EXAMINATION OF FACTORS THAT MILITATE AGAINST INTRODUCTION OF A NEW PRODUCT IN THE MARKET. (A STUDY OF STARLITE BY NIGERIAN BREWERIES PLC)

ABSTRACT

This research project examines the factors that militate against introduction of a new product in the market on Enugu metropolises and possible solutions. Taking cognizance on the ever changing or dynamic market environment, the need for proactive marketing in forms and of innovative actions becomes paramount in order for these firms to survive and grow. The main objectives among other things were; To find out factors militating against the introduction of starlite into the beer market, to determine whether product quality, high price, poor timing and ineffective organizational arrangement were among factors that adversely affected the introduction of star lite. An in-depth literature review was carried out on related materials such as textbooks, journals; magazine and newspapers. Data were also sourced from respondents. Topman's formula has used to determine the sample size for consumers. Also Burley's formula was used for distributors while census survey was used for management/relevant staff. The research instruments used in sourcing data were questionnaire and oral interview. These data were also used in testing the three hypotheses formulated. The researcher discovered that a substantial part of the total market was satisfied with the taste and little sugar content of the product. The researcher also found out that poor timing and ineffective organizational arrangement militated against the initial successful introduction of starlite.

TABLE OF CONTENTS

Title page    -         -         -         -         -         -         -         -          -         -         i

Dedication  -         -         -         -         -         -         -         -          -         -         ii

Acknowledgment -         -         -         -         -         -         -          -         -         iii

Table of contents -          -         -         -         -         -         -          -         -         iv

List of tables -       -         -         -         -         -         -         -          -         -         vi

Abstract -   -         -         -         -         -         -         -         -          -         -         viii

CHAPTER ONE

INTRODUCTION

1.1     Background of the Study -         -         -         -         -          -         -         1

1.2     Statement of the Problem           -         -         -         -          -         -         3

1.3     Objective of the Study    -         -         -         -         -          -         -         3

1.4     Research Question           -         -         -         -         -          -         -         4

1.5     Statement of Hypothesis -         -         -         -         -          -         -         4

1.6     Significance of the Study -         -         -         -         -          -         -         5

1. 7    Scope of the Study          -         -         -         -         -          -         -         5

1.8     Limitations of the study - -         -         -         -         -          -         -         5

1.9     Definition of Terms -       -         -         -         -         -          -         -         6

CHAPTER TWO

REVIEW OF RELAT-ED LITERATURE

2.1     Introduction -        -         -         -         -         -         -          -         -         8

2.1.1  What Governors New Product Success -        -         -          -         -         9

2.1.2 Ways Companies Organize For New Product Development -       -         11

2.1.3 The New Product Development Process. -     -         -          -         -         12

2.2     Factors Militating Against the Successful Introduction of A New

Product In the Market. -   -         -         -         -         -          -         -         17

2.3     New Product Introduction and the Beer Industry -  -          -         -         19

2.4     Brief History of Nigerian Breweries -  -         -         -          -         -         21

2.5     Brief History of Star Lite. -       -         -         -         -          -         -         22

2.6     Brand Extension - -         -         -         -         -         -          -         -         23

CHAPTER THREE  

RESEARCH METHODOLOGY

3.1     Research Design - -         -         -         -         -         -          -         -         27

3.2     Sources of Data -   -         -         -         -         -         -          -         -         27

3.3     Population of the Study - -         -         -         -         -          -         -         27

3.4     Sampling Techniques -    -         -         -         -         -          -         -         29

3.5     Selection and Construction of Research Instrument -          -         -         31

3.6     Administration of Research Instrument (Questionnaire) -          -         -         31

3.7     Method Of Data Analysis. -       -         -         -         -          -         -         31

CHAPTER FOUR

4.0     DATA PRESENTATION AND ANALYSIS

4.2     For Staff -   -         -         -         -         -         -         -          -         -         38

4.3     Questionnaire Analysis for Distributors  -      -         -          -         -         45

4.4     Testing Hypothesis          -         -         -         -         -          -         -         47

CHAPTER FIVE

SUMMARY OF FINDING RECOMMENDATIONS AND CONCLUSION

5.1     Summary of Findings -    -         -         -         -         -          -         -         50

5.2     Recommendation  -                    -         -         -         -          -         -         50

5.3     Conclusion -          -         -         -         -         -         -          -         -         51

BIBLIOGRAPHY  -      -         -         -         -         -         -          -         -         52

LIST OF TABLES

Table 4.1.1

Table 4.12              Response on Whether Responded Are Aware of Starlite

Table 4.1.3             Respondent Rate on How Respondents Came to Know About Starlite

Table4.1.4              Response Rate on Whether Respondents Like The Product

Table 4:1:5             Response Rate on Why Respondents Like the Product.

Table 4:1:6             Response Rate on Why Respondents Dislike the Product.

Table 4.1.7             Response Rate on Whether Respondent Were Satisfied With the Quality of the Product.

Table 4.1.8             Response Rate Whether the Quality of the Product Affected

Respondents Patronage during The First Time of Consumption.

Table 4.1.9             Response Rate on Respondents View When Comparing Starlite with Other Competing Brands.

Table 4.1.1

Table 4.12              Response on Whether Responded Are Aware of Starlite .

Table 4.1.3             Respondent Rate on How Respondents Came To Know About

Starlite.

Table4.1.4              Response Rate on Whether Respondents Like The Product.

Table 4.1.5             Response Rate on Why Respondents Like the Product.

Table 4:1:6            Response Rate on Why Respondents Dislike the Product.

Table 4.1.7             Response Rate on Whether Respondent Were Satisfied With the Quality of the Product.

Table 4.1.8             Response Rate Whether the Quality of the Product Affected

Respondents Patronage during The First Time Of Consumption.

Table 4.1.9             Response Rate on Respondents View When Comparing Starlite with Other Competing Brands.

Table 4.2.0             Response Rate for Staff on Whether Staff Has Been Employed When Starlite As Introduced .

Table 4.2.1             Response Rate to Know The Performance Of Starlite.
Table 4.2.2             Response Rate on Positive Factors That Affected Starlite

Performance.

Table 4.2.3             Responds Rate on Negative Factors That Affected Starlite

Performance in the Market

Table 4.2.4             Responds Rate to Know the Respondent Assessment of Price On Starlite When Compared To Other Brands

Table 4.2.5             Respondent Rate to Know Whether Price Of Starlite Commensurate With The Quality.

Table 4.2.6             Response Rate to Know Whether Timing Adversely Affects Starlite Performance When It Was Newly Introduced Into The Beer Market.

Table 4.2.7             Response Rate to Know To What Extent Timing Adversely Affected Starlite When Newly Introduced
Into the Beer Market.

Table 4.2.8             Response Rate On Whether Organization Arrangement of the Company Affected The Introduction Of Starlite As A New Product.

Table 4.2.9             Response Rated To Know What Has Organizational Arrange of the Company Affected the Introduction Of Starlite As A New Product.

Table 4.2.10:          Response Rate on Whether Organizational Arrangement of the Company Affected the Product During Introduction

Table 4.1.11           Response Rate To Know When Product Quality Affects the Introduction Of Starlite As A New Product

Table 4.3.1             Responds To Know How Many Years Respondent have been Distributed For Nigeria Breweries Plc.

Table 4.2.2             Response to Know Whether Respondents Deal On Starlite.

Table 4.3.3             Response Rate to Determine Respondents View On the Performance of The Product When Newly Introduced In The Market.

CHAPTER ONE

INTRODUCTION

1.1          Background of the Study

The quest of a satisfying solution to human needs and wants is old as human existence on the face of this planet called earth. Clouded around us are pools of human wants and needs ranging from physiological need such as food, clothing and shelter to social needs.

The search for solutions was initially based on self-effort due to the primitive state of man. But as our society advanced more sophisticated means of solving or satisfying these need were discovered. This has led to the creation/development of need satisfying product by business entities or companies whose existence and survival hang solely on the performance of these products whether tangible or intangible.

Products like human life pass through phases or spans of life which Philip Kotter (1997) called product life cycles. Introduction, growth, maturity and decline. In view of the fact that every product passes through these stages more importantly the maturity and" decline the need for a continuous development or innovation of new product becomes dispensable for the continual growth, survival and profitability of the company and organization.

New product development has become crucial aspect of firms marketing management. These companies develop new products for the following reasons:

·      To replace those products that have become outdated in the eyes of the consumers/customers to satisfy the changing needs for the consumers and more still to contain competition without resorting to price competition.

·      Reason enumerated by authorities for developing new product includes the need to sustain a high level of sales for the company. This could arise from the cyclical nature of consumer patronage of each product and threat of obsolescence that hangs over most products and consumer increase sensitive and selection in their choice of products. Besides most companies particularly large ones are eager to introduce new products into the market for image making purpose. On the other hand, most companies may find that' considerable resources which needs to be put to fruitful and profitable uses are lying idle, thus the only rational behavior, open to the company is to develop new products.

·      Suffice it to say that many companies are increasingly beginning to appreciate the important if the new product development because of its implication on the contained survival, growth, profitability and the existence of competition. Despite this, lots of new products introduced and lunched into the market could not sustain and satisfy consumer's appetite.

·      Estimate as to the proportion of new products which succeed range is from 2 to 20 percent. Various reasons have been adduced as to why product failed in the market, the following reason were adduced although an idea may be good, the market size may have to overestimated perhaps the actual product was not designed as well as it should be. It may be a "me too" product which is not better than products that are already established in the market' place. Or maybe neatly positioned in the market, price too high or advertised and despite poor marketing research findings. Sometimes the costs of product development are higher than budgeted and sometimes competitors fight back harder than expected. In other to provide empirical endure to justify or approve the above reasons, this study will critically investigate the factors.

1.2      Statement of the Problem

The market for beer industry is increasingly becoming very competitive. This is marked by the presence of many firms/companies both multi-national and national that has made a road in the market. This has initiated keen competition among the various food beverage companies. It is obvious that for any company to sustain 'its customer's appetite, survive, grow and increase its market share and profitability the need to innovated/develop new products that could satisfy this tide becomes paramount.

Nigerian Breweries Company" one of the companies in the food/beverage industry occupies a dominant position in the market with its varieties of beer brands. In order to sustain its market shares the company recently introduced a new product known as "STAR LITE" to its brand of products. Since the introduction of the product is believed to have enjoyed some, degree of customer acceptance and preference. However, the performance still leaves much to desired, as the sales 'turnover of the product (Starlite) rather than been on the upward trend has been on the downward trend.

Consequent upon this, the need to investigate some of the factors that militate against successful introduction of new products becomes inevitable. This critically evaluated the factors militating against the successful introduction of new products in the market with particular focus in Starlite by Nigerian breweries plc.

1.3          Objective of the Study

The main objective of this study among other things includes.

I.               To determine the factors that militates against the introduction of Starlite beer industry.

II.            To determine whether the product concept about Starlite reflects the true nature of the product and need of the market.

III.          To determine whether the assessment of the market potential and timing of the product lunch Starlite was adequately carried out.

IV.          To determine whether Starlite -product brand was test marketed before it was commercialized.

V.            To determine whether the test marketing of Starlite gained consumer acceptance.

1.4      Research Question

I.               To what extent did these factors militate against the introduction of starlite beer industry?

II.            To what extent did the product concept about starlite reflect the true nature of the product and the need of the market?

III.          What determines the extent of the market potential and timing of the product lunch?

IV.          Was the starlite product brand tested before it was commercialized?

V.            Did the text marketing of star lite gained consumer acceptance?

1.5      Statement of Hypothesis

HO₁: product quality has not adversely affected the introduction. of startlite as a new product

HO₂: poor timing did not adversely affect the introduction of starlite as new product into the beverage drinks market.

HO3: ineffective organizational arrangement did not adversely 'affect the introduction of starlite as new product.

1.6      Significance of the Study

This study is not a mere academic exercise. It will be of great benefit of the following:

Firstly, the Nigeria breweries Plc will benefit immensely from this study because it will

Secondly, the study will be of great benefits to industries and the Nigerian economy. This stems from the fact that new product development has been discovered to be the key factors that guarantees industrial and economic growth as Druccer (1997) apparently recognized it when he said "A business enterprise has only two basic functions, marketing and innovation.

Thirdly, the study will be of immense benefit to customers of Starlite drink as adequate measures that will be recommended, which will go a long way to boost the satisfaction and value delivery ability of Nigerian breweries plc.

Above all, the study will not only be of benefit to the researcher but also the reader, as adequate knowledge and understanding will be gained from the information contained in the study of Starlite.

1.7      Scope of the Study

This study will only investigate the factors militating against Starlite beer by Nigerian breweries company pic. The study is, limited /\0 mile corner Enugu metropolis .

1.8 Limitations of the study

It is important to know that there were limitations imposed by the containing variables which include:

a.        Finance

b.       Time

A.   Finance: Finance was a major constraint that hampered the study. This was due to the fact that the research has no source of financial support, besides his parents and relative. To this end the research had difficulty in coping with the financial demands of the study.

B.   Time: this is another very big or major constraining variable that limited the study. This was due to the fact the study was carried out as the peak of lectures and other academic activities.

Consequently, the researcher had difficulties in meeting an appointment with respondents.

1.9 Definition of Terms

The following terms used in the study should be taken to mean the following:

a.     Product: Product according to Umeh and Ude Umanta (2004) is anything that can be offered to a market for acquisition. It includes any physical object (e.g cars) service  (Lecturing, entertainment) personalities, places, organization and ideals.

b.     Innovation: According to Norbert M. innovation involves creative response to an modification of existing one to serve a need better.

c.     Industry: Industry according to oxford dictionary (1996:.451) is the whole firms dealing in the same kind of product.

d.    Marketing potential: according to Philip Kotter (1993) market potential is the total number of potential customers that can be served within the industry.

e.     Product life cycle: According to Umeh and Ude Umanta (2002) product life cycle concept conforms to sales history of successful new product (3). After the period of introduction the product experiences rapid growth in sales during the growth stage.

f.      Utility: Utility by definition is the amount of satisfaction that is been derived from a product or services at a particular time. Also according to Umeh and Umanta utility is the consumer's estimate of products over all capacity to satisfy his needs.

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