THE IMPACT OF MARKET SEGMENTATION ON THE SALES PERFORMANCE OF AN ORGANIZATION
(A Case Study of Indomie Instant Noodle Sharada, Kano)
ABSTRACT
This research work is entitled “Impact Of Market Segmentation on Sales Performance” (A Case Study of Indomie Instant Noodle Sharada Kano). The aim is to identify the benefit of market segmentation on product positioning and also to identify the problem of market segmentation on service industry. Data for the study was collected from primary sources and was used to test the hypothesis. The empirical result reveals that the Indomie Instant Noodle Sharada Kano has been effective in the market segmentation. From the study so far, it is clear that market segmentation is necessary for any business to remain ongoing and for the growth of the company.
CHAPTER ONE: INTRODUCTION
- BACKGROUND TO THE STUDY
In every society, consumers are the most important thing to consider while operating as any business. The satisfaction of these consumers now becomes the firm’s ultimate goal. In order to achieve this market it takes a lot of marketing strategies.
One of such strategies is market segmentation, which is a customer-oriented philosophy since no firm can produce and satisfy the whole market. Therefore, for any firm to produce and market its products and market its product effectively, it has to identify a sub-market within the aggregate market, select and reach with distinct marketing mix.
Today studies have revealed that a marketer‘s success depends on adequate knowledge of his market product and more specifically on his skills in effecting ownership transfers.
Sales performance uses raw data concerning the number of customers a sales associate speaks to compared with the number of actual sales. It indicates the rate of customer loyalty to the business or a specific employee. Enhancing sales performance can automatically enhance the number of loyal customers.
Sales performance can also indicate whether a department is overstaffed. By comparing the sales numbers based on the monetary amount spent on staffing, managers can determine ideal staffing levels.
1.1 STATEMENT OF THE PROBLEMS
An understanding of the meaning of market segmentation on sales performance and it impacts in serving the different market segments is one of the inherent problems in the most organization today. Identifying sub-markets either as a competitive strategy or as a measure to burden the market and promote a product to meet the needs of different customer group is a difficult task.
The marketer is faced with controllable variables like product, price, promotion, and distribution as well as uncontrollable variables like competition, economy, consumer demand, technology, a socio-cultural environment which summed involves huge financial burden.Wendle Smith (1990-1997)
Indomie Instant Noodles Sharada Kano.is an organization where the concept of market segmentation can successfully be applied. What management does is to identify and determine the segments existing in a market, to understand the make-up of segments and their needs.
The strength of all these becomes imperative for marketing managers to focus more of their attention on how best to develop strategies for its products, most of these problems on segmentation includes;
1. The need to know whether segmentation is a good marketing strategy for sales performance.
2. Whether it allows firms to develop specific products that really match the market demand.
3. Whether it allows for the development of specific promotional message for each segment of the market.
1 .2 OBJECTIVES OF THE STUDY
The specific objectives of the research work are:
- To examine the relationship between market segmentation and product development.
- To examine the relationship between market segmentation and sales volume.
- To ascertain the effect of market segmentation on organization’s profitability.
1.3 RESEARCH QUESTIONS
The following research questions are designed to guide the study;
- What is the nature of the relationship between market segmentation and product development?
- What is the nature of the relationship between market segmentation and sales volume?
- What is the effect of market segmentation on organization profitability?
1.4 STATEMENT OF THE HYPOTHESIS
The following hypothesis is formulated for this study:
Ho 1: Market segmentation has no significant relationship with product development
Hi 1: Market segmentation has significant relationship with product development
Ho 2: Market segmentation has no positive relationship with sales performance
Hi 2: Market segmentation has positive relationship with sales performance
Ho3: Market segmentation has no significant impact on organization profitability
Ho 3: Market segmentation has no significant impact on organization profitability
1.5 SIGNIFICANCE OF THE STUDY
The study will be of great benefit to consumers and individuals in their purchasing pattern. It will serve as a base for further study in the same field or related field by students in tertiary institutions.
It will serve as a frontier of knowledge. It would be used to evaluate good or bad principles.
1.6 SCOPE OF THE STUDY
This study covers the impact of market segmentation on sales performance which is carried out onIndomie Instant Noodles Sharada Kano.
1.7 LIMITATION OF THE STUDY
There are many constraints and factors that were encountered by the research during the research work. The prominent once are:
- Financial Constraints: The cost of materials necessary to aid in carrying the research are very expensive, a lot of field work ought to have been done, but for inadequate finance, a limited coverage of the company understudy was embark upon.
- Time Constraints: Lack of time contributed greatly affected the quality of work, the academic session very short and the time given to submit the project work also short. Most of the information needed by the researcher in that information needed by the researcher in that company was not accessible for the sole reason of short notice. The study is limited to Abuja bottling company or plant because of time constraint.
- Biased Response: Biased response by the respondent was a problem encountered by the research when collecting data.
1.8 OPERATIONAL DEFINITION OF TERMS
Market segmentation is the activity of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as segments) based on some type of shared characteristics. Philip Kotler (1997).
MARKETING: According to Philip Kotler (1997) “Marketing can be defined as consumer satisfaction”, that is all marketing activities should be directed towards consumers satisfaction.
Mass marketing: It is trying to sell a product to everyone in a market. Don Debelak (1997)
Product: Can be defined as any commodity that has a monetary or commercial value. Philip Kotler (1997).
Sales: Are activities related to selling or the number of goods or services sold in a given time period. David Jobber (2012).