1.1 Background of the Study
Today, company′s real value lies outside
the business itself, in the minds of potential buyers (Kapferer, 2002).
This is reflected in the value of brands, which are the anchors of
company’s value. Products are introduced, they live and disappear but
brands endure (Kapferer, 2002). The term ``brand’’ holds multiple
meanings. According to John Murphy, founder of Interbrand (Ingham,
2003), a brand is not only an actual product, but also the unique
property of a specific owner. Brands are increasingly considered to be
the primary capital in many businesses. The brand is “a name, sign,
symbol, or design, or a combination of them, intended for the goods and
services of one seller or group of sellers to differentiate them from
other sellers competitively” (Kevin & Keller 2006).
Brand facilitates customers to cater
their needs in the best possible way, having a perfect confidence in the
quality of the product as they had relied on that particular product
before. In addition, it is expected that this practice will increase the
chances of repeat purchase. If people become loyal to a brand it is
surely a great advantage for a company. For example, a repeat purchase
relates to the fact, that the company has done something good with its
consumers, therefore that holds them to stick with a brand.
Financial professionals have developed
the notion that a brand has an equity which exceeds its conventional
asset value. Therefore, the phenomenon of brand and brand equity
valuation became the centre of interest of both academic and business
experts. The main issues are how a company can build, nurture and use a
brand in order to obtain and sustain the competitive advantage in the
Brand equity is a measure of the health
of the brand. Thus, it can be used for marketing decision-making. In
addition, brand equity cannot be viewed only from the companies’
perspective, but one must be concerned with the way customers perceive
product or service brands. In the marketing literature,
operationalisation of consumer-based brand equity usually falls into two
groups (Cobb-Walgren et al., 2005, Yoo and Donthu, 2001): consumer
perception (brand awareness, brand associations, perceived quality) and
consumer behaviour (brand loyalty, willingness to pay a high price).
The key sources of brand equity
suggested by Aaker (2001) incorporate both perceptual and behavioural
dimensions in the definition, whereas Lassar et al. (2005) strictly
distinguish the perceptual dimension from the behavioural dimension, so
that behaviour is a consequence of brand equity rather than the brand
1.2 Statement of the Problems
Beverage firms are playing an important
role in the economy of every country. As the beverage industry is
growing faster and it is also expected that future growth June be higher
than present. Therefore, it presents to the marketers some
opportunities and threats. As far as opportunities are concerned, in
growing industry firms have chances to increase their market shares. But
this rewarding opening is also with some threats as this June attract
many other local, national and international firms jump into that
business. Therefore, in order to maintain their competitive position
firms have to work on their brand loyalties. As these are low
involvement products, therefore consumers June switch to other brands
more often. Thus, marketers and brand managers need to be more
interested in knowing about the antecedents of brand loyalty in Port
The determinants of brand loyalty cannot
be consistent in developing and developed economies. Some of the
manufacturing firms, especially the food and beverage companies that are
still in business and are listed in Nigeria stock exchange find it
difficult pay dividend to their shareholders. Notable example include
Champion Breweries which has not paid dividend since1988, Golden
Breweries has not paid since 1997 (salandeen, 2001). Some Nigeria
workers were forcefully disengaged from their services, example Ajaokuta
steel industry reduced their staff from five thousand to one thousand
in 2007, despite the above scenario, the companies post huge figures of
their accounts receivables. It is as a result of the above problem that
the researchers deemed it necessary to examine the effect of receivables
management on corporate profitability of food and beverages
manufacturing firms quoted on the Nigerian stock exchange.
Substantial research has been done to
analyze a brand loyalty for various categories of products and services
around the globe. As, Nguyen, Barrett and miller (2010) found that due
to dissimilarity in developing and developed markets, to manage
international brands in emerging markets and to design loyalty programs,
and to understand those markets is necessary for global companies.
Therefore, it is necessary to probe out different antecedents of brand
loyalty and their significance. Growth in the beverage industry and
customer loyalty to the firm is imperative to be learned. Firms can be
possibly taking advantage of growth if their
managers are able to formulate
strategies to keep their customers and encourage them for repeat
purchases, thus makes them loyal (Porter, 2008; Nwokah, 2008).
Therefore, working on brand loyalty can be helpful for many firms. Due
to the importance of brand loyalty for the competitive advantage of
different companies, this study explicitly investigates the determinants
of brand loyalty in the context of beverage Firm in Port Harcourt.
1.3 Purpose of the Study
The main purpose of the study is to
examine Brand Equity and Marketing Performance of Beverage firms in Port
Harcourt. The specific objectives of the study are to:
1) To examine the relationship between Brand Awareness and marketing Performance of beverage firms in Port Harcourt.
2) To examine the relationship between Brand Loyalty and marketing Performance of beverage firms in Port Harcourt
3) To examine the relationship between Brand Associations and marketing Performance of beverage firms in Port Harcourt.
1.4 Research Question
The following research questions will guide the study.
1) How does Brand Awareness affect marketing Performance of beverage firms in Port Harcourt?
2) How does Brand Loyalty affect marketing Performance of beverage firms in Port Harcourt?
3) How does Brand Associations affect marketing Performance of beverage firms in Port Harcourt?
1.5 CONCEPTUAL FRAMEWORK OF BRAND EQUITY AND MARKETING PERFORMANCE
The following hypothesis will be used in guiding the analysis of our findings
Ho1. There is no significant relationship between Brand Awareness and Market Share.
Ho2. There is no significant relationship between Brand Awareness and Sales Growth.
Ho3. There is no significant relationship between Brand Loyalty and Market Share.
H04. There is no significant relationship between Brand Loyalty and Sales Growth.
H05. There is no significant relationship between Brand Associations and Market Share
H06. There is no significant relationship between Brand Associations and Sales Growth.
1.6 Significance of the Study
The studies will a source of secondary
data to other researchers who wish to conduct studies on related issues.
It will again act as mainstream for generating, keeping and maintaining
The research will also provide the
management of Beverages in Nigeria with a better understanding of the
CRM concept and assisted them to improve their own service quality.
The study will also serve as a useful
reference material for students, academicians, institutions, corporate
bodies and corporate managers who are interested in the subject of
Beverages in Nigeria.
1.7 Scope of the Study
The general scope of this study covers
Brand Equity and Marketing Performance of Beverage firms in Port
Harcourt. The geographical scope is Rivers State of Nigeria. The units
of analysis cover Beverages Industry in Rivers State.
1.9 Definition of Terms
Brand Equity: brand equity is defined as the incremental cash flows which accrue to branded products over unbranded products
Brand Loyalty:Aaker (1991) defines brand loyalty as ‘the attachment that a customer has to a brand’.
Brand Associations: Brand associations are mostly grouped into a product-related attribute like brand performance and non product
related attributes like brand personality and organizational associations.