two proportions aremot significantly different

Ha = The proportions are significantly different.

VERY RAWLY '.

10

Decision rule: eject Ho if To > Te ," . p'

NOT AT ALL

4

To = 3.03 Te = 1.533 (CL = 0.05) Since to > Te at both 5%

and 10Y0 levels of signaficance, H, is rejected.

Hence hypothesis 1 is accepted.

Note To is calculated T value, while Te is theoretical T value

from statistical tables.

OVERALL PREFERENCE RANKING OF FOOD DRINK BRANDS

TEST OF SIGNIFICANCE: PREFERENCE RANKING OF BRANDS

TABLE A 1

i

Table 4.5 is Table A1 analysed with mean scores and F-Ratio.

Ho = Mean scores are equal

PllONTO

VI'TALO

Ha = Mean scores are not all equal.

Decision rule is to reject Ho i f Fo > Fe

P

I 1

0

22

5

3 1

22

45

47

80

55

30

90

Hence Ho is rejected.

Thus mean scores of the consumers preference rankings are

significantly unequal.

APPENDIX 116 A"

HYPOTHESES l l

Price is an important influence on t h e loyalty of consumers to

particular brands.

TABLE A2

DEGREE OF PRICE INFLUENCE ON CONSUMERS

PRICE DIFFERENCE)

I( DEFINITEL I MAY BUY 1 OCCASION 1 VERY 1 NOT AT 11 1 Y,":,"" 1 j ALLY RARELY 1 ALL It

T o t e s t t h e hypothesis, t he response were further categorized

into two: scores of 4 and 5 points for "may buy" and "definitely will

buy" respectively classified a s resilient loyal consumers while those 1

with scores from 3 points t o 1 point for "somehow may buy" and

"definitely will not buy", classified a s non loyal consumers.

This gives rise to proportions of 51 % for loyal consumers and

49% of non loyal consumers.

Ho = The t w o proportions are equal

Ha = The two proportionsare signidjcantly unequal.

Decision rule: Reject Ho if To > Te

To = 0.295

T, = 1 ,533 (a = 0.05) . 5

Since To < T, at both 5% and 1 % levels of significance, Ha is

rejected.

APPENDIX IIC w

HYPOTHESES Ill

FREQUENCY DISTRIBUTION OF DEGREE OF IMPORTANCE OF

ATTRIBUTES IN CHOICE

AND PREFERENCE OF BRANDS

TABLE A 3

Test of Hypothesis

Ho = Means scores of all attributes are equal

1

D

Ha = Mean scores of all attributes are not all equal

Decision Rule: Accept Ha if Fo, (the calculated F - Ratio is greater than

the theoretical F - Ratio Fe).

#

h

Levels of significance (a ) = 5%, 1 % ie Degree of freedom = 4,

1094.

Milk Content

Tastc

S u g r Conlc~il

Dissolvability

Nutritional Value

Not Important at all

13

12

112

52

3

V W lniportant

-.

45

30

8

4

157

Not Vcry I~nprtant

16

38

58

47

6

Somcwllat Ilnprtant

38

-43

36

106 -----. I0

Important

107

96

16

10

43

F, = 2.09 ( a = 0.05) 2.80 (a = o.01) Y

Thus F, = 57.0922 > Fe (0.05, 0.01) 2.09, 2.80

Hence Ho is rejected. The mean scores are therefore not all equal.

110

APPENDIX IID w

HYPOTHESES V

IDENTIFICATION OF MOST PREFERRED BRAND

Table A 4

I- Correct Idcnti fication

Source: Blind Taste Experiment

H lncorrccl Identification TOTAL

Hypothesis: Consumers can identify their favourite Brands in a Blind

NUMBER

65

Taste Test.

60.19%

43

108

Number of brands used for experiment = 4.

39.81%

100%

Probability of correct identification by chance = % or 25%.

Number correctly identified 65 = '60.1 5%

Is this significant. '; .

F, = calculated F - Ratio =

K = Number of successive ie number of consumers who iden.

their most preferred brands - correctly

N = Number of trials = 108

P = Theoretical proportion = '%

Fe = Theoretical F - Ratio with degrees of freedom 1, 2.

Decision Rule = Reject Ho if Fo > Fe

Substituting 1 = 2(108 - 65 + 1)

Thus F, = 130(1 - %) = 97.5'

88( % ) 2 2

4.43

8 .

Fe (88, 130) degrees of freedom at 5%, 1 % lev* of significance =

1.37, 1.56 respectively.

Fo = 4.43, > Fe 1.37, 1.56

Hence Ho is rejected

Thus we conclude that the proportion 60.1 9% who identified

their brands correctly is more than which could be attributed to

chance.