ABSTRACT
The
present study -was set to investigate the impact of advertising on the consumer
buying decision. The study was motivated on the premise that having incomplete information
affects decision making process. It is therefore risky for buyers to make
purchasing decision without adequate information. Based on this the present
study was set to investigate the impact of advertising on consumer buying
decision with an emphasis on evaluation alternatives which is a stage in the
buying process. The study adopted a survey research design with a sample size
of 300 consumers using toothpaste using. Four research questions and four
hypotheses were developed to guide the study. The instrument used for the
collection of data was questionnaire. The data collected was analyzed using
descriptive statistics such as mean, frequencies, and percentages, while chi-
square was adopted to test the hypotheses at 0.05 level of significance. Findings
from this study indicated that advertisement have significant impacts on
consumers' buying decision process. The study also indicated that consumers'
final decision to buy the product in the means of alternatives is influenced by
advertisement. The study also indicated that the consumers post purchase
evaluation of the product is also influenced by advertisement. On the basis of
these findings the study concluded that advertising products have significant
impact on the consumers' buying decisions and thus recommended generally that
business organization should adopt advertisement in ensuring that their
products gets the publicity it deserves to attract customers' attention.
TABLE OF CONTENTS
Title i
Certification ii
Dedication iii
Acknowledgement iv
Abstract v
Table of Contents vi
CHAPTER ONE: INTRODUCTION
1.1
Background of the Study 1
1.2
Statement of Problem 3
1.3
Objectives of Study 4
1.4
Research Questions 4
1.5
Research Hypotheses 4
1.6
Significance of Study 5
1.7
Scope of Study 5
1.8
Operational Definition of Terms 5
1.9 References 7
CHAPTER TWO: LITERATURE REVIEW
2.1 Introduction 9
2.2
Conceptual Framework 9
2.3
Theoretical Framework 23
2.4 Empirical
Framework 32
2.5 References 37
CHAPTER THREE: METHODOLOGY
3.1
Introduction 39
3.2
Research Design 39
3.3
Population of the Study 39
3.4
Sampling Technique and Sample
Size 39
3.5
Data Collection Method 40
3.6
Reliability and Validity of the
Data Collection Instrument 40
3.7
Method of Data Analysis 41
CHAPTER FOUR: DATA
PRESENTATION AND ANALYSIS
4.0 Introduction 42
4.1
Socio-Demographic
characteristics of the Respondent 42
4.2
Testing of Hypothesis 44
CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATION
5.0
Summary of Findings 53
5.1
Conclusions 53
5.2
Recommendations 54
5.3
Suggestions for Further Study 55
5.4 Questionnaire
Bibliography
56 Appendix 59
CHAPTER ONE
INTRODUCTION
1.1Background of the Study
Nigeria
as a
sovereign state has remained
a point of
reference in Africa
and on the global stage. This is
stem from the
fact that it is
one of the
largest exporters of
crude oil to developed and developing nations of the world.
For more than three decades therefore, crude oil has
been the major
hub of the energy, revenue
and foreign exchange earnings for
the Nigerian economy
(Abubakar,2015).According to Eke and Enibe (2007), the production and
distribution of petroleum products in Nigeria is an important factor in her
domestic economy.
Petroleum products distribution is
therefore concerned with the movement of refined petroleum from the refinery to
the final consumers across various locations of delivery in the country
(Adeleke, 2002). Until recently, the petroleum products available for distribution
were through an elaborate network of nearly 4,000 kilometers of pipelines inter
connected to 21 widely dispersed depots across the country. Thus, petroleum products
may be obtained from the three local refineries or in the event of a supply
short-fall from off-shore refineries by way of imports.
Transport system permits goods such
as petroleum products to be sold to consumers in places far distant from the
region where they are produced. Economists assert that goods have not been
produced until they have actually been transported to the final consumers who
will satisfy their want (utility) by the consumption of the goods. It therefore
means that transportation by moving goods from point of production to the point
of consumption is fulfilling productive services (Akintayo, 2010). In Nigeria,
refined petroleum products are transported from the refineries through a
network of pipelines, coastal (marine) vessels, road trucks and rail wagons to
the 21 regional storage/distribution depots, spread across the country
(Obasanjo and Nwankwo,2014). It is from these depots that the marketing
companies used to obtain their supplies. Nigeria National Petroleum Corporation
(NNPC) is supplied through imports and locally refined products by both the
major and the independent marketers. From 1970 to date, the nation has invested
substantially in refineries, storage depots, pipelines etc. According to
Ehinomen and Adeleke (2012), the total pipeline network in Nigeria is about
4500Km. Within the past few years, the supply of these petroleum product blends
to storage depots and then to consumers, but have not been enough to meet the
increasing demand. There as of demand include: Domestic sector, Industrial
sector, Transport sector, and Agricultural sectors.
Distribution channel, as defined by
Ilodigwe (2011) is the process of planning, implementing and controlling the
physical flow of materials, final goods and related information from point of
origin to point of consumption to meet customer requirements at a profit.
Proper schedule of the distribution through pipeline networks can facilitate
the economical integration of refinery locations and storage depots for easy
shipment of the products from refineries to depot locations and then to
consumers at minimum delivery cost. Distribution channel, also referred to as
channel of distribution is the path
through which goods and
services travel
from the vendor
to the consumer
or payments
for those products
travel from the consumer to the vendor. Kotler and Armstrong (2001) defined
distribution channel as the marketing function responsible for movement of
products to the final users. As suggested Armstrong (1975), distribution
decisions should be guided by three overall criteria including Market coverage,
that is, the size of the potential market that needs to be served; Control,
that is, control over the product and; Costs, that is, fixed and variable.
The importance of distribution
cannot be over-emphasized no matter how the economic position of the country
looks like. Ehinomen and Adeleke (2012) pointed out that effectiveness in
distribution is essential in bringing down cost of operations with the
consequence reduction of price of products for the benefit of all the
stakeholders in the industry. No wonder, Egede and Ngwoke (2013) lamented that
one of the major problem affecting the price of the essential products (PMS,
AGO and DPK) is the cost associated with outrageous cost of distribution of
these essential products which also affect the official pump price.
1.2
Statement of the Problem
Distribution
channels perform a number of functions that make possible the flow of goods
from the producer to the customer. For one thing, channels provide time, place,
and ownership utility. They make products available when, where, and in the
sizes and quantities that customers want. Distribution channels provide a
number of logistics or physical distribution functions that increase the
efficiency of the flow of goods from producer to customer. Besides, distribution
channels create efficiency by reducing the number of transactions necessary for
goods to flow from many different manufacturers to large numbers of customers.
The importance of distribution
channel cannot be over-emphasized no matter how the economic position of the
country looks like. According to Ehinomen and Adeleke (2012) effectiveness in
distribution is essential in bringing down cost of operations with the
consequence reduction of price of products for the benefit of all the
stakeholders in the industry. Egede and Ngwoke (2013) lamented that one of the
major problem affecting the price of the essential products (PMS, AGO and DPK)
is the cost associated with outrageous cost of distribution of these essential
products which also affect the official pump price.
Uneven distribution channel is one of the major reasons for the persistent
scarcity and inequitable distribution of petroleum products in Nigeria even
with the establishment of three refineries, many storage depots and pipelines
interconnecting them. Against this backdrop, the problem of the present study
is to evaluate the
distribution channel in Nigeria Petroleum industry with particular interest to
Mobil Oil Nigeria Plc.
1.3 Objectives of the Study
This study seeks evaluate the distribution channel in Nigeria
Petroleum Industry with particular interest in Mobil Oil Nigeria Plc.
Specifically, the present study seeks:
1. To
examine the effect of distribution channels of petroleum on the availability of
the product in market.
2. Assess
the effect of cost of transportation on the company’s profitability.
3. To
determine the effect of distribution channel on customer satisfaction.
4. To
assess the effect of government policy on the distribution of petroleum product.
1.4 Research Questions
The following research questions are
formulated to guide the study
1. What
is the effect of distribution channels on availability of petroleum products in
the market?
2. What
is the effect of cost of transportation on the company’s profitability?
3. What
is the effect of distribution channel on customer satisfaction?
4. How
does government policy affect the distribution of petroleum product?
1.5 Research Hypotheses
H01:
Distribution channels do not affect availability of Petroleum Products in the
market.
H02:
Cost of transportation has no effect on the companies profitability.
H03:
Distribution Channels do not affect customer satisfaction.
H04:
Government policy does not affect distribution of Petroleum Products in the
market.
1.6
Significance of the Study
Managers and administrators of
manufacturing industries will benefit from this study as it will guide them in
decision making. This is because the importance of evaluation of the
effectiveness of channels of distribution is to help firms and organizations
plan for better utilization of them. One of such decision is the marketing
channel decision.
Researchers and academicians will
specifically benefit from this study as it is hoped to form a foundation from
which further study could be carried out aimed at improving knowledge. It is
also relevant in the review of literatures for related study.
Another
contribution of this study lies on the fact that findings from this study which
attempt an explanations on the effectiveness of channels of distribution on
sales volumes. This knowledge will serve as a reference point to other
industries that may be in need of such knowledge to take decision that will
move their organization to a new level of success.
1.7 Scope of the Study
The study is an evaluation of the
distribution channel in Nigeria Petroleum Industry: a study of Mobil Oil
Nigeria Plc. The study focuses on examining the effect of distribution channels
on the availability of the product in market; on cost of transportation; on
customer satisfaction; and the effect of government policy on the distribution
of petroleum product. The period of study covers five years between 2010 and
2015.
1.8 Operational Definition of Terms
Distribution
Channel: As used in this study, distribution channel refers
to media to which products are moved from the source to the end user.
Petroleum Products Distribution: Within the context of this study,
petroleum products distribution has to do with the movement of refined
petroleum from the refinery to the final consumers across various locations of
delivery.
Nigeria Petroleum Industry: This is an industry that deals with
the production and distribution of petroleum products such as PMS, AGO and DPK.
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