A STUDY ON THE EFFECT OF MARKET SEGMENTATION AND POSITIONING IN TEXTBOOKS PUBLISHING COMPANY IN NIGERIA

CHAPTER ONE

INTRODUCTION

• BACKGROUND OF THE STUDY

The subject matter of market segmentation is the strategy that involves dividing a large market into subsets of consumer and service offered in the market.  These sub-groups of consumers can be identified by a number of different demographics depending on the purpose behind identifying the groups.  Marketing campaign are often designed and implemented based on these types of consumer segmentation.  One of the main reasons for engaging in market segmentation is to help the company understand the needs of the customer base.  Often the task is segregating consumer by specific criteria will help the company identify other application for their products that may or may not have been self-evident before.  Uncovering these other ideas for use of goods and services may help the company target a large audience in that same demographic classification and thus increase “Market share” among a specific sub-market base.

Market segmentation according to Schiffman et al (2007:44), is the process of dividing a market into distinct subsets of consumers with common needs or characteristics and selecting one or more segments to target with a distinct marketing mix.  “Selected textbook publishing companies in Enugu” who are faced with the problem of providing adequate number of high quality book, unqualified author publisher, poor production and lack of capital are all evident.  The strategy of segment allows producers to avoid head on competition in the market place by differentiating their offerings, not only on the basis of price but also through styling, packaging, promotional appeal, method of distribution and superior service.

In reality, the marketing concepts advice that, we should establish users or buyer needs, and determine if how and what extent it may be possible to satisfy these given ones existing and potential resources to the mutual bandit both parties to the exchange.

Market segmentation according to Edoga P. N. (2008:88) is the process of dividing the total market into several relatively homogeneous groups with similar product interests.  This process requires marketer to identify factors that affect purchasing decisions, so that the consumer can be group accordingly.  Marketing mixes are then adjusted to meet the needs of each target segment. Market segmentation by grouping together customer with similar needs, provides a commercially viable method of serving these customer. It is therefore  at the heart of strategic marketing since it form the basis by which marketers understand their markets and develop strategies for serving their chosen customer better than the competitors.

A market segment on the other hand is a group of individuals, groups or organization who share one or more similar characteristics that cause them to have relatively product needs.   Beyond identifying segments in the market, management must carefully consider both the strengths and the weaknesses of competitors when developing marketing strategy.  This is to aid the product-positioning task.  Market segmentation by defending the market target that management intends the firm to penetrate it establishes the segment at which the firm intends to focus its marketing efforts. Market segmentation and positioning will enable a firm to select a target from which it has a competitive advantage, so that a lasting market position, one of solid market strength can be established.

Marketing perform two basic tasks in meeting the exchange objectives.  Firstly, they design and implement marketing strategies to meet those target market objectives.  A target market is a chosen segment of market which a company has decided to serve.  As customers in the target market have similar characteristics, a single marketing mix strategy can be developed to match those requirements.  Creation segmentation may result in identification of new segments that have not been served adequately hitherto any may form attractive target market to attack.

Marketing strategies or action plan for accomplishing objectives, then are thought in terms of particular markets.   In the segmentation of textbooks publishing companies in Enugu are based upon the position that:

1. Consumers are different.
2. Differences in consumers are related to differences in the market demand and buying motives.

• Segmentation of consumers can be possible because segments of consumers can be isolated with the overall market.

1. Market target segments has sufficient demand potential to justify selection as a market target.

The benefits of market segmentation and positioning are numerous and include:

1. Tailored Marketing Mix: Market segmentation allows the grouping of customers based upon similarities (eg. Benefits through sought) that are important when designing marketing strategies. Consequently, this allows marketers to understand in-depth the requirements of segments and tailors a marketing mix package that meets their needs.  This is a fundamental step in the implementation of the marketing concept: segmentation promotes the motives of customer’s satisfaction by viewing markets as diverse sets of needs which must be understood and met by supplies.
2. Differentiation: Market segmentation allows the development of differential marketing strategies by breaking a market into its constituents sub-segments (if chosen to target more than one segment) and within each segment it can differentiate its offering from the competition a company is giving the customer a reason to buy from them rather than the competition.
3. Opportunities and Threats: Market segmentation is useful attempting to spot opportunities and threats market are rarely static. As customers become more affluent, seek new experience and develop new value new segments emerge.  The management is better able to access competitive strength weakness of greatest importance.
4. The Positioning idea must be clear in terms of both target market and differential advantage.
5. Consistency: People are bombarded with message daily to break this through this noise, a consistent message is required.
6. Credibility: The differential advantage that is chosen must be credible in the minds of the target customer.
7. Competitiveness: The differential advantage should have competitive edge. It should offer something of value to the customer which the competition failing to supply.

1.2     Statement of Problem

Generally, a great number of problems confront the application of market segmentation and positioning.   To describe market segmentation does not seem different but to put the description into practice is not easy.   Some of the problems however are particular about market segmentation and positioning in textbook publishing firms.   Some of these problems are stated in the work with the purpose of finding solution to them.

• The inability of the firm to classify their customers group according to the uniqueness in purchases.
• The segmentation and positioning is based on subject rather than based on customers/consumers and their needs.
• Inadequate transportation facilities for sales men whom their jobs require traveling from one place or customer to another.
• Inadequate sales training and education. There is simply not enough training for old and new employed salesmen hence; they lack knowledge and concept of market segmentation.
• Inability to carryout marketing survey and research. There is no provision to know how effective their strategy is and how customers responded to their offerings.   The inability to carry out market research to know the extent of homogeneity and heterogeneity of their customers also pose problems to the organization.

1.3     Objectives of the Study

Like the marketing philosophy pointed out, every marketing oriented firm or organization has the primary duty of not only making sales for the company but for the identification of customers need and planning to satisfy these customers’ needs at a profit to the firm.        For the purpose of this work, it is therefore very important to review the strategy and offerings of organization with a view to finding how effective such strategy and offering are meeting the objectives of the organization that is applying them.  It is the light of this that this work outlines the following:-

1. To know what market segmentation and positioning is all about as it involves the companies under study.
2. To know if actually the companies or organization actually applies market segmentation and positioning in the sales of its product.

• Also, to know how the company’s sales is structured. This could be geographically, regionally or customer structured and if it can determine or know its target customers.

1. The other objective of this study is also to know the method or strategy the companies actually use in performing its functions.
2. Also, the effectiveness of market segmentation and positioning strategies is achieving the firm’s goals as well as host of others.

1.4 Research Questions / Hypothesis

For the purpose of this study, the following questions will be asked:-

• What categories of customer do the firm sales to?
• How do the firms structure its sales force.
• How do the firms distribute its products?
• Do firms use market segmentation and positioning in achieving its sales objective?

For the purpose of this work, the following research hypothesis are formulated and need adequate attention hence, they will be subject to test of reliability and authority.

H_0i:    The firm does not use market segmentation and positioning to achieve greater part of her objectives.

H_0i:    The firm use market segmentation and positioning to achieve greater part of her objectives.

H₀₂:   The firm marketing operations are not regionally structured.

H₀₂:   The firm marketing operations regionally structured.

1.5       Significance of the Study

The study on the segmentation of market and positioning is very significant because many companies and organizations have had some problems to perform more profitable because of the lack of ideas to segmentation of market and positioning. This work would provide marketing/sales managers of companies and organizations in the state and the country at large with the useful tools for designing and accessing the efficacy of their market segmentation programmes.

This study is very significant and justifiable in that market segmentation and positioning and identification target markets by organization are part of the tools for the realization turnover ratio of organizations as well as development sales.

Finally, this research in this direction thereby lagging foundation for other researchers.

1.6     Scope / Delimitation of the Study

The study covers all aspects of market segmentation and positioning as an instrument for achieving organizational objectives as a whole.   The population of this study is all publishing firms in the country. However, due to time and financial constraints, a survey of selected firms in Enugu will be conducted.

Therefore, the study sample has been narrowed to seven publishing firms in Enugu, which the researcher believes is representative of the entire population.

1.7     Definitions of Terms.

1. Market:- It can be defined as a geographical location where buyers and sellers transact business.   It can also be seen as an aggregate demand by potential buyers of product or services.   Market can also been seen as people with needs to satisfy, the money to spend and the willingness to spend it whenever it becomes necessary to do so.
2. 2. Market Segmentation:- This is the process of dividing the heterogonous market into smaller division having relatively homogenous characteristics that can be satisfied by firms or the process of dividing the total market into several relatively homogenous groups with similar product.
3. 3. Positioning:-This has defined as the act of designing the company’s offering and image so that it occupies a meaningful and distinct competitive positive in the target customer mind. It is also an act of establishing a viable competitive positioning of the firm and its offerings on the selected target market.
4. 4. Market Share:-    It is the process of selecting a segment of the total market and going after it with the company’s product or closing a selected of the market with which to deal with in relation to the firm offerings.
5. Market Concept:- This is the philosophy of business which state that, the customers want for satisfaction is the economic and social justification for a firm’s existence.

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