AN ASSESSMENT OF PRICING STRATEGIES FOR NEW PRODUCT IN A COMPETITIVE MARKET IN ABUJA FCT
(A case study of Airtel Abuja)
ABSTRACT
This research work was based on an assessment of pricing strategies for new product in a competitive market in Abuja FCT” (a case study of AirtelAbuja),was picked to serve as a sample for the population in the course of the research.Scope and limitation and the terms were designed. In chapter two, marketing strategies designed levels of planning the marketing strategies were explained. The marketing mix, marketing environment, have been examined with the summary of literature review. Chapter three shows research designs and methodology, source of data questionnaire design, the population and sample and the questionnaire that are distributed and collected. Chapter four contains data presentation and analysis as well as a reasonable conclusion after which source and useful recommendations were suggested. The researcher used questionnaire method to obtain information, organize the research work in five (5) chapters. The Chi-square method was used to analyze the necessary data obtained from the questionnaire returned. Adequate suggestions and recommendations were made.
CHAPTER ONE: INTRODUCTION
- BACKGROUND OF THE STUDY
Pricing is one of the most important tools among the 4ps of marketing. It is one of the elements that generate revenue. Therefore, it has to be handled with care since all other piece depends on the sales revenue. Authors in various field of study defines pricing as the amount for which a product, service or ideas is offered for sale regardless of its worth or value to potential buyers. Pricing has been traditionally considered a “me too” available in developing marketing strategies (price is often on e of the most visible element of the firms marketing mix). Potential buyers of some products promotional message product quality or other product features. One of the marketing management’s mean responsibilities is to establishing a price level for brands or product lines with the context of a dynamic pricing strategy (price are based on cost and companies must do all the traditional way of setting the prices).
The prices of any goods of any goods or services are based on the law of demand which states that price reducing generates demand increase and price management demand increase, and price generates demands. Reduction however, it should be noted that not all products display this traditional relationship in some product they reverse it.
1.1 STATEMENT OF THE PROBLEMS
Introducing a new product into a market by any organization in the counterpart and other organization have its own problem in the business circle. Some of these problems are as follows:
POLICY: When pricing a product or services, the firms must observe the general minimum price laws to its types of business. The law sometimes limits an organization opportunity in utilizing its own price strategies.
INFLATION: Inflation is another factor in determining the pricing company’s strategies. The price of goods and services are no longer stable because of inflation; because of this, prediction of future market position becomes difficult.
LAW OF DEMAND AND SUPPLY: The law of demand and supply constitutes a problem to a company in setting its pricing strategies. Hence it states that the higher the price of a product or services the lower the quantity will be bought of that product vice-versa. In these circumstances the law of demand forces the company to set a price that consumers can afford due to the fear that consumer will turn their buying effort to their competitors. Hence, penetrating pricing strategies is the only alternative to be practiced in the market. Economic instability also serves as a problem in setting a price for a commodity. Strategies used to be unstable because of this instability in our economic conditions.
1.2 OBJECTIVES OF THE STUDY
The general objective of this work is to make a detailed analysis and appraisal of the pricing strategies for new products in a competitive market using Airtel Nigeria as the area of study. The objectives of the study include but not limited to;
1. To determine the effect of price development strategy on the performance of an organization.
2. To determine the extent to which product development and improvement of existing products affects performance of an organization.
1.3 RESEARCH QUESTIONS
1. Does price development strategy have effect on the performance of an organization?
2. To what extent does price development and improving existing product affect performance of an organization?
3. Does your competition hinder price development?
1.4 STATEMENT OF THE HYPOTHESIS
H0: Price development strategy has no effect on the performance of an organization.
H1: Price development strategy has effect on the performance of an organization.
1.5 SIGNIFICANCE OF THE STUDY
The project work is necessary in order to know the significance in the pricing strategies for a new product in a completion. It is to focus on the activation of Airtel in the regulative of an effective communication in an organization, firms and ministries etc the Nigerian Airtel and all other business organizations would derive great benefits from this research work. It will assist existing communication organizations to solve or put an end to the problems caused by poor communication or poor network at their disposal. Furthermore, the government and the public sector will find this project very useful in maintaining a perfect pattern of communication design to maintain the day to day running of the sector.
1.6 SCOPE OF THE STUDY
The study is limited to an assessment of pricing strategies for new product in a competitive market in Abuja FCT.
1.7 LIMITATIONS OF THE STUDY
In the course of carrying out this essay, certain factors militated against the
smooth operation of the work. The exercise was greatly limited due to some of these factors include:
– Lack of funds
– Time constraints
– Inadequate research materials to collect data such as textbooks, journals, magazines
1.8 OPERATIONAL DEFINITION OF TERMS
PRICE:Is the value of product expressed in terms of naira and kobo.
PRICING: The act of translating into quantitative terms (naira and kobo) the value of a product to customer at a point in time
SKIMMING STRATEGY: Is a kind of marketing strategy where the producer has a higher price and a higher promotion.
PENETRATION STRATEGY: Is where the producer fixed a low price and a higher promotion. PRODUCT: a is define as something that is capable of satisfying a customer’s need or wants. It may be tangible or intangible.
PRODUCT MIX: This is the composition of products offered for sale by a given firm or business unit.
PRODUCT LINE: This is a group of products that are closely related either because they satisfy a class in need, they are used together and they are sold to the customers group, marketed through the same market outlet or falls within the same price range.
PRODUCT MANAGEMENT:The manipulation of products to satisfy a given target customers is known as project management.