Effect Of Price On Consumer Patronage Of Soft Drinks: (A Study Of 7up Bottling Company Aba Abia State)

Abstract

The study focused on the effect of price on consumer patronage of soft drinks (A study of 7up bottling company Aba Abia State). The specific objectives are to ascertain the effect of price on consumer repeat purchase of soft drinks in Aba, to examine the effect of price on consumer frequency of purchase of soft drink in Aba, to determine the effect of price on volume purchase of soft drink in Aba, to evaluate the effect of price on brand switching of soft drinks in Aba, and to determine the relationship between price and consumer patronage of soft drinks in Aba. The research design adopted was descriptive research design and it shows in detailed the plan how the researcher intend to carry out the study according to the research question and hypotheses stated in chapter one in other to achieve the research objectives. The population of the study comprised of staff and customers of soft drink seven up bottling company in Aba Abia State. The population therefore involves entire population which is 220660 according to (NPC, 2006). The study adopted a well-recognized and acceptable formular called Taro Yamane to determine the sample size which is one hundred and thirty three (399). The study made used of primary source of data which involve distribution of questionnaire to the respondents to enable them express their feelings as regards the products offer by the firm. The study adopted correlation coefficient and ANOVA analyses of varience to analyze the stated hypotheses. empirical results the study revealed that there is positive and significant relationship between Price (0.031) consumer’s repeat purchase of soft drinks in Aba, there is positive and significant relationship between Price (0.011) and consumer frequency of purchase of soft drinks in Aba, there is a significant different between price (0.017) and the volume of purchase of soft drink in Aba Abia State, there is a significant different between price (0.001) and brand switching of soft drink consumers in Aba Abia State while there is positive and significant relationship between price (0.004) and consumer patronage of soft drinks in Aba. It was recommended that management of the selected soft drink firm to take into cognizance the prices of it product because consumer react to the prices of goods irrespective of the quality and also there is need for sellers to set the prices according to the forces of demand and supply in other to induces consumer repeat purchase for soft drinks.

Keywords: Price and consumer patronage for soft drinks

TABLE OF CONTENT

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study ﾿ 1

1.2   Statement of the Problem ﾿ 3

1.3 Objective of the Study  ﾿ 4

1.4   Research Questions ﾿ 4

1.5   Research Hypotheses ﾿ 4

1.7   Scope of the Study ﾿ 5 

1.8   Limitations of the Study ﾿ 6

CHAPTER TWO

REVIEW OF RELATED LITERATURE

2.1 Conceptual Framework ﾿ 7

2.1.1 Pricing Strategy Defined ﾿ 8

2.1.2 Price Defined ﾿ 8

2.1.3 Concept of Pricing ﾿ 10

2.1.4 Pricing Objectives ﾿ 10

2.1.5 Pricing Methodology ﾿ 12

2.1.6 Factors That Affects Product Pricing ﾿ 14

2.1.7 Pricing Policies and it Effect on Consumer Patronage ﾿ 15

2.1.8 Promotional Pricing of Some Firms in Nigeria ﾿ 19

2.1.9 ﾿ Consumer/Buyer Behaviour Defined ﾿ 20

2.1.10 Reasons for the Study of Consumer Behaviour ﾿ 21

2.1.11 Cost-Based Pricing ﾿ 23

2.1.12 Value-Based Pricing ﾿ 25

2.1.13 Demand-Based Pricing ﾿ 26

2.1.14 Competition-Based Pricing ﾿ 27

2.1.15 Strategies for New and Established Products ﾿ 27

2.1.16 New Product Pricing Strategy ﾿ 28

2.2 Theoretical Framework ﾿ 28

2.2.1 Information Processing Theory ﾿ 28

2.2.2 Social Learning Theory ﾿ 29

2.3 Empirical Review ﾿ 30

2.4 Summary of Related Literature ﾿ 32

CHAPTER  THREE

METHODOLOGY

3.1 Research Design ﾿ 34

3.2. Study Area ﾿ 34 

3.3 Population of the Study ﾿ 35

3.4 Sample Size Determination    ﾿ 35

3.5 Method of data collection ﾿ 36

3.6 Sampling Procedure and technique ﾿ 36 

3.7 Validity of Research Instrument ﾿ 36

3.8 Reliability of the Instrument ﾿ 37

3.8.1 Method of Data Analysis ﾿ 37 

3.9. Model Specification ﾿ 37

CHAPTER FOUR

RESULT AND DISCUSSION

4.1 Data presentation, interpretation and analysis ﾿ 40 

4.1.3. Rate the effect of price on consumer repeat purchase of soft drinks in Aba? ﾿ 43

4.1.4. Rate the effect of price on consumer frequency of purchase of soft drink in Aba? ﾿ 44 

4.1.5. Rate the effect of price on volume purchase of soft drink in Aba? ﾿ 45

4.1.6. Rate the effect of price on brand switching of soft drinks in Aba? ﾿ 46

4.1.7. Rate the relationship between price and consumer patronage of soft drinks in Aba? ﾿ 47

4.3.1 Test of Hypothesis 1 ﾿ 47

4.3.2 Test of Hypothesis 2 ﾿ 48

4.3.4 Test of Hypothesis 3 ﾿ 49

4.3.4 Test of Hypothesis 4 ﾿ 50

4.3.5Test of Hypothesis 5 ﾿ 51

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATION

5.1 ﾿ Summary ﾿ 53

5.2 Conclusion ﾿ 54

5. 3 Recommendations ﾿ 54

LIST OF TABLES

4.1.: Data Presentation/ Results and Discussion ﾿ 40

4.1.2: Distribution of the respondents according to their socio economic characteristics  ﾿ 41

4.1.3 Effect of price on consumer repeat purchase of soft drinks in Aba? ﾿         ﾿ 43

4.1.4 Effect of price on consumer frequency of purchase of soft drink in Aba? ﾿         ﾿ 44

4.1.5 Effect of price on volume purchase of soft drink in Aba? ﾿         ﾿ 45

4.1.6 Effect of price on brand switching of soft drinks in Aba? ﾿         ﾿ 46

4.1.7: Relationship between price and consumer patronage of soft drinks in Aba? ﾿         ﾿ 47

4.1.8: Price has no significant effect on consumer repeat purchase of soft drinks in Aba    ﾿ 47 ﾿  

4.1.10: Price has no significant effect on volume of soft drinks purchase in Aba ﾿         ﾿ 49

4.1.10: Price does not significant influence brand switching behavior of 

soft drink consumers in Aba ﾿ ﾿ 50