The topic of this research work is product differentiation as a competitive tool in the marketing of soft drinks (A case study of Limca Bottling Company).

Chapter one focuses on the introductory aspect of this work e.g. problems of the topic, objectives of the research, and research hypothesis. The review of different writers’ opinion on this research work constitutes chapter two, which is the literature review, it goes further to examine the effect of product differentiation on the profitability of the company. Under this chapter, different forms of product differentiation and market segmentation were also looked into.

Chapter three deals with the research methodology, this covers the method used in the collection of both primary and secondary data, presentation analysis interpretation of data and testing of hypothesis is dealt in chapter four.

The chapter five attempts to make some suggestion and valuable recommendation essentially to Limca Bottling Company which if properly implemented, will go a long way in helping the company in the area of product differentiation and also in market segmentation.

TABLES OF CONTENTS

Title page i

Dedication ii

Acknowledgement iii

Tables of content iv

Abstract v

CHAPTER ONE

1.0 Introduction 1

1.1 Background of the study 3

1.2 Statement of the problem 3

1.3 Objectives of the study 5

1.4 Research question 5

1.5 Statement of hypothesis 6

1.6 significance of the study 7

1.7 Scope of the study 8

1.8 Limitation of the study 8

1.9 Definition of terms 9

CHAPTER TWO

2.0 Literature review 12

2.1 Introduction 12

2.2 History of the soft drinks industry 12

2.3 Market segmentation 13

2.4 Base for product differentiation 28

2.5 Competition environment 29

2.6 Marketing approach to competition 31

2.7 Strategies for market challenges 38

2.8 Strategies for market followers 40

CHAPTER THREE

3.0 Research methodology 45

3.1 Research design 45

3.2 Sources of data 46

3.3 method of data collection 47

3.4 Population of the study 48

3.5 Sampling techniques 48

3.6 Validity and reliability of instrument 49

3.7 Method of data analysis 49

CHAPTER FOUR

4.0 Presentation of data 52

4.1 Analysis and presentation of data 52

4.2 Research question 53

4.3 Testing of hypothesis 62

CHAPTER FIVE

5.0 Summary recommendation and Conclusion 68

5.1 Summary 68

5.2 Recommendations 71

5.3 Conclusion 73

References 74

Appendixes 78

CHAPTER ONE

1.0 INTRODUCTION

1.1 BACKGROUD OF THE STUDY

Here is Nigeria where few soft drink industries exist could be said with high degree of precision that those firms are practicing product differentiation in the market.

This project will research into how effectively, efficient product differentiation is employed as a competition tool in the marketing of soft drink; how it helps the profitability of the company, also the problem and task involved in products differentiation will be investigated with some particular reference to limca bottling company. Bottlers of limca, real - soda and Gold spot.

Any organization that decides to operate in soft drink industry must recognize that it can neither save nor appeal to the total market with one product or one Marketing Mix . The idea is born out of the fact that the buyers may be too numerous widely spread and different in their purchasing behaviour.

Product differentiation is a competitive tool in the marketing of soft drinks and the prospects of product differentiation are the profits. Increasing sales, increasing market share, improved company image goodwill etc. product differentiation is not without its own problems. The major problem encountered in differentiating the market trend so as to know and follow the market trend, marketers knows that not every person is a consumer or customers. They know that consumers go more than some specific qualities in a product hence they [marketer] endeavor to science various segmentation in the market by introducing a variety of product innovation is the basic tool of serving and satisfying different segments in market and offering varieties of product for instance , markets thinks that the market is a of homogenous buyers while the market is a interogeneous in one product. Some people take it in order to feel relaxed so that the company will favour her product appeal to satisfy the needs of her various consumers in realization of this, the marketer showed know that the market is always nitrogen [Gousize. Okpara 2002: 2003] .

Tool for competitive edge. [Gazi S. Okpara 2002:2003 when the product of a company faces seven competition sales could be increased over those of rivets through innovation the price of innovation here would be to create a distinct value in a product from the offend by the rivals.

Supporting this assertion, Akande [1984:11] wrote “when product have become established and one feting the brunt of sever competition attempts at increasing company market share many be pursued through product reformulation or product replacement reformulation is often undertaken to give added value to the consumers and the consumer and a competitive edge through new features.

1.2 STATEMET OF THE PROBLEM

Business fail these days because those responsible for formulating strategies and objectives, lack the foresight in identifying the various psychological needs and difference existing in those markets the company served. For any business to succeed it must have a depth knowledge of the market it is serving and must be able to develop strategies to satisfy the consumers of her product among the main strategies the can be used are.

After sales services
Discount
Product modification etc

In this study specific problems that will be addressed include the following.

Inability to create strategies to satisfy their costumers
Inability to create feasibility study for their product
Inability to identifying the various psychological needs and differences existing in these market which the company served

1.3 OBJECTIVES OF THE STUDY

The main objectives of this project are to look into this impact of product differentiation as a competitive tool the specific objectives include.

Examination of the effect of product differentiation on the competitive trend of the company
Determination of the impact of the product differentiation on the profitability of the company
Examination of the role of product differentiation on the market
Identification of the problems the company faces in differentiating its product.

1.4 RESEARCH QUESTION

For the purpose of these researches the following are formulated to assist the researcher to identify the importance of product differentiation as a competitive tool in the marketing of soft drink.

Is product differentiation being used in the firm’s
What are the bases for differentiating the product?
Has product differentiation any significance on the market share of the company/
Has product differentiation any impact on the competitive trend of the firm?
What effects does product differentiation have on the profit of the organization?

1.5 STATEMENT OF HYPOTHESIS

For the purpose of this research were the following hypothesis shall be fasted as they relate to the survey work under consideration.

HO: Product differentiation does not improve profit of the firm.

Hi: The product differentiation has a significant effect on the profit of the firm.

Ho: Product differentiation does not improve the competitive capability of the firm.

Hi: product differentiation improves the competitive capability of the firm.

1. SIGNIFICANCE OF THE STUDY

Any company producing highly competitive product need to differentiate her product so as to distinguish her product (s) from that of the competitors as well as to be able to respond well to the challenges of the market competition, this research work will look more on the prospects of product differentiation as a competitive tool. This will be useful to business owners especially small business owners who will than learn that it pays to differentiate ones products as this policy will helps increase the firms sales volume, market share and profit. The government will also benefit from the fruits of this research since the improvement of the profit of firms will improve the nations economy.

1. SCOPE OF THE STUDY

In view of the numerous industries in the country and their location it become necessary that the research work on this issues be limited to only one key industry [ Limca bottling company Plc Okigwe which would represent a true sample of the industries in Nigeria]. It is on this basis therefore, that the various references made related to the sample used.

1. LIMITATION OF THE STUDY

A lot of constraints were encountered in an attempt to gather the necessary materials for the successful carrying out of the project. The following problems were encountered in the course of this research.

LACK MATERIAL: while carrying out this project research the work not been done on this particular subject this nearly made it impossible for to review past studies.
ECONOMIC FACTOR: due to the attitude of the personnel who suppose to give the necessary information for this study made me to spend more than necessary on transportation, then resort was made to vesting him whenever there is transportation fare.
FINANCIAL CONSTRAINTS: Inability to generate money made it impossible for me to carryout this research work effectively and efficiently.

1.9 EFINITION OF TERM

The value of a research work is incomplete unless the terms are defined in order to avoid some misconception or mi- interpretation that may arise.

MARKETING MIX

This involves all activities that the marketer uses in achieving the marketing objectives eg. Product, prices, promotion, place, people, physical evidence and process management.

PRODUCT DIFFERENTIATION

It is the decision of the management to produce two or more types of the same product, but differentiate in terms of styles, quality, packaging, size and colour.

SEGMENTATION

It is the act of dividing a market into meaningful group of buyers strategy.

Marketing strategy is a business activity, which treat each consumer uniquely.

PRODUCT STANDARDIZATION

It is a tool of market segmentation which treat the whole market equal by producing the sales standard of product for the entire market.

Is a group of interogeneous buyer who see different attribute in one product?

MARKETING

Is a management process for identifying and anticipating and satisfying customer’s requirement profitably?