CHAPTER ONE

INTRODUCTION

1.1 Background to the Study

The marketing strategy is a set of controllable marketing variables that the firm blends to produce the response to it wants in the target market. The marketing consists of everything that the firm can do to influence the demand for its product. The variables are often referred to as the ‘’Four Ps’’ which are product, price, place and promotion. Marketing has changed over the centuries, decades and years. The production centered system systematically changed into relationship era of today and over the period; the specializations have emerged such as sales versus marketing and advertising versus retailing.

Nowadays fierce competition creates challenges for companies in attracting customers and convincing them into buying their products instead of the competitors’ products. To be able to attract customers there is a need to understand the consumer buying process (Pelau, 2011). It is no longer possible for companies only to rely on keeping a low-cost production and aiming for a high volume of sales to stay in business; customers’ needs are now the main focus and companies need to be able to achieve customer satisfaction to remain competitive (Ji& Wang, 2010). In order to create a suitable marketing strategy, companies need to have an understanding of customer needs and the consumer buying process (Pelau, 2011).

With the increasing competition, most of companies are searching for creative ways to stay ahead of the market (Pingjun & Rosenbloom 2005). A study by Chatura, McDougall and Bansal in (2005), has argued that there are different ways to keep ahead of the competition, nevertheless knowing your customer needs should always be priority, because the customer needs or demand can change dramatically due to the high development in different market areas. According to Solomon, Michael R., et al. (2018), in today’s highly competitive market companies don’t have many options to survive.

Traditionally most of the companies were focusing on lowering the cost in order to be able to compete with low price, however this option may not available for all the companies and it cannot be the only solution, therefore, a study by Vilasini&Khanna (2016) concluded that it is very important for business to focus on the customer needs and a customer behavior in the buying process. According to Ilyoo B (2015) it is very important for the enterprises to understand the cycle of buying process, because only through the buying process models’ companies can understand their customer needs.

Nikolaos (2016) has argued that knowing your customer needs is one of the key solutions, but it is not enough to solve all the problems. Companies need to consider certain environment of information regarding its product. Also, companies need to know the strategies to use to penetrate the market. Market penetration strategy is one of the four business growth strategies identified in the Ansoff Matrix, the other three being market development strategy, product development strategy, and diversification strategy.

Companies must be competitive to serve chosen segments effectively by developing suitable marketing strategies in a meaningful and sustainable way. Marketing strategy has become a helpful tool in the competitive market environment for any organization in the world to remain and become stronger (Burke &Litwin, 2012). Ambler, Kokkinaki, and Puntoni (2014) argue that a good marketing strategy needs informing an organization where it wants to be on a long-term basis, so marketing strategy is often said to be a constant method.

The strategy regarding expansion of markets entails a method used by the organization to attract new and more customers or enhancing usage of the already existing product and service (Kotler& Keller, 2017). Gado (2013) observe that sustained presence of businesses requires on-going consideration of how market growth approach affects performance behaviours of their businesses. How coherent their market growth with the performance of such businesses is anticipated to have consequences for their survival.

According to Slater and Narver (2016) market strategy involves organizations products and services are sold in existing markets. Therefore, the goal of the strategy for market penetration is to concentrate on increasing the current product or service market share on the existing market. According to Levay, Drossinos and Thiel (2017) organizations adopt market penetration strategy to increase income from sales without altering the products or services.

Therefore, it is argued that the after assessing the multiple alternatives and their intrinsic hazards, the selection of penetration mode is made at company level and is therefore a strategic decision for the company. The prevailing attitude and approach of the production orientation era was “consumers favor products that are available and highly affordable”. The mantra for marketing success was to “improve production and distribution”. The rule was “availability and affordability is what the customer wants”. The era was marked by narrow production-lines; pricing system based on the costs of production and distribution.

The elements of marketing strategy affect consumer purchasing decision in different ways. Many factors affects indirectly the way consumers act towards different products especially in their purchasing decision.

Consumers behave differently to marketing activities of different organization. For example, a consumer can see the use of penetration pricing strategy as a bad strategy due to the fact that a cheap price attached to a product show that the product lacks quality and other group of consumers can accept the penetration pricing strategy due to the fact that it falls into a budgetary allocation.

Consumer purchase decision is a major issue in marketing which goes a long way in determining the various actions of organizations in marketing their product. In Cameroon, consumer purchase decision is influenced by the brand, the price of the product and availability of the product and most especially, the promotional strategies used in promoting the product. This study is focused on analyzing the impact of various marketing mix elements on consumer purchasing decision.

1.2 Statement of the Problem

The effect of marketing strategy in the overall success of an organization cannot be over-emphasized. Decision makers today spend a lot of resource in making sure that they make the right decision on the product they buy because they want to understand the product they buy, why they would buy those particular and how to buy them. So these questions attached to the buyer decision-making are what we seek to understand while making marketing strategy the basis and how they make the consumer decision.

The plastic industry in Limbe (Bobdidy), Cameroon, has been in constant flux as a result of economic liberalization; competition has been fierce, compelling all businesses in the sector to adapt to the changing climate. Bobdidy has faced various hurdles in implementing market expansion strategies as a result of the large number of plastic companies operating in the same market.

At the same time, several firms have become more competitive by launching initiatives; nevertheless, given the current crisis in the subsector, many organizations are confronting the same issues. Managers of Bobdidy will need to adopt appropriate strategies to help them improve the organization’s performance in such an unpredictable environment.

Marketing strategy techniques, according to the World Economic Forum, are critical in influencing consumer purchasing behavior. For a long time, there has been minimal competition in Cameroon, and lots of space for expansion. Furthermore, high-end and middle-class customers had few options: either make multiple journeys to the mutengene area or visit one of the large factories where everything was available.

However, the transition of Cameroon plastic firms has been expedited by years of growing purchasing power and changing consumer demands. Some Limbe stores still purchase plastic products such as nylon bags and other towns such as Buea, Douala, Yaoundé, and Garoua. Along with retail stores the popularity and penetration of plastic bags has increased in the country (Cytonn, 2018) As a result, firms face a difficulty in attracting and retaining customers who will stick to their products. This necessitates an understanding of how these clients behave. This knowledge could help firms improve their competitiveness and ensure their long-term viability.

Consumer behavior refers to how people behave while they are looking for, buying, using, assessing, and discarding things and services that they believe will meet their requirements. Individual preferences, choices, and tastes all influence consumer purchase behavior. Other aspects, including as cultural, social, personal, and psychological considerations, influence consumer behavior, some of which marketers have no control over (Hanaysha, 2018).

1.3 Research Question

1.3.1 Main Research Question

The main research question of this study is to what extent is the effect of marketing strategy on consumer purchase decision?

1.3.2 Specific Research Question 

1. To what extent does pricing strategy influence consumer purchase decisions?
2. How does the distribution channel influence consumer purchase decisions?
3. Does advertising influence consumer purchase decisions?

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