ABSTRACT
The topic titled
“Significance of price in introduction of a new product” was chosen to examine
the relevance of price in the introduction of a new product. The main objective
of this study is to investigate the significance of price on a new product. In
the course of this research the research
methodology adopted were the primary method of data collection through the use
of questionnaire and secondary method. Relevant
literatures were reviewed and data collected were analyzed using simple
percentage. This was equally used in
hypothesis testing. The study revealed among others that no business can meet
its set goals and objectives without pricing. It is therefore recommended that
there should be the establishment of a pricing section in the marketing
department to set prices and assist the
marketing department in determining appropriate prices for products. Certainly,
it is the belief\ of the research that, if these recommendation are complied
with, they would go a long way in not only helping the
business but the nation at large.
TABLE OF CONTENTS
Title
page i
Certification ii
Dedication
iii
Acknowledgement iv
Table
of content v
Abstract vi
CHAPTER ONE – INTRODUCTION
1.1 Background
to the study 1
1.2 Statement
of the Research Problem 2
1.3 Objective
of the study 3
1.4 Research
questions 4
1.5 Statement
of the Hypothesis 4
1.6 Scope
of the study 5
1.7 Significance
of the study 5
1.8 Limitation
of the study 6
1.9 Operational
Definition of Terms 7
CHAPTER TWO – LITERATURE REVIEW
2.1 Introduction 8
2.2 The Review 8
2.2.1 Nature and Objective of Pricing 8
2.2.2 Pricing Objective 9
2.2.3 Selection of pricing policy 10
2.2.4 Price Setting in practice 14
2.2.5 Appraising
the uniqueness of price among
other
marketing mix variables 18
2.2.6 Factors bearing on pricing 19
2.2.7 The
use of price strategy in enhancing the
growth
of a new product 23
2.2.8 Factors Influence Price Determination 24
2.3 Summary of the Review
CHAPTER THREE – RESEARCH METHOD
3.1 Introduction 33
3.2 Research Design 33
3.3 Population of the study 34
3.4 Sample/Sampling Techniques 34
3.5 Instrumentation 34
3.6 Method of the Data Collection 35
3.7 Method of Data Analyses 35
CHAPTER FOUR – DATA PRESENTATION, ANALYSES,
DISCUSSION OF FINDINGS
4.1 Introduction 37
4.2 Data Presentation and Interpretation 37
4.3 Data Analyses and Hypotheses Testing 47
4.4 Discussion of Findings 55
CHAPTER FIVE – SUMMARY OF FINDINGS,
CONCLUSION, RECOMMENDATIONS AND SUGGESTIONS FOR FURTHER STUDIES
5.1 Introduction 57
5.2 Summary of findings 57
5.3 Conclusions 57
5.4 Recommendations 58
5.5 Suggestions for further studies 59
References 60
Appendices 62
CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Price has been a major problem in producing a product. Every
company, that produces a product has one thing in mind which is the price. It is not easy for a company to fix a
price for their products because the company or manufacturer will want to
determine all the cost used in producing the product and in doing this, the
company or manufacturer will want to determine all the cost used in producing
the product and in doing this, the company or manufacturer will also want to
put the consumers in mind because if the price is too high, it will affect the
sales of the product and if it is too low, it will also affect the company or
manufacturer’s cost of production. All this point, the manufacturer or producer
will want to put at equilibrium.
On this note, the researcher decided
to carry out t his research work to find out what role price plays in the
market, the importance of price and possible solution on how price can be fixed
in a product. Pricing is considered by many people to be the key activities
within the capitalist system of free enterprise especially when introducing a
new product into the market.
Furthermore pricing and price
competition are problems facing marketing executives today. Price is too cost
oriented, price is not lavished often enough to capitalize on mark changes (Aluyor, 2010).
1.2 STATEMENT OF RESEARCH PROBLEM
Many criticism have been made against
certain pricing policies and some have questioned how certain pricing objectives
can really fit in with overall corporation.
The problem is to investigate why
certain pricing policies fail to assist in realizing company marketing
objectives hence the problem has under the following pertinent questions.
i.
What is the pricing method in manufacturing
enterprise
ii.
Should a company set prices independently of
other marketing mix variables?
iii.
That
what extent should a company take in to consideration of the demand intensity
for the product as well as the customer’s psychology w hen it assures a cost
oriented pricing strategy?
iv.
Should prices be tagged on a new product
without proper consideration of its supply?
v.
Should the production of a new product commence
and price attached without proper investigation about consumer’s interest?
1.3 OBJECTIVE OF THE STUDY
In carrying out a research, a lot of
things ought to be considered in respect to these products. One has to
critically look at the recent political state of the country. The country is
passing through a new political dispensation, which is headed by a civilian
president; these might facilitate the opening of neighbouring boarders hence increasing
the rate of imported goods into the country. These will help in a drastic
reduction of the process of product in circulation in the country, hence
increasing the rate of demand.
The aim of this research work is to
evaluate the significance of price fixed for a new product hence avid the
demand for the product.
The
study is aimed at realizing the following objectives;
i.
To check the reaction of consumers in the event of price increase
over a product
ii.
To identify the problems of new products
pricing decisions and make useful suggestions to help avoid the practical
problem of establishing a price.
iii.
To find out if the relatively low price of a product
could affects its purchases decision of the consumers of the product.
iv.
Finally, the study will also investigate the
place of price among other marketing mix
varieties.
1.4 RESEARCH QUESTIONS
The
following Research Questions shall
direct the thrust of this study.
1. Is the
increased patronage of Nigerian Bottling Company’s product influenced by its
promotional activities?
2. Is
advertising the most effective tool
for reaching customers?
3. Is the
patronage of Nigerian Bottling Company’s products influenced by the locations
of its depots?
4. Does
price influence the sales volume of a product?
5. Is
pricing decision cumbersome?
6. Is new product pricing usually a difficult exercise involving many problems?
7. Does
pricing decision has any impact on product success?
8. Is new
product pricing responsible for product failure?
1.5 STATEMENTS OF THE HYPOTHESES
1. Ho:
Prices does not influence sales volume
Hi: Prices does influence sales volume
2. Ho:
Pricing decision is not cumbersome
Hi:
pricing decision is cumbersome
Ho:
New product pricing is not usually a difficult
Hi:
New product pricing is usually a difficult exercise involving many problems
3. Ho:
pricing decision does not impact on product success.
Hi:
pricing decision has impact on product success
Ho:
New product pricing is not often responsible for product failure
Hi:
New product pricing is often responsible for product failure
1.6 SCOPE OF THE STUDY
This is limited to pricing as
marketing mix variable with respect to the growth of a new product very Amstel
Malta a product of Nigeria Breweries as
a case study. His is done with a need to identify the problem associated with
the pricing of a new product and so make useful suggestions.
1.7 SIGNIFICANCE OF THE STUDY
The
research work will be of immense importance to many parties when successfully
completed. Amongst t hose to benefit one the producers with regards to the best
price fixed on a new product tin order
to succeed the markets place. Also to benefit from the best price fixed on a new product will be investigated and
found out through feedbacks received from interviewers and questionnaires with
customers and staffs of Nigeria Breweries.
Consumers will also benefit from the
research work because their suggestions and criticism will be take into
consideration.
Above all, the researcher will also
benefit immensely because it is on the basic of successful completion of the
project work that the researcher will be awarded the Higher National
Diploma (HND) in marketing .
1.8 LIMITATION OF THE STUDY
During
the course of this research work several limitations which served as hindrance constraints to the successful
completion of the work were encountered. Efforts were however made by the group to minimize these
limitations
The first limitation was that of
finance , the work was carried out with the finance the group could pool. A more thorough research could have
been carried out if the much anticipated
finance was available.
Secondly time equally served as a
constraint, there was considerable pressure on time because the study was
conducted side by side with other curricular activities such as regular
lectures, assignment, test, quizzes and sectional examination etc.
Finally, the attitude of the consumers and staff of Amstel Malta Nigeria
Breweries Plc with regarding answering of the questionnaire posed another
problem as most of them felt unconcerned, some of the questionnaires collected
were not properly ansered.
Thanks to the Almighty God that the
researcher was able to complete the
research work successfully inspite of the hubbles of difficulties encountered.
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