THE ROLE OF MARKETING IN IMPROVING THE PROFITABILITY OF AN ORGANIZATION (A CASE STUDY OF CADBURY NIGERIA PLC, LAGOS.)

ABSTRACT

This project is centred on the role of marketing in improving the profitability of an organization with reference to Cadbury Nigeria Plc, Lagos.

This research work is necessary and imperative so as to determine the role of marketing in improving the profitability of an organisation.

The researcher distributed questionnaire to workers in company under study. Personal interviews were also conducted with some workers in the department. The data gathered was analyzed on different tasks by using percentages.

Based on the underlying assumption, the following were recommended for the study, marketing should start from customers by identifying their needs and ends with customers by satisfying their needs, the organizations sales force should be trained and informed about the role of marketing on profitability, and marketing strategies should be effectively used to reach the target market and improve profitability.

TABLE OF CONTENTS

Title Page

Certification                                                                            i

Dedication                                                                               ii

Acknowledgement                                                                             iii

Abstract                                                                                  iv

Table of Contents                                                                    v-vii

CHAPTER ONE

1.0     INTRODUCTION                                                                   1-2

1.1     Statement of the Problem                                                        2-3

1.2     Objectives of the Study                                        3-4

1.3     Significance of the Study                                                         4

1.4     Scope of the Study                                                                  5

1.5     Research Questions                                                       5

1.6     Research Hypothesis                                                     5-6

1.7     Limitations of the Study                                                          6-7

1.8     Historical Background of Cadbury Nigeria Plc.   7-10

1.9    Definition of Terms                                     10-12

CHAPTER TWO

2.0     LITERATURE REVIEW                                                        13-19

2.1     Evolution of Marketing           19-20

2.2     The Marketing Concept                                                 21-23

2.3.    Marketing – Mix Strategy                           23-24

2.4    Marketing Environment           24-26

2.5   Marketing Segmentation                                                 26-27

2.6   Marketing Strategy                                                27-28

2.7   Functions of Marketing                                                  29-31

2.8   The Contributions of Marketing                                               32

2.8.1Marketing and the Producer                                   32-33

2.8.2 Marketing and the Consumer/Individual                        33-34

2.8.3  Marketing and Society                                         34-35

2.9 Concept of Profitability                                                      35-36

2.10 Profitability Analysis                                                       37-39

2.11 Comparing Profit and Profitability                                   39

2.11.1The Difference between Profit and Profitability                      39-41

2.11.2Determinants of a Company’s Profitability                            41-43

2.11.2Mearuring Profitability                                                           44

2.12 The Role of Marketing on Company Profitability                44-46

2.13 The Effect of Market Orientation on Company Profitability 47-49

2.14 Marketing Budget Process                                                  49-51

2.15 The Measurement of Marketing Effectiveness                  51

2.15.1Purchase Decisions                                                          51-52

2.15.2Scrutiny from Finance                                                      52-53

2.15.3The Dichotomy of Interests between Marketing and Finance 53

2.15.4 Differing Perspectives                                                       53-54

2.16 The Pitfall of Market Share                                                  54

2.17 Reconciling Differences to Increase Company Profitability   54-55

CHAPTER THREE

3.0     RESEARCH METHODOLOGY                                   56

3.1     Research Design                                                            56

3.2     Sample Presentation                                            56-57

3.3     Sources of Data                                          57

3.3.1  Primary Source of Data                                       57

3.3.2  Secondary Source of Data                                             58

3.4     Statistical tools                                           58-59

CHAPTER FOUR

4.0     DATA ANALYSIS AND PRESENTATION                       60-69

4.1     Testing of Hypothesis Using Chi-Square                      70-72

4.2.    Analysis of Hypothesis                                                  72-78

CHAPTER FIVE

5.0     SUMMARY, CONCLUSION AND RECOMMENDATION  79

5.1     Summary of Findings                                                    79

5.2     Conclusion                                                                     79-80

5.3     Recommendation                                                           80-81 Bibliography

CHAPTER ONE

• INTRODUCTION

Marketing is an essential feature of economic life of any community, because it is simply a global term for the business of finding out what people want, making the potential buyer aware of the product’s existence, selling it to them and ensuring that it is supplied to them at the time and place and in the condition they expect.

Naturally, no business is prepared to do all these unless at the same time it makes a satisfactory profit for itself.

In essence, marketing means establishing a need and then satisfying it. The key point in this description of marketing is that everything is based on satisfying the customer’s need and satisfying the seller’s profit making.

Unlike in the past when there were scarcity of goods and when whatever goods produced would be brought, the present economic situation shows that unless a product or service is designed from the start to match fairly precisely what the market demand and it is then vigorously promoted and sold, the customer is not likely to buy it.

Quite a high number of failures in business enterprises have been attributed to poor marketing and the irresponsiveness of marketers to adoption of newer technologies – an example is type of marketing strategies used. It should be stated at this beginning that marketing department in any organization do not perform miraculous increase in organizations profitability, but employ strategies that are sure of selling the organizations product to maximize profit. These strategies are the 4ps of marketing, price, promotion, product and place.

The success of any business venture solely depends on marketing. The skills in organisation command in marketing.

Therefore, the role of marketing in improving the profitability of an organisation need not to be over emphasized. The aim of  the research work is to find out the role marketing plays in improving the profitability of an organisation.

In conclusion, marketing is all about providing the customer with what he or she wants at a profit.

• STATEMENT OF PROBLEM

In a business world today, a lot has been said and written about the role marketing plays in an organisation. There is an outcry against the way most companies execute their marketing programmes.

The marketing programmes of some companies are deficient and discouraging which can have adverse effect on their profitability.

Also, it has been observed that goods are produced in large quantities but they are not properly distributed. So, lack of strategies to adopt in distributing the product to the final users is another problem which will affect profitability.

Consumer as a king has unpredictable behaviour which companies a times find difficult to satisfy, this prompt many companies to spend more money on the marketing of their product which can have either positive or negative effect on their profit.

Marketing environment is an obstacles to the profitability of an organisation, the marketing organisation also depend on its environment to ensure its survival, growth and success. All these will be examined with a view to providing amicable solutions.

• OBJECTIVES OF THE STUDY

The research work is primarily carried out to achieve the following objectives:

1. To examine the extent which marketing will improve the profitability of an organisation.
2. To determine if marketing service have any impact or role to play in the profitability of a company.

• To draw the attention of the body concerned to take necessary action for more development in improving the organizational profit.

1. To evaluate the role of marketing in the attainment of organizational goals to know if objectives for using marketing as pivotal is realized and determined the effectiveness and shortfall in marketing service delivered to customer.
2. To study out the existing marketing strategies to employ in improving organizational profitability.
3. To aim at continual growth of business firm by prospecting for.
   • SIGNIFICANCE OF STUDY

The relevance of this study is to examine the role play by marketing in improving the profitability of an organisation.

The study will be useful in contributing to the body of existing knowledge as well as, future research of similar studies. This write up will contribute in some extent to the effective building up of knowledge in practice and utilization of marketing.

• SCOPE OF THE STUDY

The focus of this study is on the examination of the role marketing plays in improving the profitability of an organisation. It considers the argument whether there is a need for marketing in improving organisation’s profitability.

Finally, we are concerned in this study with the positive impact of marketing towards maximizing organizational profit.

• RESEARCH QUESTIONS

1. What roles does marketing activities play in improving the profitability of an organisation?
2. Is there any relationship between marketing activities and profitability of an organisation?
3. What are the effects of marketing activities on the profit of an organisation?
   • RESEARCH HYPOTHESIS

H₀:     There is significant relationship between marketing activities and profitability.

H₁:     There is no significant relationship between marketing activities and profitability.

H₀:     Marketing has a positive impact on profitability.

H₁:     Marketing has a negative impact on profitability.

H₀:     Improving profitability of an organisation is independent on marketing.

H₁:     Improving profitability of an organisation is dependent on marketing.

H₀:     There is significant distinction between marketing and selling.

H₁:     There is no significant distinction between marketing and selling.

H₀:     Represent Null Hypothesis.

H₁:     Represent Alternative Hypothesis.

• LIMITATIONS OF STUDY

This study is subject to all the usual limitation, which affect research in West Africa but with particular reference to Nigeria.

Secrecy, which makes it difficult to obtain vital information from Nigeria business executives.

The claim to be mindful of the fact that such information might get to competitors, and the existence of espionage also gives them cause to worry.

The limited time factor allowed to carry out the research work made the researcher to concentrate more on finding of extent of the role marketing plays in improving organizational profitability of Cadbury Nigeria Plc.

Lack of cooperation and reluctance to grant the researcher interview or respond to the questionnaire administered on the ground of not wanting to commit their firm was also a limiting factor. The librarians were not cooperative. The library catalogue has not been updated and a lot of reference materials have been made away with, by some selfish students.

But still, with these limitations not with standing, the research was successfully conducted.

• HISTORICAL BACKGROUND OF CADBURY NIGERIA PLC

Cadbury Nigeria Plc started as an offshoot of Cadbury Export Limited, a British Company primarily engaged in the purchase of Cocoa firm, the West Coast of Africa for Cadbury Limited in the United Kingdom.

The operation of Cadbury Nigeria Limited in Nigeria dated back to the immediate First World War. When it s products were imported and introduced into the Nigeria market. This market was serviced by the export representation of the parent company that resided in Ghana and made regular visit to Nigeria in 1956, a Cadbury Salesman was based in Nigeria and polling increasing sales volume, a distribution deport was built in Apapa in 1959. The depot supplied products to the big companies in other retail outlets. In this way Cadbury appointed many new distributors and the product penetrated more deeply into Nigeria market.

The organisation, begin its operation in the year 1965 with the manufacture and sales of Pronto Food Drink. The objectives for which the new company was established were the processing of locus beans, the manufacturing of chocolates, confectionaries, beverages and other processing of local foods.

Cadbury Nigeria Limited, became a public liability company in the year 1991, it was quoted on the stock exchange in 1978.

The organisation moved from Apapa plant to its present location at Agidignbi in 1969 and has since continued to grow – skill and technology were transferred from the company defined, its business as begin in the total and confectionery industry.

The organisation ownership structures are Cadbury Schweppes owned 46.6% while Cadbury Nigeria own 54.5%. The current Managing Director and Chief Executive Officer of the organisation is Mr. Bunmi Oni.

A lot of research works were embarked upon with the objective of introducing new products which had been specially designed for the Nigeria market. Bournvita continued to performed strongly and was re-launched with a new packaging design in October 1990. New advertising on television contributed substantially to the performance of the company sugar confectionery brands like butter mint, malta sweet, tom-tom etc. with sales volume of 16% ahead of the previous year i.e. 1991.

The know seasoning cub had a good account for itself in the market place with an increase of 40% over what was sold in 1991.

Another major event during the year 1990 was the addition of the Trebor brands of sweets to the Cadbury Confectioner range. This came about as a result of the acquisition of the trebor business in the United Kingdom by Cadbury Schweppes Plc. As the new move of trebor, Cadbury Schweppes offered Cadbury Nigeria Plc its organisation of being licenced as the producer and marketer of trebor in Nigeria.

Besides the success of Cadbury Nigeria Plc products, there are some that are no longer in existence such as Bazooka-Joe and Bon-bon. The Bazooka-Joe has been recycled to a new brand product called the Bubba Bubble Gum, which was launched in the year 2003.

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