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MARKETING COMMUNICATION AS A TOOL FOR EFFECTIVE MARKETING OF BANKING SERVICES IN NIGERIA

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TABLE OF CONTENT

Title page

Approval page

Dedication

Acknowledgment

Abstract

Table of content

CHAPETR ONE

1.0   INTRODUCTION 

1.1        Background of the study

1.2        Statement of problem

1.3        Objective of the study

1.4        Research Hypotheses

1.5        Significance of the study

1.6        Scope and limitation of the study

1.7       Definition of terms

1.8       Organization of the study

CHAPETR TWO

2.0   LITERATURE REVIEW

CHAPETR THREE

3.0        Research methodology

3.1    sources of data collection

3.3        Population of the study

3.4        Sampling and sampling distribution

3.5        Validation of research instrument

3.6        Method of data analysis

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS AND INTERPRETATION

4.1 Introductions

4.2 Data analysis

CHAPTER FIVE

5.1 Introduction

5.2 Summary

5.3 Conclusion

5.4 Recommendation

Appendix

 

 

 

 

 

 

 

 

 

Abstract

This study examined marketing communication as a tool for effective marketing of banking services in Nigeria. There are several marketing communication methods which may influence a company’s financial performance but this study focused on two aspects of marketing communication methods namely advertising and promotion. Advertising and promotion were chosen because following consolidation, banks have advertised more and various forms of promotion are being implemented. The study used chi-square statistics to examine the impact of marketing communication methods on financial performance in selected commercial banks in Nigeria.

 

CHAPTER ONE

                                        INTRODUCTION
1.1 Background of the study

Commercial bank as a component of Deposit Money Banks (DMBs) plays significant role of mobilizing savings from surplus sector to the deficit sectors in the economy with the aim of achieving the goals of profitability, liquidity and solvency. It is important to note that this function is critical to the success of any economy. And, in a bid to achieve these goals, considering the constraints imposed by the CBN regulations and the economic nature of the population of Nigeria which are characterized as 5.2% are fairly rich; 1.0% are rich; 69.2% are moderate; 2.7 % and 21.8% are very poor, Commercial Banks offer different financial services to individuals, firms, and governments like deposits, extension of credit facilities, safekeeping of valuables, agents of transfer of fund, business advisory services, business reports and references etc. it is important to emphasize that many of these services are also carried out by rivals institutions (formal and informal) like savings and loans institutions, cooperative societies etc. It is the belief of many writers that until the consumer derives final utility, there are really no products there are only raw materials. This is because the marketing view looks at business as directed towards the satisfaction of consumer wants (Jakada, 2006). Marketing is a major important activity within organizations because profits and survival of these organizations are inevitably tied to the satisfaction of consumer wants and needs. Marketing has become a major consideration in the present day service industry as a result of dynamism and competitiveness of the economy. Competition in this sector of the economy grows more intense and steadily more professional especially in the banking and other financial institutions. The age of specialization in the banking industry has changed to one where most organisations offer a wide range of services in competition with each other (Abdulqadir, 2010). It has, therefore become essential to use all the resources and techniques that marketing offers to survive and succeed in the ever changing business environment in the world with reference to our country Nigeria (Bale &Akpan, 2009). Thus marketing communication comes into consideration as it is intended both to communicate with and to sell to customers. At independence in 1960 there were 12 commercial banks in the country with 160 branches. (Ajibade,1984). Resulting from deregulation and liberalization in the Nigerian banking industry, the industry environment has changed in many ways. Before 1987, there was little or no competition because the governent restricted entry with the concentration of activities on the four largest banks (First Bank, United Bank for Africa, Union and International Bank for West Africa) (Redasel,1989, 1990). Later, developments in the economy witnessed series of business transactions and the emergence of banks became very desirable. The desirability aided the proliferation of many new banks and the rapid growth of existing ones. The number of banks grew from 45 in 1986 to 122 in 1992, comprising 67 commercial and 55 merchant banks. This was in addition to specialized banks like Peoples Bank, primary mortgage institutions, urban development banks, and non-bank financial institutions like finance houses, all of which were offering one specialized service, product or another. The market became more aggressive and competitive. This competition was further exacerbated by the emergence of finance houses, mortgage banks and community banks in the late 80’s and early 90’s, all competing for the same deposits in varying forms (Abdulqadir, 2010). Another phenomenon in the banking industry in Nigeria, which posed serious challenge to the sector is the issue of financial distress in the banks. As at March 1994, no fewer than 29 banks had been declared technically insolvent by the Central Bank of Nigeria (Isiaka, 2017). In 1997, interest rate deregulation was re-implemented while entry restriction was again relaxed in 1999 (Asogwa, 2004). The banking industry in Nigeria in January 2001 witnessed an important development – the introduction of Universal Banking. Universal Banking is a system of banking in which the operators licensed to undertake the business of banking are permitted to offer full-range of financial services. Thus banks simply become financial supermarkets. Removal of barriers to entry resulted in a rush into the domestic banking industry and thereby leading to increased competition (Hasheem, 2010). The banking industry therefore became very competitive. The armchair banking  of some years back gave way to aggressive competition in the industry. The increased emphasis of marketing in the banking industry became reinforced by the need to attract new customers and retain existing ones through efficient service delivery and customer satisfaction (Adeluyi, 2004). Faced with such challenges, the banks were forced to fashion out new survival strategies centered on aggressive marketing of their services, development of new services and improved efficiency in service delivery. It became evident that banks must, as a matter of necessity, provide inducements to their customers in order to retain the existing ones and make concerted efforts to attract new others. Some banks extended their marketing communications with the idea that customers should be made more aware of products and services they need, who might supply them and the benefits which both products, services and suppliers can offer. Marketing communications now need to move beyond the product information model and become an integral part of an organization’s overall communications and relationship management strategy (Groonroos, 2004).

1.2 STATEMENT OF THE PROBLEM

Marketing commination can be defined as all strategies, tactics and activities involved in getting the desired marketing message to intended target markets, regardless of the media use. Most service marketers have access to numerous forms of commination, referred to collectively as the marketing commination mix. The mix includes advertising, personal contact, publicity and public relations, sales promotion, instructional materials and corporate design (Lovelock and Wirtz, 2004). Banks are custodians of the customers’ wealth. They provide financial service; they provide peace of mind to the customer. As a result of this, banks marketing plans should ensure that the customer is well informed of its plans, problems and its solution to such problems. Marketing activities especially strategic marketing, therefore should almost be the main pre-occupation of any bank. It is against this backdrop that this study is embarked on.

1.3 OBJECTIVE OF THE STUDY

The main objective of this study is to examine marketing communication as an effective tool for marketing of banking service; but to aid the completion of the study, the researcher intend to achieve the following specific objectives;

  1. i) To examine the effect of marketing communication on customers patronage
  2. ii) To examine if there is any significant relationship between marketing communication and the financial performance of the banks

iii) To examine the role of marketing communication on customers loyalty

  1. iv) To examine the impact of marketing communication on return on investment of the banks

1.4 RESEARCH HYPOTHESES

The following research hypotheses were formulated to aid the completion of the study;

H0there is no significant relationship between marketing communication and the financial performance of the banks

H1there is a significant relationship between marketing communication and the financial performance of the banks

H0marketing communication does not play any significant role on customer’s loyalty

H2marketing communication does play a significant role on customer’s loyalty

1.5 SIGNIFICANCE OF THE STUDY

It is believed that at the completion of the study, the findings will be of great importance to the management of selected commercial banks as the study seek to explore the effectiveness marketing communication strategy as a means of marketing bank service, the study will also be of importance to the marketing managers of the selected commercial banks as the findings of the study will aid them in decision making and strategizing so as to get optimum result from the marketing team. The study will also be of importance to researcher who intend to embark on a study in a similar topic as the study will serve as a pathfinder to further research.  Finally, the study will be of importance to students, teachers, academia’s and the general public as the study will contribute to the pool of existing literature on the subject matter and also contribute to knowledge.

1.6 SCOPE AND LIMITATION OF THE STUDY

The scope of the study covers marketing communication as a tool for effective marketing of banking service in Nigeria. But in the cause of the study, there are some factors that limited the scope of the study;

 

(a)Availability of research material: The research material available to the researcher is insufficient thereby limiting the study.

(b)Time: The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.

(c)Finance: The finance available for the research work does not allow for wider coverage as resources are very limited as the researcher has other academic bills to cover.

1.7 OPERATIONAL DEFINITION OF TERMS

Marketing

Marketing is the business process of creating relationships with and satisfying customers. With its focus on the customer, marketing is one of the premier components of business management.

Communication

Communication is the act of conveying meanings from one entity or group to another through the use of mutually understood signs, symbols, and semiotic rules

Banks

A bank is a financial institution that accepts deposits from the public and creates credit. Lending activities can be performed either directly or indirectly through capital markets. Due to their importance in the financial stability of a country, banks are highly regulated in most countries.

Services

In economics, a service is a transaction in which no physical goods are transferred from the seller to the buyer. The benefits of such a service are held to be demonstrated by the buyer’s willingness to make the exchange

Commercial banks

A commercial bank is a type of bank that provides services such as accepting deposits, making business loans, and offering basic investment products that is operated as a business for profit.

1.8 ORGANIZATION OF THE 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), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study. Chapter two highlights the theoretical framework on which the study is 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.

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