CHAPTER ONE
INTRODUCTION
1.1 Background of the study
Brands are always considered as a best tool for marketing and business strategy. As the communication systems are getting advanced day by day, it shrunk the distances, thereby linking markets through flows of information across markets. This trend increased the competition levels as well. “A brand is defined as a specific name, symbol or design- or, more usually some combination of these- that is used to distinguish a particular seller’s product” (Doyle, 2002). During the immature stage of consumer behavior, consumers’ limited experience with modern marketing makes them depend on reputable brands and track records. Sometimes consumers rely on price as a mark of quality. Therefore the brand effect is very important to study. Brands accounted for one-third to one-half of all consumers’ expressions of intent to purchase. In Indian continent, the consumer’s expectations of product quality in general have been steadily rising, owning to the increase in income and sociological forces, which have prompted high expectations of a better lifestyle. Indian consumers today are looking for aesthetic and social value instead of just focusing on the basic needs of warmth and the protective function of products. Department stores are now crowded with people, but few of the shoppers are serious buyers. Indian consumers are eager to see what is available, especially from among foreign products.
So, a brand, in short, can be defined as a seller’s promise to provide consistently a unique set of characteristics, advantages, and services to the buyers/consumers. It is a name, term, sign, symbol or a combination of all these planned to differentiate the goods/services of one seller or group of sellers from those of competitors.
Brands are Trustmarks According to a Time magazine article on product sameness, “you’d have to be a true expert to tease out any meaningful difference among dozens of detergents, cars, cereals, enhanced waters, or running shoes.” This perception of sameness points to why many marketers place more emphasis on consumer experiences than brand functionality when building a brand in the minds of consumers. Favorable experiences form strong emotional bonds that convert into brand preference. Millward Brown, a global research agency, says that strong brands are “trust marks.” They truncate the decision-making buying process. Consumers can shop without scrutinizing product features and benefits. Moreover, brands routinely command premium prices, because they are trust marks. Brand Experiences In a Columbia University research paper titled “Brand Experience: What is It? How Do We Measure It? And Does It Affect Loyalty?” researchers identified five dimensions of the brand experience: sense, feel, think, act and relate. Sense experiences are the sensory or aesthetic qualities of the brand. Feel experiences are the moods or emotions that brands induce in consumers. Think experiences stimulate the imagination and intellect — “the brand makes me think about the happy times in life.” Act experiences stimulate behavioral reactions — “the brand makes we want to work out.” Relate experiences refer to the social context of the brand experience — “I feel like I'm a member of an exclusive club.” Brands might not incorporate all five dimensions of the brand experience. The intensity of relevant experiences, however, drives the strength of brand preference in consumers. Branding Strategies The brand experience incorporates all consumer contact with the brand from advertising and promotions to after-sale customer service. Your customers will evaluate your brand and regulate their behaviour based on these interactions. For instance, poor customer service is toxic to a brand. Branding strategies will differ by product or service category, consumer familiarity and many other variables. You can study successful brands in your category and in other categories. These can be a rich source insight for developing your branding strategies. Among the many factors that are believed to influence consumer perceptions of products in an age of international competition, country-of-origin (COO) effects, remains the most researched. We can underline that COO is considered an important differentiating factor in consumer attitudes to foreign and local brand names. COO has been defined as the country where the corporate headquarters of the company marketing the product or brand is situated.
Understanding of Brand and Brand value: A brand, as defined by Keller, is “a product, but one that adds other dimensions that differentiate it in some way from other products designed to satisfy the same need (Biplab, S. B., 1998). These differences may be rational and tangible – related to product performance of the brand – or more symbolic, emotional, and intangible – related to what the brand represents”. Mariotti (1999) defines a brand as “a simplified ‘shorthand’ description of a package of value upon which consumers and prospective purchasers can rely to be consistently the same (or better) over long periods of time (Biplab, S. B., 1998). It distinguishes a product or service from competitive offerings”. Khalid Mahmood Khan, director of Kay Kraft, an emerging local brand said that the key to ensure brand loyalty is to increase the value of the brand in the mind of the consumer. He also argued that to build brand value, factors such as product improvements, package design, communicating the competitive positions and promotion.
1.2 STATEMENT OF THE PROBLEM
Research in consumer behavior shows that we have a consumer driven society where the ultimate motive of business products and service is to satisfy consumer expectation makes them happily and remain loyal to the brand. Therefore, a perfect understanding of consumer behavior is determining.
- The psychology of the consumers and how they make decisions between depending on their needs and brand awareness
- how service or products providers make to implement the best branding strategy for their product a service (e.g culture, family, signs, media).
- The various stages a consumer gives through before purchasing a product or service.
- What factors determine consumer’s loyalty or repeat purchase of the brand” is crucial in meeting customer’s satisfaction and brand loyalty. Therefore, an attempt to reach out to the consumer effectively demands a suitable banding strategy since consumer buying decision making and loyalty is affected by various branding strategies. In an industry characterized by stuff competition an effective branding strategy is significant not only to attract customers but to create customer loyalty to the brand.
Therefore, this research seeks to investigate the impact of branding on case study of Diamond Bank Plc.
1.3 OBJECTIVES OF THE STUDY
- To determine the nature of branding and branding strategies
- To determine the nature of consumer behavior
- to determine affective branding strategies that would impact on consumer behavior
- To investigate the impact of branding on consumer behavior
- To investigate the impact of branding on consumer behavior in Diamond Bank Plc.
1.4 RESEARCH QUESTION
- What is branding?
- What is consumer behavior?
- What is the nature of branding strategies?
- What extent does branding impacts in consumer behavior.
1.5 SIGNIFICANCE OF THE STUDY
- To provide a detail analysis on the nature of consumer behavior
- To provide detail analysis in the nature of branding an branding
Strategy
- To provide detail appraisal on the impact of branding in consumer
behavior
- To serve a reference point of information in branding consumers’
behavior and of the various branding strategies.
1.6 SCOPE AND LIMITATION OF THE STUDY
The study focuses on the impact of branding on consumers’ behavior with a case study of Diamond Bank Plc. Branding is a specific or unique idea, any image or any specific name of any product or service with which the consumers can connect very easily. Branding thus, become a process of using that unique idea, name to make your product distinct from others. It helps to identify one’s product or services. Thus, in the minds of consumers a brand becomes a promise that promise which will fulfill the needs of the consumers. Kotler P (1999).
The study however has the following limitation:
Finance is a major constrain or limitation to this study because of the limited nature resources the scope of the study is mainly on diamond bank alone.
Time is another factor that limit the scope of the studies, though” time is the only currency shared amongst men equally” yet it is very limited in nature, as time allocated for the studies does not permit a broader view.
1.7 DEFINITION OF TERMS
DEFINITION OF BRANDING
Branding is a specific or unique idea, any image or any specific name of any product or service with which the consumers can connect very easily. Branding thus, become a process of using that unique idea, name to make your product distinct from others. It helps to identify one’s product or services. Thus, in the minds of consumers a brand becomes a promise that promise which will fulfill the needs of the consumers. Kotler P (1999).
DEFINITION OF CONSUMER BEHAVIOUR
Consumer behavior is a branch of marketing which deals with the various stages a consumer goes through before purchasing products or services. It deals with how commercial and social information sources influence of culture, sub-cultures, social class, membership and reference groups on buying behavior. How buying decision extend beyond the individual to the family and the household, the roles of motivation, perception, learning, personality and attitudes in shaping consumer behavior and the importance of statistical factors in buying. Senguptha J. S. (2011).
Marketing
Marketing is the study and management of exchange relationships. The American Marketing Association has defined marketing as “the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. The techniques used in marketing include choosing target markets through market analysis and market segmentation, as well as understanding methods of influence on the consumer behavior.
From a societal point of view, marketing provides the link between a society's material requirements and its economic patterns of response. This way marketing satisfies these needs and wants through the development of exchange processes and the building of long-term relationships.
In the case of nonprofit organization marketing, the aim is to deliver a message about the organization's services to the applicable audience. Governments often employ marketing to communicate messages with a social purpose, such as a public health or safety message, to citizens.
Consumer behavior is the study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society.
product is anything that can be offered to a market that might satisfy a want or need. In retailing, products are called merchandise. In manufacturing, products are bought as raw materials and sold as finished goods. A service is another common product type.
Commodities are usually raw materials such as metals and agricultural products, but a commodity can also be anything widely available in the open market. In project management, products are the formal definition of the project deliverables that make up or contribute to delivering the objectives of the project. In insurance, the policies are considered products offered for sale by the insurance company that created the contract. In economics and commerce, products belong to a broader category of goods. The economic meaning of product was first used by political economist Adam Smith. A related concept is that of a sub-product, a secondary but useful result of a production process.
Dangerous products, particularly physical ones, that cause injuries to consumers or bystanders may be subject to product liability.
1.8 ORGANIZATION OF STUDY
This research work is organized in five chapters, for easy understanding, as follows
Chapter one is concern with the introduction, which consist of the (overview, of the study), statement of problem, objectives of the study, research question, significance or the study, research methodology, definition of terms and historical background of the study. Chapter two highlight the theoretical framework on which the study its based, thus the review of related literature. Chapter three deals on the research design and methodology adopted in the study. Chapter four concentrate on the data collection and analysis and presentation of finding. Chapter five gives summary, conclusion, and recommendations made of the study.
1.9 HISTORICAL BACKGROUND OF DIAMOND BANK
Diamond Bank Plc began as a private limited liability company on March 21, 1991 (the company was incorporated on December 20, 1990). Ten years later, in February 2001, it became a universal bank. In January 2005, following a highly successful Private Placement share offer which substantially raised the Bank’s equity base, Diamond Bank became a public limited company.
Since the Bank was incorporated in December 1990, Diamond Bank has challenged the market environment by introducing new products, innovative technology and setting new benchmarks through international standards.
Today, Diamond Bank is best placed to respond to changing lifestyles and is leading the digital transformation in response to these societal shifts. For example, Diamond Mobile is Africa’s leading banking app and the first with touch ID.
Delivering an enhanced customer experience is fundamental to the Diamond Bank proposition. We aim to support our customers via our tailored services, such as Diamond Woman, so that they can manage their lives seamlessly whether on-the-go or in branch – in other words, we want to go ‘Beyond Banking’.
Overall, our people remain the key differentiating factor in providing this unique customer experience across all markets where we operate and we are fully committed to consistently attracting only the best people to maintain our competitive edge.
Diamond Bank has a retail-led strategy, meaning it is well placed to benefit from Nigeria’s attractive fundamental macro-economic trends, particularly in the retail market.
The Bank also has a strong Corporate Banking offering that is helping to fuel growth across Nigeria through supporting businesses, redefining the country’s 21st century economy.
The Bank serves over 150,000 businesses of varying size across diverse sectors including Corporate clients as well as MSME (Micro Small and Medium-Scale Enterprises), for which it provides value-adding banking solutions.
With a primary listing on the Nigerian Stock Exchange and GDRs on the London Stock Exchange, Diamond Bank’s footprint extends beyond Nigeria, with a strong presence in the Republic of Benin and branches in Senegal, Togo and Ivory Coast – making it the first Nigerian bank to operate in Francophone West Africa. The Bank launched its first non-African subsidiary – Diamond Bank, UK –in 2013. As of January 2016, the Bank operated 271 branches across Nigeria and 317 across the Group.
Diamond Bank has frequently been the partner of choice for leading international organisations such as the International Finance Corporation (IFC) and the UK’s Department for International Development (DfID), in order to deliver programmes targeting MSMEs and to promote financial inclusion.
The Carlyle Group, the global alternative asset manager, became a significant shareholder in November 2014 following its $147m investment in the Bank. This was a major milestone for Diamond Bank and a sign of confidence in the Bank’s strategy and market opportunity.
