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THE BASES FOR EFFECTIVE MARKET SEGMENTATION IN A SERVICE ORGANIZATION IN ENUGU METROPOLIS (A STUDY OF MTN NIGERIA LIMITED)

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Abstract

Today in the global market environment, there are many buyers, these buyers differ in one or more variable. Thus, the differences may include the wants, purchasing power, geographical location, buying attitudes, any of these variables stand as a basis of segmenting a market. Segmentation is a marketing terminology used in the marketing field and is of great importance for any product that dreams of passing through the preliminary growth stage to the maturity stage in the product life cycle. This research work is meant to critically appraise the bases for effective market segmentation in a service organization focusing on MTN, Enugu. For a successful completion of this research work, the researcher will make use of both primary and secondary methods of data collection for gathering information. Primary data were collected through, Questionnaire administration, Oral interview, and Personal observation and secondary data were collected through, periodicals and journals and textbook and l

INTRODUCTION

• BACKGROUND OF THE STUDY

In the modern and dynamic world today marketers look at the overall market as a body consisting of many smaller part whose element have some characteristics. They are mostly distinct from the market entirely. For marketers entering a market, the total market must be divided into segments or divisions with similar wants and needs or behaviour.

Adirika, Ebue and Nnolim (2006, 40) Noted that most markets are too large for organizations to provide all the needs of the buyers of the market, some  delimitation of the market is necessary for the sake of efficiency and because of limited resources, this makes segmentation inevitable.

According to Edoga (2003: 86) marketing segmentation is the process of dividing the total market into relatively homogenous groups with similar product interest. This process according to marketers requires identifying factors that affect purchasing decision so that consumers can be grouped accordingly.

Adirika and Nnolim (2006: 39) see market segmentation as sub dividing of a heterogeneous market into homogenous subject or groups can conceivable be selected as a separate market target to be reached with a distinct marketing mix.

They further noted that in segmentation and consequently target market organizations endeavour to serve target markets they are able to satisfy efficiently and effectively and not just any group of buyers that seen to represent a sizeable market. Segmentation strategy is based on the promise that customers have different preferences which changes over time organizations including banking industry must make decisions on two areas of needs:

1. What needs to serve, and
2. Whose need to serve

Markets consist of buyers who differ in wants, purchasing power, and geographical location, buying practices. Any of the variable can be used to segment a market in to today’s marketing environment. We have group economy segmentation which is giving a better view of what marketing concept is all about. A company that decides to operate on a broad or differential market, whether consumer, industrial, reseller or government recognizes that it cannot serve all consumers in a given market.

Unamka and Ewurum (2005: 254) said that in employing this strategy a seller must recognize that his total heterogeneous market is made up of many smaller heterogeneous units.

Each of this smaller units have a different set of wants, motivation and other characteristics, with segmentation a seller is in a better position to spot and compare marketing opportunities and can make finer adjustments of his products and marketing appeals. Management can do a better marketing and make efficient and effective use of its resources by tailoring market programmes to individual market segment. It is because of the importance of segmentation that this study become necessary.

 

• STATEMENT OF THE PROBLEM

Segmentation is a marketing concept that ensures that the target markets of a firm are divided into segments effectively and efficiently satisfy the market. The problem to be address by this research study is the fact that most companies effective strategies in segmenting their target market thereby lead to low patronage and in turn low profit. Another problem is that most of them that can effectively segment their target market do not really consider their target customers while segment the market. Therefore they do not practice the marketing concept which aims at customer’s satisfaction. Their customers are therefore not satisfied with the products and services.

 

• OBJECTIVES OF THE STUDY

The main objective of this research work is to appraise the bases for effective market segmentation in a service organization in Enugu metropolis focusing on MTN Nigeria.

Other objectives include the following:

1. To examine MTN Nigeria effectively and efficiently segments it’s market.
2. To find out whether segmentation strategies adopted by the company enhance its growth.
3. To find out whether this strategies enhance the company’s profitability.
4. To find out whether the segmentation practice of the company are satisfied with it’s product and services.
5. To make recommendations were necessary.

 

• FORMULATION OF HYPOTHESES

In order to find a dependable solution to these research problems, the following research hypotheses were formulated.

 

Hypotheses  One

Ho:  MTN Nigeria does not segments its market effectively and efficiently.

Hi:   MTN Nigeria segments its market effectively and efficiently.

Hypotheses  Two:

Ho:  Market segmentation practices of MTN Nigeria do not lead to increased patronage of their products.

Hi:   Market segmentation practices of MTN Nigeria lead to increased patronage of their products.

Hypotheses Three:

Ho:  Market segmentation does not impact positively on the profit of the company.

Hi:   Market segmentation impacts positively on the profit of the company.

Hypotheses Four

Ho:  The customers of company are not satisfied with its products and services.

Hi:   The customers of company are satisfied with its products and services.

 

Hypotheses Five

Ho:  The market segmentation practices of MTN Nigeria do not lead to effective marketing activities of the products.

Hi:   The market segmentation practices of MTN Nigeria lead to effective marketing activities of the products.

• SIGNIFICANCE OF THE STUDY

This research work will be of immense importance to the following group of people:

The management and staff of MTN Nigeria. This research work will go a long way in enlightening them on how the communication industry segments its services and the essence of this segmentation to the performance of this industry.

This research will also be of immense importance to students and researchers. This group of people will widen their scope from information contained in this research work.

 

• SCOPE OF THE STUDY

This research work boarders on the segmentation in Enugu metropolis is focused on MTN Enugu.

 

• DEFINITION OF TERMS

• Market: According to Adirika, Ebue and Nnolim (2006: 37), market is an arena for potential exchange.
• Segmentation: According to Edoga (2003: 86) market segmentation is the process of dividing the total market into relatively homogeneous groups with similar products interest.
• Marketing Segment: Kotler (2002: 279) stated that it consists of a group of consumers who share a similar set of wants.