USING MARKET PENETRATION STRATEGY TO IMPROVE MARKET SHARE OF MCN

MARKET PENETRATION STRATEGY TO IMPROVE MARKET SHARE OF MULTICHOICE, LAGOS, NIGERIA.

BY

AKINTOYE AFOLABI AKAMOH

Channels Development Unit

Plot 1381 Tiamiyu savage street, Victoria Island, Lagos. Nigeria.

([email protected]; +234-8141380841)

Dissertation submitted in partial fulfillment of the requirements for the degree

MASTER OF BUSINESS ADMINISTRATION

AT

BUSINESS SCHOOL NETHERLANDS.

Internal Examiner: Dr. Ayotunde Adebayo.

Set Advisor: Jide Ogunbanjo.

Set: Ikeja 10.

Submission Date: June 23, 2015.

DECLARATION OF AUTHENTICITY

I, Akintoye Afolabi Akamoh hereby declare that this dissertation is my personal work.

It is being submitted in partial fulfillment of the requirements for the degree Master of Business

Administration (MBA) to Business School Netherlands.

It has not been previously submitted for any degree or any examination at any other

University.

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ACKNOWLEDGEMENTS

Foremost, I give thanks to the Almighty God for making it possible for me to finish this MBA

dissertation work.

I will like to use this opportunity to thank my Parents, Mr. and Mrs. Akamoh and my lovely sisters

for their support and encouragement throughout this part of life journey and in the process of this

MBA programme and particularly in the course of writing this dissertation.

I will like to thank the entire staff of Multichoice Nigeria Limited (MCN) for their support and

cooperation in the process of carrying out this research work.

I will like to thank the entire BSN Nigeria team, most especially Mr. Lere Baale, Dr. Tunde Adebayo,

Mr. Jide Ogunbanjo and Morenike Adeyeye for their support and guidance throughout the MBA

programme and in the course of this dissertation. I am indeed grateful to you all.

Lastly, my sincere appreciation goes to IKeja 10 set for their support, contributions and motivation

towards the successful completion of this dissertation work.

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ABSTRACT

This study examined market penetration strategy as a growth strategy for improving the market

share of Multichoice Nigeria (MCN). MCN market share has been on the decline due to the

ineffective marketing strategy that neglects loyalty programs and marketing campaigns aimed at

broadening the distribution channels and improving the quality of the content to attract

competitor’s customers. The objectives of the study were to examine the marketing strategy

adopted by MCN, evaluate the drawbacks facing MCN in the implementation of the marketing

strategy and to identify the benefits of market penetration strategy in the Pay-Tv industry.

Descriptive Survey method of research was used, and primary data were obtained by the

utilization of a structured questionnaire, in-depth interviews were conducted and observations

were made with the aid of an observation checklist. The framework of the study was anchored on

the Ansoff growth matrix which suggests that companies can grow the business via existing and

new products, in existing and new markets. The sample size for the study was made up of 83

respondents who were top management staff, middle management staff and lower management

staff at MCN. A Stratified Sampling Technique was employed in the selection of the sample size.

Data obtained were analyzed by the use of Frequency Distribution Analytical method and the

results were represented using tables, charts, interview responses and observations were

transcribed. In agreement with the purpose of the study, deterministic decision-making matrix

model that enables the researcher to choose the most appropriate option out of the four probable

strategic options identified to improve the market share of MCN from the costs and benefits

perspective by using numeric criteria was used. The findings suggest that penetration strategy

that has the highest payoff with the lowest risk and cost be adopted to improve the market share

of MCN. The study also indicates that loyalty programs, effective distribution channels, free

preview and discount pricing strategy have a significant influence in attracting competitors’

customers. Therefore, it is recommended that relatively low-cost penetration strategy that ties

customers to products through a dialogue approach be implemented to improve the market share

of MCN. The findings from the research work revealed that MCN will not only retain its market

share and gain competitive advantage in a mature market like Pay-Tv industry through market

penetration strategy but attract competitors’ customers thereby improving its market share.

Keywords: Market Penetration, Market Share, Pricing Strategy, Competitive Advantage.

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TABLE OF CONTENT

Declaration----------------------------------------------------------------------------------------------------- II

Acknowledgement…………………………………………………………………………………III

Abstract…………………………………………………………………………………………….IV

Table of Content……………………………………………………………………………………V

List of figures/list of tables and annexures………………………………………………………..VIII

Acronyms ------------------------------------------------------------------------------------------------------.XI

CHAPTER ONE………………………….........……………….…………………………………...1

1.1 Background of study………………………………………………………………………1

1.2 Statement of problem……………………………………………………………………..14

1.3 Purpose of study…………………………………………………………………………..14

1.4 Objectives of the study …………………………………………………………………..14

1.5 Research questions…………………………………………………..…………….……...14

1.6 Theoretical framework……………………………………………………………………15

1.7 Significance of the study………………………………………………………….............16

1.8 Scope and limitation of the study……………………………………………….…..….....17

1.9 Research process………………………….………………................................................17

1.10 Definition of terms……………………………………………………..…………............18

1.11 Conclusion………………………………………………………………………………...19

CHAPTER TWO………..…………………………………………………………………………..20

2.1 Introduction………………………………………………………………………………..20

2.2 Theoretical framework ………………................................................................................20

2.3 Concept of marketing ……………………………...……..………….…………………....22

2.4 Elements of marketing.……………………………….……......…….................................23

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2.5 Forms of marketing………………….......………………………………………………...24

2.6 Competitive marketing strategy..........................…………………..……....………….….27

2.7 Market share.......................................................................................................................34

2.8 Market share change...........................……………....……………………………………35

2.9 Growth strategy…………………………..........................………………………………36

2.10 Relationship between growth strategy and market share………………………………...44

2.11 Market penetration strategy in Pay-Tv…...........................................................................46

2.12 Marketing strategies implemented by MCN…………………………..............................50

2.13 Summary of literature review........………………............................................................52

2.14 Conclusion.........................................................................................................................52

CHAPTER THREE……………..……………………………………………….…..……………53

3.1 Introduction…………………………………………………………………….……......53

3.2 Research design…………………………………………..…………………….………..53

3.3 Population of study………………………...………………………..……………….......54

3.4 Sample size and techniques……………………………………………………………...54

3.5 Research instruments……………………………………………………...…….…….…55

3.6 Validation of research instruments…………………………………………..........……...56

3.7 Reliability of research instrument..............…………………….....……………………...56

3.8 Procedure for administration of instrument....………………………………...……...….57

3.9 Statistical tools for data analysis.....…………….....……………………………………..57

3.10 Conclusion…………………………………………………………………………….….58

CHAPTER FOUR…………….…………………………………………………….......................59

4.1 Introduction……………………………………………………………………………….59

4.2 Presentation of respondents demographic data......….…………………….……..…….....59

4.3 Opinion of respondents on the research questions..….………………….…………….....64

4.4 Summary of findings from data analysis………….………………………………..…....85

4.5 Conclusion.........................................................................................................................86

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CHAPTER FIVE ……………………………………...……………….……………………….....87

5.1 Introduction………………………………………………………………………..…….87

5.2 Analysis of options………………………………………………………………….…...87

5.3 Selection and evaluation of options………..………………………………...………......95

5.4 Conclusion……………………………………………………………………….……....95

CHAPTER SIX…………………………………………………….……..……..…………………96

6.1 Introduction………………………………………………………………………………96

6.2 Conclusion.…………………………………………………………………………….....96

6.3 Implementation plan……………………………………………………..……………….97

6.4 Challenges and problems………………..……………………………………..…….......101

6.5 Input control measures.......................................................................................................102

6.6 Critical success factors.......................................................................................................103

6.7 Conclusion..........................................................................................................................104

CHAPTER SEVEN…………….………………………………………………..……………........105

BIBLOGRAPHY……………………………………………………………………….…………..107

APPENDICES.……………………………………………………………………..……....…........117

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List of Figures

1.1 MCN organogram…..……………………………..………………………………………….5

2.1 Ansoff growth matrix…………………………………………….………………………….16

2.2 Micheal porter’s generic strategy options………..............……………...............…………..28

2.3 Micheal porter’s five forces model….....................................................................................30

2.4 Approaches to market penetration strategy………………...........................…………….…39

2.5 BCG matrix……………………………………………………………………………........45

3.1 A chart showing gender respondents................…………………………….......…………..60

3.2 A chart showing qualification of respondents..............……………………………..………61

3.3 A chart showing respondents age...................................................................................……62

3.4 A chart showing Years of Experience....................................................................................63

List of Tables

1.1 SWOT analysis of MCN…………………………………................................................…9

1.2 Brand mapping of MCN………………………………………………………........………11

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1.3 MCN market Situation…………………………..…….........................…….....…………...12

3.1 Sampling distribution table...………………………………………......................……..…54

4.1 Gender distribution table………………………….................……………………………..59

4.2 Educational qualification…………………………………………….……………...............60

4.3 Respondents age distribution…………………………………………….................……….61

4.4 Years of experience in the organization.................................................................................63

4.5 Questionnaire item 5 response table.......................................................................................64





4.10 Questionnaire item 10 response table...................................................................................68








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5.1 Unweighted assessment option table......................................................................................94

5.2 Weighted assessment option table..........................................................................................94

6.1 Implementation plan table.......................................................................................................98

Appendix

Appendix I – MCN staff questionnaire…………………………………………………….........117

Appendix II – MCN staff interview guide…..……….…………………………………………..121

Appendix III – MCN observation checklist…..……….…………………………………………123

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ACRONYMS

IPTV: Internet Protocol Television.

DTT: Digital Terrestrial Television.

BCG: Boston Consulting Group.

PWYW: Pay What You Want.

DSTV: Digital Satellite Television.

DSD: Digital Satellite Decoder.

TV: Television.

BSN: Business School Netherlands.

MCN: Multichoice Nigeria Limited.

FTA: Free To Air.

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CHAPTER ONE

INTRODUCTION

1.1 Background to the Study

In the business world, growth is a crucial performance criterion and success scale for firms. Organizations

have traditionally emphasized either profitability or market share growth as their guiding orientations.

Armstrong and Kesten (2007: 116) noted that business performance and economic profit of the company can

be summarized in market share. One of the most important aims of businesses is to improve market share to

accomplish larger scale in operations and increase profitability. Although companies are sensitive to market

share, the factors that affect market share are still not clear (Armstrong and Kesten, 2007). Market share

retorts to elements of marketing strategy and two of the important items that influences market share is

marketing strategy and marketing mix. The capability to use the successful marketing tactics in market

competition is crucial for a firm’s performance (Slater, Hult, & Olson, 2010).

One of the primary objectives of marketing strategy is to enhance the long-term financial performance of a

firm. As such competitive marketing strategy serves to improve financial performance and market share of

the company through sustainable competitive advantages. Marketing strategy entails companies reacting to

situations of competitive market and forces of market or responding to environment forces and internal

forces to enable the firms achieve its objective in the target market (Lee & Griffith, 2004). Traditionally,

marketing strategy is a plan for pursuing the company’s goal or how the company is going to obtain its

marketing goals within a particular market segment (Kotler, 2010).

In the developing country like Nigeria, due to the powerful effect of competition, businesses develop by

initiating new products, adding additional values to existing products or acquiring new markets. Aderemi

(2003) observed that in Nigeria business environment, organizations are influenced by Intra-type

competition, competition among firms in the same type of business and Intertype competition, market

competition among firms in different kinds of activities but which sell the same product. Hence, sustaining

MBA DISSERTATION BY AKINTOYE AKAMOH (2015) –BSN NIGERIA.

1

the existence and advancing within the unpredictable competitive environment are possible for companies if

they can take the appropriate opportunities for them. Hence, the ability to successfully adopt competitive

marketing strategy is vital for a company’s profitability and market share performance.

Multichoice Nigeria (MCN) is a limited liability company registered in Nigeria, backed by the expertise of

holding company MIH and its parent company Naspers. MCN is one of the most prominent businesses in

the global MIH stable. MCN was founded two decades ago with the objective to provide television

broadcast service via digital satellite Pay-Tv service to interested subscribers. MCN enriches the lives of

customers through world-class Pay-Tv services, development of local production industries and dealerships.

MCN drives its sales majorly via the value chain management which comprises of channel partners such as

dealers, retailers and vendors (Moms and Pops).

The Researcher occupies the position of Channels Development District Manager for Lagos/Ogun regions.

The researcher works at the channel development unit, with the Channels Development Country Manager as

the immediate supervisor. The unit is responsible for accelerating business development and accreditation

growth of channel partners, who help drive sales. The researcher is entrusted with the responsibility of

channel development activities such as identifying new market opportunities and prospective entrepreneurs

that can trade the company’s products and provide services to new and existing customers.

MCN vision and mission.

VISION – To be Africa’s first choice and leading Pay entertainment destination anytime, anywhere.

MISSION – To own and manage interactive platforms that bring digital media entertainment, content and

services to multiple devices, for which users pay a monthly subscription

(www.multichoice.co.za/multichoice/action/media/downloadFile?media_fileid=105 accessed on 20 th May,

2015).

Products and services


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MCN owns the following exciting brands:

DSTV (provides Digital Satellite Television service)

Mnet (delivers thematic channels and exclusive contents to DSTV subscribers)

Supersport (provides comprehensive coverage of both local and global sports contents)

DSTV Media Sales (commercial airtime sales and air sponsorship)

DSTV Mobile (provides mobile television contents and services)

DSTV online (delivering entertainment content and services from the MCN family to customers via

breakthrough technologies).

GOTV (provides Digital Terrestrial Television service)

Services offered include;

1. Promoting pay television Services.

2. Entering into a contract negotiation with various content providers, ensuring excellent packaging of

best contents in our different bouquets for MCN subscribers.

3. Providing programmed guide (both printed and electronic) to subscribers.

4. Operating a subscriber care call center.

5. Receiving subscriber payments and managing subscriber’s accounts.

6. Coordinating the supply, sales and servicing of decoders for subscribers mainly via the value chain.

7. Conducting in – depth market research.

The market situation of today has changed such that the customers have taken control of the market. The

customers determine the product and service they require which shall be fulfilled by the producer/service

provider. The number of products in Pay-Tv market not only increases the number of competitors, but also

creates variation in competition. Any Pay-Tv company expecting to win this competition should provide the

best quality at affordable price, easy access to the products and at the same time, establishing closeness with


3

customer by recognizing the people who are being served and finding out the types of products and services

they require. The way of marketing in Pay-Tv has undergone a substantial change for the last three decades.

With the emergence of new high-capacity platforms such as digital terrestrial television (DTT), Internet

Protocol TV (IPTV) and wireless broadband, there is definite potential for greater competition in Pay-Tv

markets, which in theory should stimulate innovation and produce greater economic efficiency and

improved consumer welfare. Hence, technological abundance has opened the door for new entrants. Selling

products is not enough nowadays; retaining customers is the prevailing phenomenon of the 21st century

marketing strategy. Successful companies have already moved from the obsession of selling product to the

philosophy of customer service. Organizations have also traditionally emphasized either profitability or

market share (growth) as their guiding orientations. As the fundamental responsibility of any organization is

to maximize shareholder value, such an orientation should be done along with a very high emphasis on

products. Consumer behavior in buying products have changed significantly in recent years, and further with

increasing competition and market saturation, the Pay-Tv industry has become very competitive.

CORE VALUES OF MCN

The following are core values of MCN:

INTEGRITY

MUTUAL RESPECT

OWNERSHIP AND ACCOUNTABILITY

INNOVATION

TEAMWORK

CUSTOMER FOCUS


4

LEGEND

Fig. 1.1: MCN ORGANOGRAM

Source: Adapted from MCN HR Manual Workbook.


5

DSTV GOTV MULTICHOICE

ANALYSIS OF MCN MARKETING UNIT.

Firms seek competitive advantage and synergy through a well-integrated program of marketing

mix elements (Walker, 2011). Brodrechtova (2008) explained that marketing strategy is a

roadmap of how a firm assigns its resources and relates to its environment and achieves a

corporate objective in order to generate economic value and keep the business ahead of its

competitors. The marketing strategies have a significant impact on the efficiency and cost

structure of an enterprise. Hence, Marketing activities of MCN include promotions, brand

management, public relations, market research and market survey. The division is made up of

three units; DSTV marketing unit, GOTV marketing unit and corporate communications unit.

According to Kolter (2005), Marketing mix is a combination of tools, grouped into four

categories (4P’s), implemented by the companies to achieve the business goals of the market.

Additionally, People, as the 5th P, can be added in the case of businesses offering services. The

Marketing mix of MCN is as the following:

Product: A product could be seen as anything that we bring to a market to satisfy a need. Lee

and Griffith, (2004) noted that better firm performance can be obtained by adapting the product to

meet requirements of customers. MCN offers Pay-Tv services as explained earlier. The MCN

product development team offer innovative products that bring families together with the aid of

quality entertainment contents which are viewed via the devices such as DSTV mobile (television

on the go), GOTV decoder (plug and play device), DSTV decoder (Direct to Home)and DSTV

catch up (Online Series). The MCN product development team designs these innovative products,

according to customers’ needs and target market niche.


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Price: Lages & Montgomery (2005) noted that price is one of the most important items in market

share increasing. In organizations, the requirement of the right price has become an important

matter because the price might ultimately influence whether the buyer decides to buy a particular

product or not. In MCN price ranges are quite justifiable for the target market niche, which

allows consumers get value for their money. MCN has designed reasonable subscription rates to

suit consumer’s pocket, thereby creating a market niche for both high and low-income earners to

enjoy quality entertainment contents. However, Eusebio (2007) emphasized that price is not only

the dominant strategy for companies in the market rather that low-cost advantage had a positive

relation with a share market.

Place: In a competitive environment where there is the similarity of services, the place strategy is

a good strategy for differentiation (Griffith, 2004). This aspect looks at the distribution channels

for the organization’s products and services. The process ensures products and services are

readily available in all regions thereby making products and services easily accessible to final

consumers. Currently in MCN, there are about 477 Channel outlets (dealer and retailer outlets)

with 11 MCN branches nationwide for a wide coverage to service subscribers. The network of

channel outlets and branches expands as the business grows; MCN provides convenient and

conducive channel outlets nationwide for clients to experience one-stop quality service without

the stress of traveling long distances to get our products or services.

Promotion: The importance of promotion is recognized from higher sales of firms that used

sound advertising. Firms which have a greater commitment to their target market use higher level


7

of publicity rather than firms who have less responsibility that used low level of publicity (Lee &

Griffith, 2004). A good product, an attractive price and a good distribution channel are not good

enough if an organization wants to be a frontline player in its line of business. The organization

must communicate with its present and future clients. For these products to be sold correctly, the

consumers have to be well informed. The message or information that is passed across must be

clear concise to the potential clients. The message is to convince the consumer that the offer is the

most attractive as well as motivate the customer to carry out the desired act, which is purchasing

the product. In MCN, we channel our promotions via several mediums such as social media, print

media, TV and radio jingles, direct marketing (sending bulk SMS and emails) and also selling via

full branded personnel’s (canvasser) to ensure clients are drawn to the product which helps to

yield sales.

Personnel: These are employees that must sell and support the products for the organization, it is

expected that each staff works with specific targets. These targets are to be based on the company

and the market position that the business desires. Personnel’s in MCN are chosen based on

proficiency and are regularly trained to deliver at all times. Personnel works as a team and are

given targets to achieve the company’s goal. Staff incentives are reviewed once they meet their

target to encourage them to do more.

MCN SWOT ANALYSIS

SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats) is a strategic evaluation

tool that marketers use for assessing the strategic organizational position. The main purpose of

SWOT is to provide meaningful insights to marketers about organizational key competencies


8

after evaluating data gathered through marketing intelligence and to enable them in making best

use of that data in utilizing opportunities, linking those with organization’s strengths, identifying

major threats, and minimizing weaknesses (Nasri, 2011). The best strategy is one that fits

organization's strengths to opportunities in the environment. SWOT analysis is a way of assessing

the organization’s current capabilities. Benchmarking systematically compares performance

measures such as efficiency, effectiveness or outcomes of an organization. It is by evaluating the

organization’s current capabilities with other organizations that can help identify a gap. In this

way, the organization can adapt to the best practices to improve organizational performance

(Bose, 2008).

Table 1.1: TABLE SHOWING THE SWOT ANALYSIS OF MCN.

STRENGTHS WEAKNESS

Effective supply/distribution network.

Early penetration into the market. Certified International and local

TV content. Continuous innovation e.g. DSTV

mobile that allows you watch TV on the go.

Flexible and reasonable subscription plan.

Reliable value chain that has a wide coverage of channel partners nationwide.

Strong value proposition. Strong intellectual base of staff. Exclusivity on foreign content such

as English Premiership League.

The high purchase price for the hardware with additional monthly subscription fees.

Only offers a television subscription without data service.

Poor turnaround time which hinders quality service delivery.

Inadequate transmitters which limits signal coverage.

Lack of proper managerial skill amongst technical supervisors /managers.

Delay in project implementation Lack of strong competitive

strategy. 30% market share.

OPPORTUNITIES THREATS


9

Low penetration in the rural areas. Growing population. High demand for digital services. Government backing with Digital

migration in 2015, where no one can view any TV content without a decoder.

Value chain expansion, thereby accrediting new channel partners to join the value chain.

Possible increase in subscriber’s base from other distressed Pay-TVs.

Intense competition. Increasing regulatory controls. Piracy. Price war. Lack of basic infrastructure such

as power supply, good roads, security etc.

Multiple Taxation. Effects of Xenophobic attacks.

Source: Adapted from Akamoh, Organizational Analysis of MCN, 2014.

The most important conclusions that can be made of the MCN SWOT analysis is that it shows

that there are lots of opportunities. MCN’s strengths demonstrate that the company has a reliable

product that offers lots of benefits for the consumer. This combined with the opportunities;

provide strong points that can encourage further growth. The most important strong point that can

be built on and realize further growth is that there is a high demand for digital services thereby

presenting the opportunity for interactive options combined with Smart/Connected televisions.

This proof useful, due to the growing consumers with connected televisions, increasing Internet

access speeds, growing the broadband access market and increasing IPTV subscribers. Also, with

young consumers becoming increasingly connected and technologically savvy, form active and

significant opportunity that can be seized to achieve further growth.

However, MCN marketing strategy is not competitive enough to retain or gain market share from

the competitors in the Pay-Tv industry. Presented below is the brand mapping showing the


10

current marketing strategy of Multichoice Nigeria and where the company aims to be vis-a-vis

other companies in the Pay-Tv industry in Nigeria.

Table 1.2: Brand mapping vis-à-vis other Pay-TVs in the industry.

Elements of marketing

strategies (brand

differentiators).

MCN STAR TIME CONSAT

Service and Support

(personnel)

7 9 6

Communication with the

customer (promotion)

7 8 3

Product Price 7 9 4

Product Development 8 8 5

Speed of Delivery

(distribution network)

6 9 6

MARKET SHARE 30% 50% 20%

Source: Survey data, 2015.

From the researcher’s observation based on the experience in the industry, the above table

indicates the elements of marketing strategy employed by MCN which includes service and

support, communication with the customer, product price, product development and speed of


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delivery allocating 10 to the highest standard and 1 to the least standard. Hence, the table reveals

that the marketing strategy of MCN is poor compared to other Pay-TVs in the industry.

Furthermore, in Multichoice Nigeria Limited (MCN) the identified opportunities have not been

harnessed as there is lack of well-conceived marketing strategies and campaigns that push brands

forward in the consciousness of audience and lead to lasting adoption, advocacy and, over time,

increase expectation of the company. Besides, there is no workable customer loyalty program that

is aimed at rewarding loyal customers. Loyalty programs are designed to develop and maintain

customer relationships over a sustained period by rewarding them for every interaction with the

brand. Ineffective loyalty programs have resulted in the loss of market share to competitors. For

example, a new product launch in MCN is most times without any great budget aiming to make

the product become a household name within a few weeks of the strategy implementation. A

situation like this renders marketing strategy unrealistic regardless of the proposition of the

marketing campaign. Secondly, an established brand lacks a good idea of its audience through

traditional marketing efforts in practice at MCN. One of the benefits of market penetration

strategy is the opportunity to segment activity into different spheres and places directly targeted

to the location of the audience. Targeting activities in this way can be used to reduce cost while

increasing efficiency and message for each of the channels based at these locations. Also,

monologue marketing strategy at MCN instead of dialogue approach does not engage audiences

directly. All of these lapses result in the consistent decline of the company’s market share. Hence,

there has been a steady drop in MCN market share from 2011 to 2014 which points to the fact

that there is an underlying problem beyond the marketing aspect of the business. Below is a table

showing the market situation figures from 2011 to 2014.


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Table 1.3: TABLE SHOWING MCN MARKET SITUATION

YEAR SALES

Customers Serviced

Industry Sales Forecast

Market Share

(Million) (Million) ( Million) In percentage

2011 11.6 1.2 33 35%

2012 11.4 2.6 33.8 34%

2013 11 3 34.5 32%

2014 10.5 3.2 35 30%

Source: MCN Sales Record, 2011-2014.

Note: Market Share = Annual Sales/Industry Sales forecast*100

As seen from the table 1.3 above, the company’s present market share in 2014 was in decline as

compared to previous years. The reduction in market share is therefore, a major challenge for the

organization which requires growth strategy to improve market share.

Successfully executing customer centricity strategy means clearly differentiating brand on the

basis of product assortment, price range, information availability, service, as well as the

personalized promotional offer. Ability to consistently deliver the best all-around value and most

satisfying experience for customers depends on the ability to deeply understand the customers. In

a world of many choices, stretched budgets, and too little time, it becomes imperative that MCN

makes customers believe that the brand offered is the single most convenient, efficient, pleasant

way to acquire what they want at an acceptable price. Unless customers understand that the brand

offered by MCN is uniquely able to consistently deliver results, the goodwill won through

personalized engagement can fade quickly. This study therefore, examines market penetration

strategy as a means of improving consistently declining market share of MCN.


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1.2 Statement of the problem

MCN market share has been on the decline due to the ineffective marketing strategy that neglects

loyalty programs and marketing campaigns aimed at broadening the distribution channel and

improving the quality of the content to attract competitor’s customers.

1.3 Purpose of the study

The purpose of this study is to identify effective market penetration strategy and provide tactical

actions to the improve market share of MCN.

1.4 Objectives of the study

The objectives of this study are to:

1. Obtain the socio-demographic data of employees in MCN.

2. Examine the marketing strategy that is adopted by MCN.

3. Evaluate the drawbacks facing MCN in the implementation of the marketing strategy.

4. Examine the approaches to market penetration strategy in the MCN.

5. Identify the benefits of market penetration strategy in the Pay-Tv industry.

1.5 Research questions


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From the objectives of the study, the following are the research questions:

1. What are the socio-demographic data of employees in MCN?

2. What is the marketing strategy that is adopted in MCN?

3. What are the challenges that hinder increase in market share in MCN?

4. What are the approaches to market penetration strategy that can be adopted in MCN?

5. What are the benefits of market penetration strategy in the Pay-Tv industry?

1.6 Theoretical framework

This study is grounded on Ansoff (1987) Growth Matrix, which was created by Igor Ansoff,

American Planning Expert. Ansoff Matrix is a strategic planning tool that links an organization’s

marketing strategy with its general strategic direction. This matrix represents four alternative

growth strategies namely market penetration, product development, market development and

diversification. For the purpose of this study, market penetration entails selling existing products

or services to existing markets to achieve growth in market share. In addition, Kotler, Keller,

Brady, Goodman and Hansen’s (2009) four approaches to market penetration namely: increase in

market share, dominating growth market, driving out competitors and increase in existing

customer usage are integrated into the framework. This study examines MCN marketing strategy

in relation with Ansoff Matrix model to establish standards upon which effective market

penetration strategy is adopted. Presented below is Ansoff Growth Matrix:

Fig. 2.1: Ansoff growth matrix


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Source: Adapted from Corporate Strategy. (Ansoff, 1998).

1.7 Significance of the study

The study seeks to improve market share in Multichoice Nigeria limited using market penetration

strategy. Moreover, the study will be useful to Business Development Managers, marketing and

field executives, students, practitioners, marketing consultants and academics etc. For instance,

Business Development Managers in the industry would find this research work very relevant by

having a clear understanding of conditions necessary for application of market penetration

strategy. It shall also provide them with a framework within which they can evaluate the best

marketing strategy.

The findings in this study would assists marketing executive in developing appropriate marketing

tactics to adopt while out in the field. To the Marketing Research Experts/Consultants findings in

this research work serves as an important source of knowledge that is capable of assisting them in


16

providing qualitative consultancy services as it will provide them with various ideas on issues

concerning marketing strategies and market share gains.

To the Advertising / Public Relations Practitioners, this research shall expose this category of

stakeholders to other generic strategic options to enhance growth.

1.8 Scope and limitation of the study

Every research work is only effective and useful at drawing reliable conclusions if it concentrates

on its objectives. This study will be limited to market penetration strategy as an approach to

improving market share in MCN. Respondents to the study will be restricted to the Top

management staff, Middle management staff and Lower management staff in the marketing

department of MCN. This is because the Top management staff, Middle management staff and

Lower management staff have immeasurable experience in the marketing of company’s products.

In addition, there are few constraints that are envisaged in the course of this study. These

constraints are difficulties in gaining the respondents audience in the process of administering

questionnaire and interviews. Also, the results of this study cannot be generalized to the entire

Pay-Tv industry because the research is only limited to Top management staff, Middle

management staff and Lower management staff of MCN.

1.9 Research process

The research instrument used for this research is a combination of observation checklist, in-depth

interviews and structured questionnaires (Triangulation). A stratified sampling technique is to be

adopted in choosing the respondents. The sample size will be calculated using a sample size


17

calculator from www.surverysystem.com/sscalc.htm. Questionnaire items will be mapped to

research questions and research objectives to validate content. In order to ensure instrument

reliability and scale validity, the questionnaire items and its scale will be checked and moderated,

a pilot study will be held using a few members of the identified sample size which will be

supervised by the internal examiner.

1.10 Definition of terms

Marketing strategy: It is the goal of increasing sales and achieving a sustainable competitive

advantage.

Market penetration: This is the activity of increasing the market share of an existing product, or

promoting a new product, via strategies such as volume discounts, lower prices, advertising and

bundling.

Market share: This is a measure of the percentage of sales volume of an existing product or

business achieves in relation to the competition.

Growth strategy: Tactic used in marketing management to expand the consumer market for a

company’s product.


18

1.11 Conclusion

This chapter, having examined the market situation of MCN vis-a-vis other Pay-TVs and clarified

the need for MCN to improve its market share which is on the decline as revealed above, the next

chapter (chapter two) shall review marketing strategy with emphasis on penetration strategy to

improve market share. Subsequent chapters (chapters three and four) will focus on the methods that

are used to collect and analyze data for the study, analysis of the questionnaire items and

interviews, evaluation and presentation of results. In chapter five of this study, the findings will be

used to generate options from a cost and benefit perspective and implement the best optimal

strategy option using deterministic decision matrix model that will address the consistent market

share decline in MCN. The implementation of the preferred strategy option and the conclusion of

the study will be presented in chapter six. Finally, chapter seven of this study will dwell on the

researcher’s reflection of the entire research process.


19

CHAPTER TWO

LITERATURE REVIEW

2.1 Introduction

The aim of this chapter is to review market penetration strategy regarding some relevant theories

(http://www.eric.ed.gov/?id=ED304830/ accessed on 18th June, 2015). Emphasis will be on the

Independent Variable (market penetration strategy) and Dependent Variable (market share) with

the aim of identifying standards, against which current conditions can be compared

(http://www.interesjournals.org/full-articles/evaluation-of-reading-proficiency-of-learners-with-

low-vision-while-using-low-vision-devices.pdf?view=inline/ accessed on 18th June, 2015). The

researcher made use of several scholarly materials searched from the EBSCO website and other

appropriate origins of information like articles, books and thesis from various authors and

scholars that are experienced in the area of marketing strategy and pricing strategy as an effective

way to improve market share. For the purpose of this study, this chapter discussed Ansoff’s

Growth Matrix model, the concept of marketing strategy, market share, market penetration and

dimensions, market development among other relevant sub-topics relevant to the research topic.

2.2 Theoretical framework

The framework of this study is based on the Growth Matrix by Ansoff (1987) which suggests that

companies can grow the business via existing and new products, in existing and new markets.

Ansoff presented a corporate growth strategy matrix that focused on the firm’s present and

potential products and markets. By considering methods to develop via current products and new

products, and in current markets and new markets


20

(http://www.quickmba.com/strategy/matrix/ansoff/ accessed on 18th June, 2015), there are four

probable product-market combinations; market penetration, market development, product

development and diversification (Ansoff, 1987). According to Drucker (1974) in Hollensen

(2007), growth will continue to be a desirable and indeed a necessary business objective. Indeed,

a company that does not grow will decline. Thus, there is even more need for a strategy that

enables management to plan for growth and to manage growth. Drucker (1974) stated that it is

not enough for management to say ‘‘we want growth’’, Management needs a rational growth

policy with both minimum and optimum objectives.

The strategy is important in practice. Decisions are clearly strategic and crucial to the growth of

the organization, have a broad scope, create added value, and have consequences for many jobs

and activities within the organization. The strategy is always built on knowledge of the actual

strength and weaknesses of an organization. The strategy should set out a general course, a

perspective for the longer term. It serves as a compass, a tool for sense making in the longer term

(Pearce, Robinson & Mital, 2010). Growth strategy is a multi-faceted phenomenon that is usually

related to firm survival, accomplishment of business goals and success or the scaling up of

accomplishments (Storey, 1994). Thompson and Strickland (2003) stated that developing the

business can be taken to mean creating and employing strategies that will bring revenue to the

business, appealing and pleasing customers, competing successfully with other contenders in the

industry, conducting operations and increasing the company’s financial and market performance

(http://business.uonbi.ac.ke/sites/default/files/chss/business/business/CHALLENGES%20OF

%20IMPLEMENTATION%20OF%20GROWTH%20STRATEGIES%20AT%20THE

%20UNIVERSITY%20OF%20NAIROBI.pdf/ accessed on 18th June, 2015).

Crosby (2012:12) characterized the strategies in Ansoff matrix in terms of risks. He defined

market penetration strategy as “least risk”, market and production growth strategy as “moderate


21

risk” and diversification strategy as “high risk”. See Fig 2.1 for Ansoff Growth Matrix

illustration.

Ansoff Growth Matrix provides a valuable means of identifying the scope and direction for

strategic development at the business level.

2.3 Concept of marketing strategy

According to Rajan (2010), marketing strategy refers to an organization’s incorporated pattern

of decisions that specify its critical choices regarding markets to serve and market segments to

target, marketing activities to accomplish and the method of performance of these activities, and

the apportionment of marketing resources among markets, market segments and marketing

activities toward the establishment, communication and/or delivery of a product that provides

value to customers in exchange with the organization and thereby empowers the organization to

accomplish specific goals. Hence, organizations are faced with the need to address issues relating

to “how to compete” on an on-going basis.

According to Benjamin, (2002) marketing strategy in communication consists of “the continuous

sharing of information concepts and meanings by the source and the receiver about the products

and services and the organizations that sells them" David and Nagel, (2001) on the other hand

argued that "it is the term indicating description or relevant communication techniques used for a

marketing purpose in a long and continuous term".

Marketing strategy in communication has also been explained based on promotional activities.

The main objectives of communication networks are to inform and persuade their existing and

prospective customers. There is a saying that customers must recognize that a product exists;


22

otherwise they may not comprehend how the product can meet their needs. Therefore, the first

aim of communication in marketing is to disseminate information to create a strong awareness of

their services and products. However, customers may decline to make an exchange because they

will want to be guaranteed that the product can fulfill their needs. Henceforth, some coaxing is

required to reassure the consumers to purchase these products.

Strategic marketing involves critical decision-makings that will determine the sales growth of the

organization, to strengthen the profitability of the organization through an enhanced sales force

and effective business operations. Although several scholars have attempted to explain successes

and failures of strategic marketing in advanced educational institutions, scholars disagree in their

opinions. As a result, there is no accord on major elements of strategic marketing’s success.

However, Aaker (2004) suggested that critical decision-making that influences sales growth of

the organization involves a set of interrelated elements of marketing strategy.

2.4 Elements of marketing strategy

Marketing strategy is made of several interrelated elements. The first and most vital is the market

selection (Brown, & Sommers, 1982 in Aaker, 2004) which is directly linked to selecting the

markets to be served. Product planning involves the exact products the company sells, the

makeup of the product line, and the design of distinct offerings in the line. Another element is the

distribution system: the wholesale and retail channels through which the product travels to the

people who eventually buy it and use it. The general communications plan uses advertising to tell

probable customers about the product through radio, television, direct mail, and public print and

personal selling to organize a sales force to call on prospective consumers, urge them to purchase,

and take orders. Finally, pricing, is a vital element of any marketing program and is one of the

most focused marketing elements in the establishment of value for shareholders (Doyle, 2000).


23

The company must set the product prices that different classes of consumers will pay and control

the margins or commissions to reimburse agents, wholesalers, and retailers for conveying the

product to final users. Kotler (2003) explained that the concept of marketing strategy extensively

embraces marketing mix elements, which consists of product, price, distribution and promotion

referred to as forms of marketing strategy.

2.5 Forms of marketing strategy

1. Pricing strategy

Although customers are not always aware of the exact prices of products, price making in

marketing plays a vital role in the final sale of a product. Involved in the many facets of

making pricing decisions are various forces – the pricing organization, costs, demand, legal

factors, both the firm’s objectives and the personal objectives of the executives making such

decisions (Bryson, 2004).

Pricing policies are set at the top, but the tendency is for large companies to allow the various

divisions to set prices. However, price making must be made with the objectives of the firm

clearly in mind. Sometimes the personal goals of executives may conflict with the overall

company objectives. Businessmen set prices based on their judgment of demand. Pricing in

most areas of business is company controlled and not market controlled completely by supply

and demand. Thus, a firm is free to charge a penny or more per product because of some

differentiating factor, whereas in a purely competitive market the price is set by market forces

(Brentani, 2006). The determinants of demand are usually considered to be the price of the

product, the number of customers, the preferences of these customers, the level of family

income, and the competitive products available. In determining the price of a product, Kotler


24

(2009) noted that one must consider whether the demand is elastic or inelastic. Demand is not

the only consideration in determining price; a firm must also consider the role of supply,

which is governed by the costs of manufacturing and distributing a product.

In addition, Klaus, Martin and Robert (2014) lead a study on Pay What You Want (PWYW) as a

Marketing Strategy in a Competitive Market and establish that PWYW can be attractive for

companies that want to make best use of unit sales. Klaus et al. (2014) suggested that PWYW can

be used as a competitive strategy. PWYW successfully destabilizes all contending sellers using

posted prices and thus threatens to push them out of the market. Moreover, when only PWYW

sellers remain in the market, the rivalry is lenient because sellers do not, by definition, contend on

price. On the other hand, contending sellers using posted prices could negatively affect the

profitability of PWYW. These posted prices could form superior bound on the prices that

consumers are willing to pay freely (Gneezy, Nelson, Brown, 2010). Pricing strategy also appeals

to vendors who want to promote a complementary product, principally if the (traditional) sale of

the complementary product is highly lucrative. For example, for the British rock band Radio

Head, some debate that proposing its album “Rainbows” on the internet by using the PWYW

mechanism melodramatically enhanced the popularity of the album and thereby improved the

revenues from the (traditional) sale of the Compact Disc (CD) and the concert tour. Also,

exploiting sales may appeal to a vendor who wants to enter a new market, examine the new

product, generate network effects, or comprehend learning-by-doing effects.

PWYW seems to be the best strategy for maximizing market penetration. Of course, one can also

achieve utmost market penetration by merely giving away the product for free. In fact, this is

what lots of companies do (Klaus, Martin, Robert, 2014). The advantage of PWYW is that it

makes the product available to every class of the economy free of charge, but it also generates

positive revenues if some buyers pay positive prices voluntarily.

2. Promotion strategy (communicating with the customer)


25

All the efforts put forth by a company to communicate its product and service to the public are

called Promotion, Promotion includes advertising, personal selling, publicity and other activities

that are loosely referred to as involving sales promotion. The latter includes such activities as

store display, trade show exhibits, contests and other similar activities.

Firms vary in the usage of each promotional technique. As a general rule, when the product is

non-technical, firms tend to spend more on advertising. In firms where the cost of contacting an

individual customer is high and the potential return to the company is also high, the firm would

tend to rely on personal selling (Bone and Kurty, 2012). One of the problems with promotional

activities is that it is difficult to measure or estimate their future impact. To overcome this,

many firms rely on experiments and testing. Advertising does not guarantee success nor does it

indicate that a firm will eventually monopolize an industry. It is, however, a major means used

by most firms to communicate with their markets. One of the most important parts of the firm's

total mix is the planned strategy that goes into the firm’s means of communicating its products

and services to the consumer. All these efforts are called Promotion.

3. Distribution strategy

Physical distribution in marketing is concerned with the movement of the manufacturer’s goods

to the place where they can be sold to the final seller or directly to the consumer. One aspect of

physical distribution is the logistics problems connected with the sale, that is, the most profitable

mode of transportation to the place or person of sale. At one period of time the physical

distribution function was only the concern of those interested in cost-cutting procedures in

shipping both finished goods and raw materials from one place to another, without any direct

relationship with the marketing departments. In recent years, however, a change in attitude has

occurred that has integrated the distribution of the product with the marketing mix. In effect, the

physical distribution mix is an integral part of the total marketing mix and stand on the side of

promotion, pricing, and the product with equal status (Adeleye, 2003).


26

Also to the marketing strategies mentioned above, Kotler and Keller (2012) suggested that for

any organization to out-perform competitors in the same industry, such organization must adopt

competitive marketing strategies.

2.6 Competitive marketing strategies

According to Kotler and Keller (2012), competitive advantage can be defined as an organization’s

capability to perform in one or more methods that competitors cannot and will not match. Haag

and Cumming (2013) understands competitive advantage as the act of offering a product or

service in a manner that consumers value it more than what other competitors can offer (Haag and

Cummings, 2013: 19). Competitive advantage can also be understood as accomplishments that

create superiority value over competitors and can be gained by providing customers better values

than other contenders such as providing quality services, providing lower prices and other

benefits that validates higher price.

Generic competitive strategies proposed by Michael Porter (1980:34) suggested three potentially

successful approaches to outshine other firms in an industry. These approaches include:

1. Overall cost leadership

2. Differentiation

3. Focus


27

Fig. 2.2: Micheal porter’s generic strategy options

Source: http://www.2012books.lardbuckets.org/ accessed on 20th March, 2015.

These strategies are defined as generic because they can be adopted by several businesses within

the same industry or strategic group. However, if several businesses espouse alike strategies, built

on the same elements, they may become parallel and compromise the viability of all of the

businesses, changing the price into the key factor in the purchase.

Overall cost: The strategy here is to achieve the lowest of production and distribution so that it

can afford to price lower than the competitors thus winning a larger market share. Overall cost

leadership requires that a firm be in the position of being the lowest cost producer in its

competitive environment to offer its product or service at a lower price than its competitors.

Differentiation: In differentiation, the firm’s repute as a quality or technology trailblazer,

resilient cooperation from channels, superb marketing skills, product engineering and basic


28

research are crucial (Porter, 1980). Differentiation entails firm building a particular brand image

that differentiates itself from its competitors.

Focus: This approach on one (or few) segment(s) allows the firm to concentrate its action and

choose the approach of differentiation, cost leadership or a combination of both, for such

segment(s).

Thus, the business can better serve consumers that were not properly served by businesses in the

broad market. Achumba (2000) however added that focus imposes some limitations on the

achievable market share as it involves a trade-off between profitability and sales volume.

Whereas cost strategy requires skills in monitoring the raw materials, power, components, labor,

machinery or storage space, as well as a huge investment in training to help decrease the costs of

scrap and reworking, product differentiation requires a irrefutable skill that predisposes a business

to a deeper understanding of its consumers’ requirements than could be done by its contenders

(Bowman, 1990). A product differentiation strategy thus requires a great degree of capability in a

wide area of management, organization and labor force that is greatly trained, experienced, self-

motivated and able to work together as a team. People are the main resource in this organization

and are thus expensive. Although cost leadership requires extensive effort to increase the

efficiency of the business, the quality of the products or services carries greater emphasis under a

differentiation strategy.

In addition to Porter’s generic strategy options for gaining market share in a competitive market,

there are five forces that shape the competitive ability of a firm in every industry (Porter, 1998 in

Riley, 2012).


29

Fig. 2.3: Micheal porter’s five forces model

Source: Adapted from Five Competitive Forces That Shape Strategy. M.E. Porter, 1985. (Harvard

Business Review, 2008).

The threat of entrance by prospective new competitors

The threat of new entrants refers to the probability that the returns of established companies in the

industry may be eroded by new contenders. The magnitude of the threat depends on current


30

barriers to entry and the combined reactions from current contenders. If entry barriers are high or

the new-comer anticipates a sharp retaliation from established competitors (Porter, 1998), the

threat of entry becomes low. The circumstances discourage new competitors. The major barriers

to new entries are many including patents and brand identification (Bateman & Snell, 2004).

The case of Pay-Tv

In Pay-Tv industry, first to enter the television market, start-up costs is needed. Developing

technology is expensive and takes time. Established Pay-Tv already has the technology that is

new and different than the regular IPTV providers. Pay-Tv technology is also difficult to copy.

There are economic scale benefits for major television providers. The benefits are in distribution,

content delivery, purchasing hardware. Competitors will protect their market shares by trying to

compete with new Pay-Tv. Also, consumers have to purchase new hardware when switching to a

new competitor in the industry. All these pose barriers to new entrants in the industry.

Bargaining power of buyers

Buyers may threaten an industry by forcing down prices, bargaining for higher quality or more

services and playing competitors against each other. This consequently reduces profitability. The

power of each buyer group depends on the attributes of the market situation and the significance

of purchases from that group compared with the overall business (Alkhafaji, 2003).

The case of Pay-Tv

Buyers are not concentrated and, therefore, have a positive impact on the television industry. Pay-

Tv offers the consumers lots of innovative and extra options that are different than the


31

competitors. Products that are being offered by the competitors do not differ a lot from each other

and are usually the same offering a few new services.

Bargaining power of suppliers

Suppliers can pressurize an industry through price increments or quality reduction of the

purchased products. Powerful suppliers can squeeze the profitability of an industry so far that

they can't recover the costs of raw material inputs. They are companies that supply raw materials,

equipment, machinery, associated services, and labor.

The case of Pay-Tv

Many television channel stations are relatively unimportant channels. The television channel

stations with high market shares are the ones that are powerfully loaded with premium contents

and significantly latest contents. These television channels are not easily prepared to offer their

channels to Pay-Tv providers unless the Pay-Tv providers are rated top-notch. Established Pay-

Tv like MCN has built lots of relationships and contacts with different television channel stations.

MCN also has a huge network of international and local television channels.

Threat of substitute products

All products within an industry compete with industries producing substitute products and

services because substitutes reduce the probable returns of an industry by employing a top limit

on the prices those businesses in that industry can profitably charge. Finding substitute products


32

involves probing for other products or services that can perform the same purpose as the

industry’s products (Riley, 2012).

The case of Pay-Tv

Pay-Tv is unique and innovative. Pay-Tv has unique software that decodes signals transmitted

from the satellite and will continue to grow and develop staying ahead of the competitors in terms

of differentiation. Pirated Satellite television such as Dream-box is popular because it’s free.

People who watch Pirated Satellite television can watch most channels free-to-air (FTA) without

being charged payment for a subscription. Ordinarily, Pay-Tv has a relatively high purchase price

for the hardware, and a monthly subscription is required.

Rivalry among established firms

The rivalry is the competitive struggle between firms in an industry to gain market share from

each other (Hill & Jones, 2007). The competitor is the first to be dealt with in competitive

environment (Bateman & Snell, 2004).

The case of Pay-Tv

Pay-Tv industry offers the consumers lots of innovative options that are different from

competitors. Low levels of product differentiation are associated with higher levels of rivalry.

The industry focuses on Brand identification, awareness, and knowledge. This tends to constrain

rivalry. However, Pay-Tv market is growing has a lot of potential customers that are beginning to

key into the Pay-Tv Culture. This is beneficial because, in a growing market, companies can

improve revenue. In a small market, companies have to compete for market share. Rivalry

increases in a small market where many competitors compete for available market share.


33

Conclusively, Porter’s five forces model, as it applies to Pay-Tv industry, shows that the

television market is attractive, offering lots of opportunities. But similarly, it is very difficult with

the high powers of the buyers, substitute and the rivalry to consider. Most of the threat comes

from the buyer inclination to substitutes and the price. These substitutes are Pirated Satellite

television such as Dream-box, Star Times, and Consat. As for the high power buyers, this power

comes due to buyers not being concentrated. Buyers can choose freely and choose the best

product suitable for them. Also buyers are price sensitive, and the advantage of free television

channels affects the purchase of a new hardware because, to switch to a new Pay-Tv, buyers have

to purchase new hardware.

The degree of rivalry shows that most Pay-Tv offer the consumers lots of innovative and extra

options that are different from one firm to another. In the Pay-Tv industry, there is a difference in

the competitors’ technology offering. This is good because low levels of product differentiation

are associated with higher levels of rivalry. Still, Pay-Tv industry does have some competitors to

be concerned about and because all these competitors are competing for the same consumers, the

rivalry increases. To increase market share in the television market, MCN has to distinguish itself

from the competitors.

2.7 Market share

Gaining or building market share is an offensive or attack strategy aimed at trying to increase

market position at the expense of competitors. According to Szymanski, Bharadwaj, Varadarajan

(1993), a firm builds market share by stealing it from others. There is a conspicuous sense of a

battle. The quest of competitor-oriented goals is constant with the long-held belief that business

is like warfare. In the late 19th century, it was prevalent for executives to endeavor for revenue

growth. To measure their performance, they compared themselves to their contenders in the


34

industry. Judging from Lanzillotti (1958) in Kotler and Keller (2006), competitor-oriented goals

typically articulated in terms of market share were commonly utilized by large businesses well

before the 1950s.

The market-share analysis should provide the managers with much needed information on the

structure of the market and competition and the influence of marketing actions on brand

performance all of which are indispensable for them to be able to establish viable marketing

strategies. The market-share analysis is profit-oriented in the sense that every firm is interested in

not only market-share movement, but also its profit consequences. One might talk about a plan to

expand the market share for a firm’s product/brand by improving quality, reducing the price,

advertising more, employing more sales personnel, etc.

2.8 Market share change

According to Khalid, Lewis, Inder and Rajiv (2011) market share change is as a result of market

forces, business competitive position and marketing efforts. Although there is a wide range of

market share change forces occurring in any given market, market share change is based on the

collective influences of these forces that shape market share change. Market forces that shape

market share change are generally beyond the control of a business. Market growth, the size of

shares and competitor entry all create market forces that tend to lower market share whereas

competitor exit contributes to market share gains (Armstrong and Green, 2007). Hence, Porters

(2008) five forces analysis shapes the market share of a company. The five forces framework,

which constitutes an industry structure, was developed as a tool for evaluating the profit potential

or attractiveness of different industries and sectors (Johnson, Scholes, & Whittington, 2008: 59).

According to Harvard Business Review (2008), Porter’s five forces have shaped a generation of

academic and business practice. These forces include buyer’s power, suppliers’ power, the threat


35

of substitution, the threat of new entrants and rivalry among existing competitors. As a result,

passive strategic market plan with respect to either improved competitive position or marketing

effort is likely to result in share loss. To grow market share a business needs to enhance

competitive position or intensify marketing effort. Each of the factors that affect a competitive

business position also indirectly affects market share. Hence, improving a product quality about

competitors’ products would increase market share. Marketing efforts also affects market share

change (Szymanski, Bharadwaj, and Varadarajan, 1993:1-18). In a growing market with more

customers and competitors entering the market, a business needs to expand its marketing effort to

protect or gain share.

2.9 Growth strategy

According to Moeller (2008), Firm’s growth is an integrated approach affecting every functional

area and strategy within the organization. Organization’s growth is concerned with how the

organization is executing fundamental changes whether the organization is small or large and

private or public. It is essential to note that successful enterprise development is likely to require

substantial investments in skills, organizational processes, and technology. Enterprise

development initiatives may be driven by external opportunities that will force the evolution of

strategies such as targeted market, value plan, product/service offering and contenders’ initiatives

(Moeller, 2008).

Growth can be promoted internally by investing in expansion or externally by procuring

additional business divisions. Internal development can include the growth of new or changed

products. External development usually involves diversification which means the acquirement of

businesses that are associated to existing product lines or that take the corporation into new

regions (Daft, 2008). Moeller (2008) indicated that to reinforce one’s company development


36

potential, the creation of new businesses and new market space, businesses might concentrate on

a new set of client need or consumer segments or they might introduce new forms of delivering

value. The strategy ultimately requires achievement of a fit between the external situation and

internal capabilities (Mintzberg, Bruce and Joseph, 2005). The external situation that constitutes

risks and opportunities include influences from political, social, economic and technological

arena. The internal environment, on the other hand, constitutes internal competencies including

the strengths and weaknesses of the organization systems, policies, resource capacity and the

organization culture (Koigi, 2002). Ansoff (1987) presented a corporate growth strategies matrix

that focused on the firm’s present and potential products and markets. By considering ways to

develop via current products and new products, and in current markets and new markets, there are

four probable product-market combinations; market penetration, market development, product

development and diversification (Ansoff, 1987).

1. Market penetration strategy

Market penetration is defined as a firm’s development in the current market with its current

products (Kotler, 2003). This strategy urges customers to buy frequently and buy more products

at every purchasing (Kotler, 2003:73). The strategy depends on forecasting whether a firm can get

a larger market share in the current market with its current products. Success in market

penetration depends on current consumers’ purchasing more products more frequently, gaining

rival business’s consumers and persuading prospective consumers who have not purchased from

that firm yet to do some buying (Kotler, 2000:75). If companies can form strong relationships

with consumers, consumers’ buying frequency and the amount can be improved. Also, current

consumers’ endorsing the business and its products to their locality, new consumers can be

acquired at no cost (Şener & Behdioğlu, 2013:167). Market penetration strategy facilitates right

of entry to such local resources as distribution grids in the target market, local businesses, and


37

authorities (Meyer & Tran, 2006:179). However, growing distribution markets might also cause

businesses to bear more marketing costs if not properly managed (Arkolakis, 2008: 31).

Kourdi (2009) also noted that Market Penetration is a strategy through which a firm seeks

development by growing sales of its existing products to consumers in its existing market

segments without changing the product. It means company selling more of the existing products

in existing markets. This can be achieved by taking a share from the competitors or by attracting

nonusers. The company can also develop new products for the existing markets (product

development) or enter new markets (segments) with present products (market development). In

Pay-Tv industry, offering customers a wider selection of TV channels and their recording on the

tablet is seen as a product development strategy, something believed to be a strength compared to

other offerings in the market. Also, Multiscreen has become a competitive dynamic in advanced

markets. The main benefit of this strategy is that the firm should be very familiar with both the

products and the market segments.

Approaches to market penetration strategy.

Kotler, Keller, Brady, Goodman and Hansen (2009) opined that market penetration strategy can

adopt the following approaches namely:

1. Increase or retain of market share

2. Growth market domination

3. Driving out competitors

4. Increase in customer usage

These four approaches as represented in fig 2.4 can be adopted by a firm when implementing

penetration strategy.


38

Fig.2.4: Approaches to market penetration strategy

Source: http://free-management-ebook.com/ accessed on 24th March, 2015.

Retain or increase market share:

This approach entails adopting a strategy that consist of competitive pricing strategies,

advertising, and sales promotion and focusing on the areas of sales and marketing that can attract

competitor’s customers. Many business owners naturally begin to consider tactical actions that

are focused on immediate sales. Ordinarily, Price discounting is an obvious example that may

provide a spike in demand for product or service in this approach.

Dominate growth markets:

Although marketing penetration involves selling existing product or service to existing

customers, a new segment of customers can be identified. Hence, growth can only occur if the

strategy is altered in that route to belligerently market the identified groups. It may be invaluable


39

to initiate a promotional campaign that notifies consumers of the features, benefits or even just

the accessibility of product or service. Many times people are simply unaware of the product or

service and how it is relevant to their situation.

Drive out competitors:

Operating with the lowest mutable costs in the industry is an advantage that can be leveraged to

accelerate sales while establishing a barrier to entry. Many companies with superior technology

or unique processes have lower variable costs than competitors and, therefore, higher gross

margins per unit sold. Rather than lowering price to gain market share, it may make sense to

spend money on the introduction of loyalty campaigns, loyalty programs, and promotional

campaigns competing for market share through customer loyalty programs. This approach is

predominant in the Pay-Tv industry where the larger players now dominate because the market is

drenched, and the only approach to attaining market share is to take it from competitors.

Increase existing customer usage:

As a substitute to growing market share, a business can use market penetration strategy to

increase product usage by introducing small changes to the business. Strategies that can induce

existing customers to use product or service frequently include loyalty schemes, adding value or

making alterations to the existing product and the use of seasoned technologies that are customer

friendly. Increasing product usage also involves taking some time to consider how the customers

use the product and the situations that prevent increased usage to address barriers that customers

experience.

However, Vikas (2011) tacitly stated that penetration pricing strategy is one of the most effective

marketing strategies available to a business that can be used to achieve the above approaches to

market penetration strategy. This strategy includes setting a reduced entry price for a new product


40

or brand to achieve a breakthrough in a highly competitive market. The strategy can also be

employed when launching a completely unique product in the market or when tapping a new

market segment for a current product (Vikas, 2011). A firm uses penetration pricing with the

anticipation that eventually the price will be elevated once the preliminary marketing goals are

fulfilled. Its purpose is to attract the consumers to try the firm’s product. By keeping the price

deliberately lower than confirmed contenders, the business targets to compromise current brand

loyalties of the consumers. The vital goal of this strategy is not to maximize revenues, but to

permit a new product or brand to gain traction in the marketplace (Vikas, 2011).

2. Market development strategy

A firm follows a market development strategy for an existing brand when it grows the

prospective market through new users (Kumar, 2010). This can be done through spreading out to

new geographic segments, new demographic segments, new institutional segments or new

psychographic segments. Another method is to grow sales through new uses for the product.

Market development strategy depends on the detail that consumers prefer buying a firm’s current

products in new markets rather than the competitor products (Kumar, 2010:96). Market

development increases sales by gaining access to new segments and converting nonusers into

consumers of the business. Therefore, new geographic areas, fresh influential markets or market

departments with fresh life forms might be among the objectives of a firm. Businesses are in

quest of new users for their current products. The core hazard in this strategy is that the brand

might flop because it hasn’t understood consumer physiognomies, needs and demands effectively

and evidently (Schultz, 2004:7-9). The market development method requires more extensive

assessment of the market system. Determining the contenders in the market, their strengths and

their roles in the value chain is essential. Also, assessment of the prospective new contenders in


41

the market is essential during decision making. Assessment of current and prospective contenders

is the basis for market-oriented solutions and decisions of business (Lusby, 2006:341-343).

Implementation of the tactic will rely on the nature of the knowledge, technology, and

competence resources available to the enterprise. The implementation of strategies will be

constrained by the need to make the best use of the available resources to meet financial

obligation, and to ensure survival in the face of increasingly harsh demands of competitive

international trading environments or performance–oriented public sector decision-makers

(Morden, 2007).

Having the capability to respond rapidly to the external environment with new products and

services is an advantage of being a privately-owned business. Enterprise permits employees to

make decisions at a local level and has fashioned an entrepreneurial spirit within the organization.

This means that strategies are regularly reviewed to ensure that Enterprise remains the market

spearhead. New possibilities of business are explored and researched. Underlying all of these

modifications are Enterprise’s founding values. The main peril facing a firm following a market

development strategy for a brand is that it could fail to effectively comprehend the new consumer

base.

3. Product development strategy

Product development strategies have helped enterprise to develop services in a market where it is

already an established and profitable business. This is deliberated to be the intermediate risk

strategy. Examples of Enterprise’s product development include its unique ‘Pick-up’ service. This

helps to lead the market in this product offering. When a firm alters its product in some way with

the expectation of improving sales to existing consumers, that strategy is known as product


42

development (Bagozzi, Richard, Rosa, Celly and Coronel, 1998). There are three major methods

that this can be done according to Bagozzi et al.(1998) depending on whether a fresh brand name

is used for the fresh product or not:

• New feature, quality or technology, but no new brand name

• New brand name as a brand extension

• New brand name with distinct identity

The product development strategy also entails asking whether there are any segments of the

current customer base in the market that could be served better with a new product or brand.

4. Diversification strategy

Diversification means the departure from company’s resources and key competencies (Dewitt &

Meyer, 2007). It means resigning from effects of synergy in a company’s portfolio. In fact, as it

happens in conglomerate diversification, the only synergy may sometimes be the so-called

financial synergy (Dewitt & Meyer, 2007). Pure diversification would necessitate acquiring new

competencies by a company. It seems that the departure from company’s resources required by

diversification, explains why this strategy is not so popular in a real world.

Any alteration of an existing product that serves to expand the prospective market implies that the

firm is following a strategy of product diversification (Kerin, Roger, Eric, Steven and William,

2003). The product diversification strategy is dissimilar from product development in that it

entails creating a new consumer base, which by definition develops the market potential of the

original product. This is almost always done through brand extensions or new brands, but in some


43

cases the product alteration may "create" a new market by crafting new uses for the product

(Kerin et al., 2003).

2.10 Relationship between growth strategy and market share

Market share by definition refers to company sales divided by the total sales of all firms for a

specified product in a given market over a given period (Cravens and Piercy, 2006:90). In this

research, market share was viewed from the “Marketing concept” which defines the marketing

management philosophy, which holds that accomplishing organizational objectives depends on

determining the needs, and wants of objective and delivering the desired fulfillment more

effectively and efficiently than contenders. According to Kotler et al. (2005:914), one of the

ways in which success of any strategy implemented in any company can easily be identified is

from its profits and market share. In this study, concentration is on the market share/turnover to

assess the efficiency of strategies adopted by MCN as “the ultimate test to assess the company’s

marketing strategy. As Rugman and Verbeke (2004:335) noted, the level of accomplishment of a

marketing strategy can be seen in terms of market share, and the Boston Consulting Group (BCG)

matrix is always suitable for use.

The BCG matrix: The BCG matrix indicates the balance of a portfolio of the business in a

relationship between market share and market development (Johnson, Scholes and Whittington,

2006:249). The context of which this BCG matrix is used has excluded the idea of balance of

matrix and only considers the relationship between the market share and market growth.


44

Fig 2.5: BCG MATRIX

Source: Adapted from The growth share (or BCG) matrix. (Johnson, Scholes and Whittington,

2006:250).

Cash cows are businesses with a high market share in mature markets (low market growth with

stable conditions). This type of business does not need heavy investment in marketing but

maintain unit cost lower than competitors, and they are known as cash providers.

A star represents a business with a high market share in a growing market and much is being

spent to gain market share, but this cost reduces faster than that of competitors over time.

Dogs, on the other hand, have a low market share in static or declining markets, and they are cash

drains as a huge amount of company time and resources are spent on them. As the market growth

rate is important for a business or company seeking to dominate the market, it is appropriate for


45

that company to be a star. This is explained by the idea that higher profit levels often come from

product or business with high market share in more stable markets.

Question marks (problem children): Low market share and high market growth. These are the

opportunities that no one knows how to handle. ‘Questions mark’ is a business in a growing

market but without a low market share. They aren’t yielding much income right now, because of

they lack great market share. But they’re in high-growth markets, so they could become Stars or

even Cash Cows if market share is developed. However, if market share cannot be improved,

Question Marks could engross a lot of effort with little return.

2.11 Market penetration strategy in Pay-Tv

First, the cost of acquiring and installing Pay-Tv facilities is always considered by a potential

subscriber that serves as a market strategy (pricing strategy) to the companies in the industry.

Also, content plays a central role in Pay-Tv competition. In choosing between firm’s

products/contents, consumers base their choice largely on the programming available from each

one (Armstrong, 1999). In particular, highly attractive programming, especially live coverage of

popular sports events and recent movies drive consumer choice (Armstrong, 2000). By making

such content available exclusively to subscribers, it helps a firm to gain market share from its

rivals and serves as a necessary competitive strategy (Armstrong, 2000). Access to premium

content has been major competition concerns in the Pay-Tv sector in some countries. In

developing countries like Nigeria, premium content is often monopolized at the source (e.g.

sports coverage) or becomes fixated in the hands of a single Pay-Tv operator. Companies in Pay-

Tv industry differentiate products both in the means of delivery and in the content of the

programming packages offered. Products of “basic” programming are also obtainable which

must be viewed by all subscribers who can then buy “premium” programming, usually key sports


46

events and movies which attract payment of additional monthly fees. Obviously, marketing

strategy in Pay-Tv today has adopted the following dimensions.

Consumer centric

Market penetration strategy in Pay-Tv today emphasizes that the business should put the

consumers’ satisfaction in the first place, in a way that, the product provides for the consumers’

demand with a reduced purchasing cost for consumers. When developing a new product, buying

power needs to be considered. Moreover, business should provide convenience to customers

when they are buying. Finally, business should have efficient consumer-oriented communication

with their clients. This includes Customer’s needs and wants, Cost and Value to satisfy

consumer's needs and wants, Convenience to buy and Communication with the consumer (Chen,

& Zhang, 2001).

Industrial chain

The Pay-Tv industry of the 21st Century entails developing an industrial chain including

distributors, integrated operator, wired network operator and users. Pay-Tv depend on reputable

chain of distribution in order to convey content to the ultimate user and this chain of content

delivery ranges from the channel partners, the retail outlets and the wired network operators who

finally convey them to the users’ home through local wired network or via Digital Satellite

Decoders (DSD). In this Chain, integration of operators plays a very important role in the content

delivery. Its main responsibility is to deliver pay Channels to local network company and have

relative agent marketing.


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Social media marketing

The marketing of pay channels is also conducted via the Internet on smartphones and social

media, with swiftness of communication, minimal operational cost, flexibility, and interactivity.

The emergence social media application brings opportunity to the development of mobile TV.

Provision of free preview to expand the scope of publicity.

The publicity of pay channel has always been the weakest sector. Up till now, except for digital

Pay-Tv occasionally cited in the news, it rarely appears in any publicity of communication media.

Also, being as the sale access, local wired network firms rarely propagate pay channels. In this

highly competitive business environment, the situation is beginning to improve; Pay-Tv

companies are giving publicity in different ways that include delivery of free preview to enlarge

the scope of publicity, letting audience know more about them. Only in this manner can they

grow better and attract more audience. Winning the trust of the audience demands positive

attitude, good service, and variable choices. For Pay-Tv, a free preview is the best method of

publicity. Pay-Tv in the foreign country regularly uses this method to attract consumers. Free

preview frequently used in the wired television offers a period for the audience to view the pay

channels for free (Chen & Zhang, 2001).

Low charging fee

Currently the pay channels have made a breakthrough and their income model does not rely on

TV fee only, but extends to the other aspects, including the followings: First is the TV Fee:

Acting as a program content integrators and program content provider, pay channel shares

incomes with all-level network companies. This is the key part of their income. Secondly, the

sales income of the TV programs: The TV programs of pay channels have a great degree of

specialization, and they can have secondary growth being vended to other broadcast platforms.


48

Establishing an impeccable customer service system

The customer service system is an organization with the management of staff, business plan,

technology, and strategies. It offers an appropriate manner for getting organization resources. It

creates consumers value and corporation value by mutual communication manner. The customer

service system advances around service, with the essential conception of satisfying customers.

Winning fulfillment and loyalty of customers promotes the win-win exchange and influences the

objective of marketing performance. It also creates a favorable opinion and strengthens the public

image of the company. Thus, as noted by Du & Wang (2009) to achieve an enduring

development, Pay-Tv perfects its customer service system in the following steps:

(1) Setting up 24-hour free service line, which is Call Centre. Answering phone calls from

customers at any time and resolving their problem. Also, those customer service representatives

should be monitored in real time to ensure the quality of service. By increasing the number of

customer service representative and the quality assurance analyst would prompt an increase in

answering rate of phone calls thereby dealing with customers’ complaints timely and seriously.

(2) Building up perfect operations supports system. It is an essential task in this age where

customers want to be engaged in the business to offer approachable information and

communication system to lessen frustrations customers may encounter in the course of solving

challenges associated with usage of the product. Hence, the proliferation of customers’ touch

points has made it necessary to provide service to the customer according to their demand.

However, in the Pay-Tv industry, the control of uncommon, premium content rather than

distribution channels has become gradually vital to commercial dominance (Seabright and

Weeds, 2007; Huigen and Cave, 2008; Hutchins and Rowe, 2009). Thus, there is a greater

responsibility on regulators to ensure that the potential benefits of competition are not squandered

through abuses of market power in other points of the value chains (Cave, 2005: 27).


49

2.12 Marketing strategies implemented by MCN

MCN has implemented some strategies to increase its market share and the strategies

implemented are both at the business and corporate level.

Business level strategies

At the business level, this company implements pricing, differentiation and diversification

strategies and the details are explained below:

Pricing strategy

The pricing strategy implemented by this company is higher prices compared to competitors.

These higher prices are due to the high cost acquired in the development of product content,

advance/modern technology and high-quality measures. These higher prices are charged in all its

distribution and sales Center, implying that there is no price premium no matter the type of

market situation.

Differentiation strategy

The differentiation strategy in MCN occurs in the form of content production, wholesale channel

provision, and retail service provision. There is also the wholesale market where content is

packaged into channels or bundles. There is also the retail market where contents are delivered to

consumers through a technological platform.

The packaging of contents into channels or bundles with unique features is what differentiates the

strategy from that of the competitors.


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Corporate-level strategies

At the corporate level, the strategies implemented by MCN are acquisition and

partnership/networks.

Partnership/networks

Partnership and networks are some of the ways in which this company enters new markets.

Partnerships are formed with a major customer while networks are established with some dealers

already established in the country or market the company plans to enter. The motive for forming

these networks and partnerships is to reduce the cost of setting up new centers so that they can be

cost efficient. This is the method through which the recent market in Nigeria is entered.

Furthermore, partnerships are also formed with distributors, integrated operator, wired network

operator, and users.

Acquisition

MCN adopts the strategy of acquisition of sales centers to enhance distribution channels thereby

giving some market access to its products/services. This contributed to the maintaining of the

company’s market share.

Sustainability of strategies

In-house, controlled information policy is one of the means through which the company’s

strategies are sustained. To gain access to definite information from the firm’s website, a

password/username login is required, and the firm can only provide this. This makes it very


51

difficult for non-dealers of this firm or competitors to get access to certain information or to copy

the products.

2.13 Summary of literature

There are dangers linked with all strategic options. Whether or not the peril is worth taking

depends upon the organization’s present position in terms of the prospects available in current

markets and with current products or services. Hazards are minimal when the direction for

development is essentially based upon current key capabilities (penetration strategy) and

resources, and when it takes place in existing markets. However, to increase or maintain market

share in a fierce competitive market, MCN must embrace effective growth strategy that enables

the organization achieves target objectives and competitive advantage. Also, several other

marketing strategies and strategic options must be considered vis-a-vis the company’s strengths

and weaknesses. Hence, there is the need for MCN to adopt a more competitive marketing

strategy to gain competitive advantage and improve its market share that is on the decline.

2.14 Conclusion

This chapter gave a comprehensive literature review from several authors and scholars. It discussed

in detail the independent and dependent variables of this study, the definition of strategy, marketing

strategy penetration strategy and market share. Also reviewed in this literature are Ansoff growth

model, approaches to market penetration strategy, Michael Porter’s Generic Strategy options and

BCG matrix analysis as it relates to market share. Research methodology - research design and

instruments; data analysis and so on will be discussed in the next chapter.


52

CHAPTER THREE

RESEARCH METHODOLOGY

3.1 Introduction

The purpose of this study is to examine market penetration strategy to improve MCN Market

share. This chapter therefore, focuses on the methods that are used to collect and analyze data for

the study. It concerns the research design, the characteristics of the population, the sample

selection procedures, and sampling techniques used. Others include; data collection instruments

and methods of verifying its reliability and validity, method of data analyses, and the limitations

of the methodology used as well.

3.2 Research design

This study adopted the mixed methods design, that is, a mixture of qualitative and quantitative

research that adopts the survey method for investigating market penetration strategy and market

share in MCN by relying on the responses of respondents. This research comprised of all the

organizational members in MCN and the representatives of the company. The survey methods used

were observation checklist and structured questionnaires for staff. The researcher also carried out

an in-depth face/group interview and the questionnaires were sent to the email box of the

respondents.


53

3.3 Population of the study

The population of this study comprises the Top management staff, Middle management staff and

Lower management staff of MCN, Lagos office. Information from the Human Resource Unit

(HRM) of MCN reveals that the total number of staff is approximately 617. The target population

for the research is equal to the universe that is, the total number of staff in the company.

3.4 Sample size and sampling techniques

A stratified sampling technique was adopted for this research. Therefore, it is a census study.

Data administration and collection was very efficient due to the population size and the

familiarity that exists among staff of MCN. Using the sample size calculator, a sample size of 83

was selected from the population of 617 which consist of three categories of staff as shown on the

distribution table.

Table 3.1: Sampling distribution table.

Frequency Percentage Valid

Percentage

Cumulative

Percentage

Top management 100 16.21 16.21 16.21

Middle Management 200 32.41 32.41 48.62

Lower Management 317 51.38 51.38 100

Total 617 100.0 100.0

Source: Field survey, 2015.


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Hence, a stratified sampling technique was applied to select 13 top management staff, 27 middle

management staff and 43 lower management staff in order to bring the sample size to a total of 83

respondents. Sample size calculator was used at 95% confidence interval to determine the sample

size. Hence, population size of 617 at 95% confidence interval gives a sample size of 83

respondents. For selected sample in each stratum, the formula is given as:

Top Management (TM) = 100/617 *83 = 13.4, approximately 13

Middle Management (MM) = 200/617 * 83 = 26.9, approximately 27

Lower Management (LM) = 217/617* 83 = 42.6, approximately 43

Total Sample size = 83

3.5 Research instruments

This study adopted triangulation method. Triangulation, according to Angen (2000) refers to the

use of more than one approach to the investigation of a research question in order to enhance

confidence in the ensuing findings. Hence, a combination of in-depth interview, questionnaire

and observation checklist was used for this research. This is to offer the prospect of enhanced

confidence. A structured questionnaire was used. The questionnaire was based on the 4 point

Likert scale format. The interview was recorded and the responses transcribed for easy analysis

and it was based on both research objectives and research questions. The observation checklist

was based on both the research objectives and research questions. Observational method utilized

the varying extents of control over the environment in which the observation took place.


55

3.6 Validation of research instruments

Validity is when a research instrument measures what it is supposed to measure. The

questionnaire items were mapped to the research questions and objectives. The questionnaire was

also shared with the researcher’s dissertation internal examiner for face and content validation.

The research instrument was presented to the internal examiner for review and approval prior to

testing and administering on the participants, it was given the go ahead for use.

3.7 Reliability of research instruments

Reliability is the consistency of repeatability of test over time. To ensure the reliability of the

instrument used in this study, a pilot survey was carried out on a small group of respondents

bearing similar characteristics with that of the surveyed group. Also, the questionnaire items and

its scale was checked and moderated by the researcher’s internal examiner. On the whole,

questionnaire items were clearly understood by the pilot respondents. The research instrument

was pilot tested on 10 staff in Ogun state, outside the selected state, Lagos to avoid contaminating

the target population. Subsequently, the instrument was re-administered a week later on the same

10 participants. The results from the first and second tests were correlated using the Pearson’s

product moment correlation formula, producing a correlation coefficient of 0.57. The researcher

was therefore able to confirm the reliability and validity of the research instrument.

3.8 Procedure for administration of instruments


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The researcher made use of the MCN internal mailing system to dispatch questionnaires to

participants marked to receive questionnaires while a convenient period was negotiated with

participants marked for interview. The research instrument was accompanied by a cover note.

The cover note assured the respondents that the information requested would only be utilized for

the purpose of research and all data would be treated in confidence and anonymity. A total of 83

questionnaires were dispatched to participants and properly filled and returned questionnaires are

in this order presented below.

Top Management Staff - 13

Middle Management Staff - 27

Lower Management Staff - 43

Total - 83

3.9 Tools for data analysis

Data analysis of the study was carried out using frequency distribution analytical method and

simple percentage which was represented graphically by the use of Microsoft Excel chart tools.

The analysis of the interview session and questionnaire response were summarily transcribed and

depicted in chapter four of this research work.

3.10 Conclusion


57

The Research methodology used in administering, collecting and analyzing data from respondents

are discussed in this chapter. In the next chapter, analysis of data based on respondents’ responses

to the research questions and results are presented.


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CHAPTER FOUR

RESULTS

4.1 Introduction

This chapter presents results of relevant data analysis. Data are presented by tabulations of results

on the basis of Research Questions. Results of relevant data analysis are presented to determine

respondents’ opinion on most effective marketing strategy that can be used to improve market

share in MCN. Presentation of demographic data precedes all other aspects of data analysis in this

section.

4.2 Presentation of respondents demographic data

Observation I: The researcher observed that the respondents were knowledgeable enough to provide answers to the research questions.

Research question I: What are the socio-demographic data of employees in MCN?

Table 4.1: Gender of respondents

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid

Male 46 55.4 55.4 55.4

Female 37 44.6 44.6 100.0

Total 83 100.0 100.0



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Fig. 3.1: A chart showing gender of respondents.

55%45%

Gender of Respondents

MaleFemale

Table 4.1 shows that 46(55.4%) male and 37(44.6%) female respondents participated in the study

adding up to 83 respondents. This implies that the study was made up of more male than female

respondents.

Table 4.2 Educational qualification

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

OND/NCE 17 20.48 20.48 20.48

HND/B.Sc. 56 67.46 67.46 87.94

M.Sc./MBA 10 12.04 12.04 100.0

Total 83 100.0 100.0

Source: Field Survey, 2015.


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Fig. 3.2: A chart showing qualification of respondents.

Table 4.2 shows respondents’ educational qualification. It is clear from the table 4.2 that 17(21%)

of respondents were OND/NCE certificate holders, 56(67%) were HND/B.Sc. /B.A. degree

graduates and they constituted the highest group of respondents in the study, while 10(12%)

respondents were postgraduate degree holders. Thus, the study was carried out among educated

group of respondents who were expected to understand the subject matter of the study and to

make meaningful contributions towards solving the research problem.

Table 4.3: Respondents age


61

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid

Below 30yrs 16 19.2 19.2 19.2

30-40yrs 34 41.0 41.0 60.2

41-50yrs 22 26.5 26.5 86.7

51yrs and above 11 13.3 13.3 100.0

Total 83 100.0 100.0


Fig. 3.3: A chart showing the age of respondents.

19%

41%

26%

13%

Respondents Age

Below 30yrs30-40yrs41-50yrs51yrs and above

Table 4.3 indicates that 19% of the respondents were below 30 years. Similarly, 41% were

between 30-40years, 27% were between 41-50 years and 13% were 51 years and above. This

suggests that most of the respondents were between 30-40 years.


62

Table 4.4: Years of experience in this organization

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid

1-5years 48 57.8 57.8 57.8

6-10 27 32.5 32.5 90.4

11-15 8 9.6 9.6 100.0

Total 83 100.0 100.0


Fig. 3.4: A Chart showing respondents years of experience.

58%33%

10%

Years of Experience

1-5years6-10years11-15years


63

Table 4.4 revealed that 58% of the respondents have 1-5 years’ experience on the job. 32% of the

respondents have 6-10 years’ experience and 10% have 11-15 years’ experience on the job.

Hence, majority of the respondents have been on the job for 1-5years.

4.3 Opinion of respondents on the research questions

The data analysis in this section is presented on the basis of relevant research question as

captured by the questionnaire.

Observation II: It was observed that MCN adopted product development strategy by only adding program contents to the TV channels without creating awareness to the customers.

Research question II: What is the marketing strategy that is adopted in MCN? In providing

answers to research question II, Questionnaire items 1-6 of the Section B and interview question

1, 3 and 4 in the staff interview guide were used.

Table 4.5: Development of market oriented strategy

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid

Strongly Agree 38 45.8 45.8 45.8

Agree 36 43.4 43.4 89.2

Disagree 6 7.2 7.2 96.4

Strongly

Disagree3 3.6 3.6 100.0

Total 83 100.0 100.0


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Table 4.5 indicates that 45.8% of respondents strongly agreed that MCN adopts development of

market oriented strategy. 43.4% agreed, 7.2% disagreed and 3.6% strongly disagreed. This

suggests that respondents were of the opinion that MCN adopts development of market oriented

strategy. The implication is that MCN understands what is happening in the industry in which it

operates; it is invaluable to know what the trends in the industry are as well as what the firm’s

competitors are doing to make money, to improve their businesses, and to improve their own

market shares.

Table 4.6 Implementation of market oriented strategy

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 22 26.5 26.5 44.6

Disagree 35 42.2 42.2 86.7

Strongly

Disagree11 13.3 13.3 100.0

Total 83 100.0 100.0


Table 4.6 indicates that 18.1% of respondents strongly agreed that MCN embarks on

implementation of market oriented strategy. 26.5% agreed, 42.2% disagreed and 13.3% strongly


65

disagreed. This suggests that respondents were in disagreement that MCN actually implement the

plan. Hence, results from the analysis of market trend are not implemented.

Table 4.7: Collection and use of market information

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 14 16.9 16.9 51.8

Disagree 26 31.3 31.3 83.1

Strongly

Disagree14 16.9 16.9 100.0

Total 83 100.0 100.0


Table 4.7 shows that 34.9% of respondents were strongly of the opinion that MCN collects and

make use of market information. 16.9% agree, 31.3% disagreed, and 16.9% strongly disagreed.

This indicates that slightly 51.8% of the respondents agreed that MCN collects and analyses data,

and interprets and reports the findings for implementation.

Table 4.8: Collection and use of customer information to improve quality

of products and services

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid Strongly Agree 16 19.3 19.3 19.3


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Agree 20 24.1 24.1 43.4

Disagree 32 38.6 38.6 81.9

Strongly

Disagree15 18.1 18.1 100.0

Total 83 100.0 100.0


Table 4.8 shows that 19.3% of respondents strongly agreed that the company collects and use

customer information to improve quality of products and services, 24.1% agreed, 38.6%

disagreed while 18.1% strongly disagreed. This suggests that the company does not use customer

information to improve product quality and customer services.

Table 4.9: Free-To-Air content strategy to attract competitors’ customers.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 16 19.3 19.3 37.3

Disagree 31 37.3 37.3 74.7

Strongly

Disagree21 25.3 25.3 100.0

Total 83 100.0 100.0


Table 4.9 shows that 18.1% of respondents were strongly of the opinion that the company adopts

free-to-air content strategy to attract competitors’ customers. Similarly, 19.3% agreed, 37.3%


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disagreed and 25.3% strongly disagreed. This suggests that majority of the respondents were of

the opinion that MCN does not adopt free-to-air content strategy to win market share.

Table 4.10: Marketing strategy based on the strengths of the company to

provide customer needs.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 21 25.3 25.3 59.0

Disagree 19 22.9 22.9 81.9

Strongly

Disagree15 18.1 18.1 100.0

Total 83 100.0 100.0


Table 4.10 shows that 33.7% of respondents strongly agreed that MCN marketing strategy is

based on the strengths of the company to provide customer needs. In like manner, 25.3% agreed,

22.9% disagreed and 18.1% strongly disagreed. This implies that the respondents agreed that

MCN’s marketing strategy relies more on the company’s strength, hence not ready to take risk

even when new opportunities arise.

Interview question 1: What can you say about MCN Marketing Strategy?

Management staff response to interview question 1, 3 and 4: 6 out of the 13 managers

interviewed commented on the pricing strategy of the company. They asserted that pricing

strategy implemented by the company is higher prices compared to competitors. These higher


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prices are due to the high cost incurred in the development of the market, modern technology,

operational cost and high quality measures. These higher prices are charged in its entire

distribution and sales center, implying that there is no price premium or discount currently being

implemented.

Also, 4 of the managers commented on the distribution strategy of the company. ‘‘Placement’’ or

Distribution strategy as 1 of the managers put it, helps make the purchasing process for a

customer easier and more convenient. The placement component of a marketing strategy

includes the decisions a company or firm must make to ensure the connection with the customer

or client. Placement is how the marketer connects the products or services with the customer the

easier, more convenient, more accessible the product or service may be, the more likely the

customer will purchase the product or service. However, they concluded that MCN placement

strategy has not been effective enough as there are so many groups of people that have not been

captured by the marketing team.

In addition 10 of the respondents agreed that MCN has not been able to integrate customers in its

marketing approach. What they rely on is still the old tradition of marketing campaign without a

commensurate customer’s interaction. Hence, the marketing strategy is a monologue approach.

Observation III: It was observed that lack of loyalty programs, discount pricing strategy and ineffective distribution channels hindered increase in market share in MCN.

Research question III: What are the challenges that hinder increase in market share in

MCN?

Questionnaire items 7-12 of the Section B and interview question 5, 6 and 9 in the staff interview

guide were relevant in answering research question III.


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Table 4.11: Company planning is organized around markets rather than

products or Services

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 34 41.0 41.0 89.2

Disagree 6 7.2 7.2 96.4

Strongly

Disagree3 3.6 3.6 100.0

Total 83 100.0 100.0


Table 4.11 shows that 48.2% of respondents were strongly of the opinion that the company

planning is organized around markets rather than products and services. Similarly, 41.0% agreed,

7.2% disagreed and 3.6% strongly disagreed. This infers that majority of the respondents were in

support that MCN relies on distribution channels, the easier and more accessible the product may

be, the more likely the customer will purchase the product.

Table 4.12. Company personnel do not have adequate information about

customers and competitors.


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Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 32 38.6 38.6 85.5

Disagree 6 7.2 7.2 92.8

Strongly

Disagree6 7.2 7.2 100.0

Total 83 100.0 100.0

Source: Field survey, 2015

Table 4.12 indicates that 47.0% of respondents strongly agreed that the company personnel do

not have adequate information about customers and competitors.38.6% agreed, 7.2% disagreed

and 7.2% strongly disagreed. This suggests that the company personnel lack customer

relationship management skill and competitors’ in-depth knowledge to win more customers.

Table 4.13: MCN do not obtain ideas from customers to improve products

and services

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 20 24.1 24.1 51.8

Disagree 31 37.3 37.3 89.2

Strongly

Disagree9 10.8 10.8 100.0

Total 83 100.0 100.0


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Table 4.13 shows that 27.7% of respondents strongly agreed that MCN do not obtain ideas from

customers to improve products and services. In like manner, 24.1% agreed, 37.3% disagreed and

10.8%strongly disagreed. This suggests that majority of the respondents agreed that MCN does

not engage their customers to know what they really want from the company.

Table 4.14: MCN focuses on areas in which the company has competitive

strength

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 36 43.4 43.4 89.2

Disagree 6 7.2 7.2 96.4

Strongly

Disagree3 3.6 3.6 100.0

Total 83 100.0 100.0


Table 4.14 shows that 45.8% of respondents were strongly of the opinion that MCN focuses on

the competitive advantage of the company.43.40% agreed, 7.2% disagreed and 3.6% strongly

disagreed. This implies that majority of the respondents are in support that MCN focuses on the

competitive advantage of the company.

Table 4.15: MCN does not keep promises made to customers


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Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 35 42.2 42.2 83.1

Disagree 9 10.8 10.8 94.0

Strongly

Disagree5 6.0 6.0 100.0

Total 83 100.0 100.0


Table 4.15 shows that 41.0% of respondents were strongly of the opinion that MCN do not keep

promises made to customers in terms of timely service delivery. 42.2% agreed, 10.8% disagreed

and 6.0% strongly disagreed. This infers that customers are not adequately integrated in MCN

marketing strategy which may result in loss of market share.

Table 4.16 : MCN is not innovative in its methods of operation

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 17 20.5 20.5 42.2

Disagree 29 34.9 34.9 77.1

Strongly

Disagree19 22.9 22.9 100.0

Total 83 100.0 100.0


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Table 4.16 shows that 21.7% of respondents strongly agreed that MCN is not innovative in its

methods of operation, 20.5% agreed, 34.9% disagreed and 22.9% strongly disagreed. This

implies that majority of the respondents disagreed that MCN is not innovative in its methods of

operation. Hence, there is endeavor by the company to differentiate itself positively from its

competitors, using its relative competitive strengths to better satisfy customers, solving of

problems efficiently and rapidly through integration system which fosters continuous patronage.

Interview question 5: What can you say about MCN market share decline?

Management staff response to interview question 5, 6 and 9: The managers interviewed were

of the opinion that marketing communication strategies need to be supported by carefully

selecting communication tools that will appeal to the target group. 7 of the managers interviewed

noted that the company’s promotional campaign must convey a message, a unique selling

proposition distinguishing the company from its competitors. The characteristics and benefits of

the products have to be communicated in order to create a link between the consumers and the

product. They also noted that there is still a huge gap between the customers and the company’s

marketing strategy. Hence, awareness will be generated using effective marketing communication

tools to provide consumers all the information about MCN Program contents. Majority of the

respondents suggested that the marketing communication instruments such as Advertising,

Promotion, Direct marketing and Public relations must be used to promote MCN contents among

the target group.

Observation IV: The researcher also observed that MCN market share has been on a decline.

Research question IV: What are the approaches to market penetration strategy that can be

adopted in MCN?


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Questionnaire items 13-18 of the Section B and interview question 2, 3 and 8 in the staff interview

guide were relevant in answering research question IV.

Table 4.17: The company values market position more than financial

performance

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 22 26.5 26.5 42.2

Disagree 30 36.1 36.1 78.3

Strongly

Disagree18 21.7 21.7 100.0

Total 83 100.0 100.0


Table 4.17 shows that 15.7% of respondents strongly agreed that the company values market

position more than financial performance. In like manner, 26.5% agreed, 36.1% disagreed and

21.7% strongly disagreed. This suggests that majority of the respondents disagreed to this effect.

The implication here is that MCN emphasizes on financial performance than implementing

programs that creates differentiation (e.g. loyalty programs) in the customer’s mind and

competitive advantage that enhances market position.

Table 4.18: MCN allows prices to be determined by customer value which

improves market position.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage


75

Valid


Agree 24 28.9 28.9 47.0

Disagree 26 31.3 31.3 78.3

Strongly

Disagree18 21.7 21.7 100.0

Total 83 100.0 100.0


Table 4.18 shows that 18.1% of respondents strongly agreed that prices are determined by

customer value which improves market position. 28.9% agreed, 31.3 % disagreed and 21.7%

strongly disagreed. This result indicates that majority of the respondents were of the opinion that

prices of Pay-Tv contents are fixed by the market price. Ordinarily, consumers will expect a

higher level of service if the fee associated with that service is higher relative to other firms in the

same industry.

Table 4.19: Adoption of free-to-air contents, especially sports and movies

enhances market share.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 37 44.6 44.6 91.6

Disagree 5 6.0 6.0 97.6

Strongly

Disagree2 2.4 2.4 100.0

Total 83 100.0 100.0


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Table 4.19 shows that 47.0% of respondents were strongly of the opinion that free-to-air strategy

like sports and movies enhances market share. Similarly, 44.6% were in agreement, 6.0%

disagreed and 2.4% strongly disagreed. The result therefore indicates that market share can be

improved through free-to-air strategy.

Table 4.20: Responds to customers/partners needs in creating terms of

service delivery.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 31 37.3 37.3 71.1

Disagree 10 12.0 12.0 83.1

Strongly

Disagree14 16.9 16.9 100.0

Total 83 100.0 100.0


Table 4.20 shows that 33.7% of respondents strongly agreed that MCN responds to

customers/partners needs in creating terms of service delivery, 37.3% agreed, 12.0% disagreed

and 16.9% disagreed. Hence, the respondents agreed that timely response to customers/partners

needs enhances customer loyalty.

Table 4.21: Our company seeks out new ways to do things


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Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 25 30.1 30.1 44.6

Disagree 24 28.9 28.9 73.5

Strongly

Disagree22 26.5 26.5 100.0

Total 83 100.0 100.0


Table 4.21 indicates that 14.5% of respondents were strongly of the opinion that MCN seeks out

new ways to do things. Similarly, 30.1% agreed, and 28.9% strongly disagreed, and 26.5%

strongly disagreed. This implies that majority of the respondents disagreed that MCN seeks out

new ways to do things. The implication here is that MCN still adopts traditional method of

marketing strategy which is monologue in nature.

Table 4.22: Our company frequently tries out new ideas.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 27 32.5 32.5 49.4

Disagree 20 24.1 24.1 73.5

Strongly

Disagree22 26.5 26.5 100.0

Total 83 100.0 100.0


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Table 4.22 shows that 16.9% of respondents strongly agreed that the company frequently tries out

new ideas. 32.5% agreed, 24.1% disagreed and 26.5% strongly disagreed. This also affirms that

MCN is not innovative enough to win competitors’ customers as the company is more

comfortable carrying out marketing activities the same way.

Interview question 2: What can you say about MCN customer loyalty programs?

Management staff response to interview questions 2, 3 and 8: 9 of the managers interviewed

were of the opinion that promotional activities in form of Customer loyalty programs should be

implemented to stimulate consumers buying more of the contents. They also suggested that sales

can be increased through discount pricing strategy or gift items like buy one get one at a

reasonable discount offer, it can build a good atmosphere and increase the sales by attracting

other brand’s consumers or stimulating advance consumption. In addition, 4 of the managers

emphasized that the firm should put the consumers ‘satisfaction in the first place, which implies

that the products should cater for the consumers’ demand and lower the purchasing cost for

consumers. In their opinion, when developing a new product, purchasing power should be taken

into account. Besides, MCN should provide convenience to customers when they are buying.

This implies that distribution network is not effective enough to improve market share. Finally, 6

of the managers posited that MCN should have efficient consumer-oriented communication with

the clients. Users are willing to pay not only because of the attractive programs but also the good

quality services.

Observation V: It was observed that the product development strategy adopted by MCN incurred high cost.

Research question V: What are the benefits of market penetration strategy in the Pay-Tv

industry?


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To answer this research question V, questionnaire items 19-24 in section B and interview

questions 7, 9 and 10 were relevant to the research question.

Table 4.23: The capability to leverage on consumer insights in order to

develop tailored and personalized services to build loyalty.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 33 39.8 39.8 84.3

Disagree 8 9.6 9.6 94.0

Strongly

Disagree5 6.0 6.0 100.0

Total 83 100.0 100.0


Table 4.23 indicates that 44.6% of respondents were strongly of the opinion that penetration

strategy helps firms to leverage on consumer insights to develop personalized services for brand

loyalty. Similarly, 39.8% agreed, 9.6% disagreed and 6.0% strongly disagreed. This implies that

the respondents were in support that penetration strategy helps firms leverage on consumer

insights to develop personalized services for brand loyalty as it involves a dialogue approach and

customer reward programs.

Table 4.24: Direct dealing with the cable operator for customer insight

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage


80

Valid


Agree 36 43.4 43.4 89.2

Disagree 6 7.2 7.2 96.4

Strongly

Disagree3 3.6 3.6 100.0

Total 83 100.0 100.0


Table 4.24 reveals that 45.8% of respondents strongly agreed that penetration strategy provides

opportunity for direct dealing with the cable operator for more customer insights. In like manner,

43.4% agreed, 7.2% disagreed and 3.6% strongly disagreed. This result is an indication that

penetration strategy enables a firm to sell more in existing market by dealing directly with

customers that are not yet aware of the unique features of the product.

Table 4.25: The experience and insight to shape and successfully deliver

partnerships across the industry value chain.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 33 39.8 39.8 81.9

Disagree 13 15.7 15.7 97.6

Strongly

Disagree2 2.4 2.4 100.0

Total 83 100.0 100.0


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Table 4.25 reveals that 42.2% of respondents strongly agreed that penetration strategy enhances

personnel experience to shape and successfully build partnerships across the industry. In like

manner, 39.8% agreed, 15.7% disagreed and 2.4% strongly disagreed. This result is an indication

that distribution channels in form of partners help Pay-Tv to deliver products to remote areas

through penetration strategy.

Table 4.26: Better consumer management system and the ability to offer

targeted content packages to customers.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 36 43.4 43.4 89.2

Disagree 6 7.2 7.2 96.4

Strongly

Disagree3 3.6 3.6 100.0

Total 83 100.0 100.0


Table 4.26 indicates that 45.8% of respondents were strongly of the opinion that penetration

strategy guarantees better consumer management system and the ability to offer targeted content

packages to customers. Similarly, 43.4% agree, 7.2% disagreed and 3.6% strongly disagreed.

This implies that the respondents were in agreement that penetration strategy involves better

consumer management system and loyal customer reward programs.


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Table 4.27: Better and quick response to complaints for increase in market

share

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid


Agree 34 41.0 41.0 81.9

Disagree 9 10.8 10.8 92.8

Strongly

Disagree6 7.2 7.2 100.0

Total 83 100.0 100.0


Table 4.27 indicates that 41.0% of respondents were strongly of the opinion that Better and quick

response to complaints for increase in market share can be achievable through penetration

strategy. Similarly, 41.0% agreed, 10.8% disagreed and 7.2% strongly disagreed. This implies

that quick response to customers’ complaints prevents customer churn thereby retaining and

improving market share.

Table 4.28: Offering of customers’ opportunity to subscribe to channels of

their preference.

Frequency Percentag

e

Valid

Percentage

Cumulative

Percentage

Valid Strongly Agree 33 39.8 39.8 39.8

Agree 35 42.2 42.2 82.0

Disagree 9 10.0 10.8 92.8


83

Strongly

Disagree6 7.2 7.2 100.0

Total 83 100.0 100.0


Table 4.28 reveals that 39.8% of respondents strongly agreed that segmentation of customers

gives the opportunity to offer different program content. In like manner, 42.20% agreed, 10.0%

disagreed and 7.2% strongly disagreed. This result is an indication that through penetration

strategy, customers have choice to subscribe to a program content of preference.

Interview question 7: What can you say about consumer management system in MCN?

Management staff response to interview questions 7, 9 and 10: To have better marketing, 8 of

the 13 managers interviewed suggested free-to-air approach as a form of penetration strategy to

win competitors’ customers thereby increasing market share. Secondly, they were of the opinion

that reward of loyal customers in form of promotional activities will go a long way in retaining

existing market share and attracting new customers. When asked about the customer management

program, 10 of the managers agreed that MCN do not have a perfect feedback from the

customers. As 1 pointed out, to analyze the feedback does good to perfect the arrangement of

programs and marketing strategy as well. They were of the opinion that it is the responsibility of

the service centers to solve challenges associated with usage of product but unfortunately

customers are frustrated by technical challenges such as monthly subscription payment and

reconnection hitches. 1 of the managers noted that service centers make audience feel the human-

oriented service of any Pay-Tv which increases users’ loyalty to it. Also, 2 of the managers

suggested that to improve the situation, MCN should give publicity in different ways; they should

let audience know more about them. Only in this way can they develop better and attract more

audience. When asked if MCN has done enough to sell existing products to far-reaching groups


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in the rural areas, they were critical about the situation. The summary of their responses is that

what MCN has to do now is win trust from audience by positive attitude, good service and

variable choices. Those efforts will help users develop the habit of watching MCN program

content. 1 of the managers tacitly stated that there is nothing wrong in MCN providing one-week

free preview service to improve market share, most importantly on weekends to attract people

who need to go to work or go to school on weekdays to subscribe to Pay-Tv services.

4.4 Summary if findings from data analysis

The analysis above reveals that MCN marketing strategy leaves a gap between customers and the

firm’s program content. The current customers have not been integrated into the company’s

marketing strategy. This gap is created by the pricing strategy implemented by the company

which is higher than that of the competitors without price premium or discount. Again, the

marketing strategy lacks free-to-air program content and loyalty programs to win competitors’

customers. It is also evident that the distribution channels to reach out to customers are not

effective to retain or increase market share. Hence, customers can only buy when products can

easily be accessed. It is evident that MCN needs to incorporate a marketing strategy with

discounts or price premium, free-to-Air program, customer loyalty programs and effective

distribution channels to improve market share.

4.5 Conclusion

This chapter shows the analysis of data collected and also the findings from the survey. The

findings show the perceptions and expectations of staff on the marketing strategy of MCN, the gaps


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and methodology for improvement. The recommendation and options from the analysis will be

evaluated in the next chapter.

CHAPTER FIVE

GENERATION AND EVALUATION OF OPTIONS

5.1 Introduction

In the last chapter, the questions in the research instruments were discussed; the survey responses

were analyzed. The researcher also made some interpretation based on the findings and

observations. In this chapter the findings will be used to generate options from a cost and benefit

perspective and implement the best optimal option using the decision making matrix model, which

will address the MCN marketing strategy defects.


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5.2 Analysis of options

Following the analysis of the survey responses, the researcher has generated four options as

recommendations for gaining sustainable competitive advantage and improving market share of

MCN. The strategic options include:

Option 1: Penetration strategy.

Option 2: Product development strategy.

Option 3: Market development strategy.

Option 4: Diversification strategy.

Option 1: Penetration strategy: Selling existing products into existing markets to gain a higher

market share.

This strategy involves selling more to current customers and to new customers who can be thought

of as being in the same marketplace. The concept is built on the company’s ability to get a bigger

market share in the existing market with its existing products. Success in market penetration

depends on existing customers’ buying more products more frequently, gaining rivals’ business

customers and persuading potential customers who have not purchased from that business yet to

purchase. Penetration strategy involves the firm forming strong relations with customers to increase

purchasing frequency and sales revenue by existing customers’ recommending the business and its

products to their vicinity.

For MCN to adopt penetration strategy, consumers’ satisfaction should be put in the first place,

which means that the products should cater for the consumers’ demand and lower the purchasing

cost for consumers. MCN must combine competitive pricing strategies, advertising and sales


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promotion to attract customers. MCN has to incorporate price premium in the marketing strategy

as the price premium attracts new customers particularly those of lower income group and this

help to increase market share.

Benefits:

1. New customers can be acquired with no cost.

2. Penetration strategy is associated with low risk.

3. It increases market share.

4. It increases usage of product by existing customers.

5. Penetration strategy is used to drive out competitors by making the market unattractive.

Cost of implementation

The option demands that the company incurs cost in training the employees on effective service

delivery and the use of social media for advertising and promotional activities. Rapidly changing

technologies that encourage users to upgrade have to be deployed to offer more reasons to use the

product, and the implementation of reward programs for loyal customers requires budget

allocation. The company is also expected to incur cost in the area of free-to-air content strategy

and price premium strategy in order to attract competitors’ customers. Most important,

information system that is customer friendly has to be purchased in order to achieve customer

self-service and effective interaction with customer service representatives at MCN and Channel

partners’ outlets.

Option 2: Product development strategy: This entails business going into existing markets with

different products and attempt to increase market share.


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This strategy is based on making products and services different and more desirable than the

competitors. The aim of this strategy is to deliver differentiated products and services that have

the ability to deliver high quality. The Product development strategy will incur additional costs in

creating competitive advantage offering different, desirable and high quality products. These

costs will be recovered by offering high price for the products and services to make up for the

high costs incurred. Also unique differentiation is difficult and time consuming to copy by

competitors.

It is important for businesses to develop new products to get competitive advantage. Within the

process of developing new products, being ready for changes, forming project teams, determining

product development stages, efficient auditing and being a learner organization are all required.

Moreover, the process of product development should be evaluated from various perspectives like

preferences of product users, competition level at the market, rival product designs, functional

capabilities of the business, technical superiorities and price determination criteria.

To adopt Product development strategy, MCN has to use existing or new capabilities to introduce

new program content based on the changing needs of customers. This can help the organization to

compete successfully in the market place as new products can create new market opportunities.

Consumers may have to purchase new hardware when switching to the new product. Switching

costs may be high. This is beneficial because low switching costs increases rivalry. When

consumers can freely switch from one product to another, there is a greater struggle to capture

consumers.

Benefits:

1. Changes in research and development function.

2. Desirable and high quality products.

3. New product creation enhances competitive advantage.


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4. New products create new market opportunities.

5. Product development strategy offers the opportunity to completely meet customers’ needs

and thereby fully achieving customers’ satisfaction.


The adoption of this option requires MCN to incur cost in Research and development (R&D) to

introduce new products. The company is expected to incur cost in new technologies and materials

that are needed for product development. Also, training of employees will attract additional cost.

Again launching of a new product through brand extension is expected to attract extra cost.

Product development may require buying an existing product from another manufacturer and

putting company’s own name on the packaging, hence the company is expected to incur a huge

cost in this circumstance.

Option 3: Market development strategy: Taking existing products into new markets.

This strategy involves taking existing products into new markets and this is achieved by

developing new users for the product, exploiting new markets by eliminating agents and deal

directly with customers. Market development strategy depends on the fact that customers prefer

and purchase a business’s existing products in new markets rather than the rival products. For

market development to boost sales, it must be achieved through accessing of new segments and

turning non-users into customers of the business. Therefore, new geographic areas, new

departments with demographic qualities, new institutional markets or market departments with

new life forms might be among the aims of a business. Businesses are in search of new users for

their existing products. The main danger in this strategy is that the brand might fail because it

hasn’t understood customer characteristics, needs and demands adequately and clearly.


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MCN requires more extensive evaluation of market system to adopt market development

approach. Determining the players in the market, their strengths and their roles in the value chain

is crucial. Also, evaluation of the new probable players in the market is necessary during decision

making. Evaluation of existing and potential players is the basis for market-oriented solutions and

decisions of business.

Benefits:

1. Market development strategy boosts sales.

2. New users for the existing products are discovered.

3. It increases market share.

4. The strategy protects company’s price.

5. New market segment is created.


To adopt this strategy, MCN has to incur cost to identify new geographical market, new product

dimensions or packaging. The company is expected to discover new distribution channels or the

creation of a new market segment by means of different pricing. There is also a very high risk of

losing current customers as a result of new market creation. Because this strategy requires

detailed market and competitor intelligence, employees require training in that direction. Also,

well researched market, financial and operational data in the area of Research and development

(R&D) is needed to minimize uncertainty and risk. The company is also expected to incur cost in

new technologies to attract new customers.

Option 4: Diversification strategy: Developing new products for completely new markets.


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Diversification strategy requires using new techniques, new capabilities and qualities for original

products. It also necessitates physical and organizational changes in the business structure and

bears very different characteristics than its past experience. With diversification strategy, a

business can perform different activities in various industries in the long-term. The business,

however, should be careful in this process while deciding which activities to sustain and which

ones to quit. Characteristics of diversification strategy are effective on the corporate structure and

contribute to formation of a decentralized structure.

For MCN to employ diversification strategy, it must make an honest assessment of the risks

involved. Diversification often fails because organizations that attempt it are always desperate to

reinvent themselves. It is associated with very high risk.

Benefits:

1. Long term future business than the current business.

2. Encourages economies of scale.

3. Performance of various activities in other industries.

4. It enhances decentralization of production structure.


The adoption of this option requires incurring very high cost in developing new product for

completely new market. It also takes a considerable time to accomplish. This strategy also

demands the acquisition of new technology for new product. In addition to its high risk tendency,

employees need training in the new line of business.


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Assessment of strategy options

OPTION 1: Adoption of penetration strategy.

OPTION 2: Adoption of product development strategy.

OPTION 3: Adoption of market development strategy.

OPTION4: Adoption of diversification strategy.

Table 5.1: Unweight assessment of each option

Factors Cost Benefits Risk Timeline Total

Options

1 4 7 2 2 15

2 3 6 3 2 14

3 4 5 4 2 15

4 2 3 5 2 12

Payoffs range from 1-10

Table 5.2: Weighted assessment of each option


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Factors Cost Benefits Risk Timeline Total

Weights 6 8 2 3

1 24 56 4 6 90

2 18 48 6 6 78

3 24 40 8 6 78

4 12 24 10 6 52

Weight assigned in order of priority (1-10)

5.3 Selection and recommendation

The Matrix Decision model above reveals that the optimum strategy/option is option 1 with the

largest total payoff. Hence, the researcher recommends that MCN adopts Penetration Strategy as

a marketing strategy for improving market share.

5.4 Conclusion

This study identified four major options of marketing strategy. From cost and benefit perspective,

Deterministic matrix decision model was used to select the best option with optimum pay off;

option 1, having the highest payoff was selected. The researcher hereby proposes penetration

strategy which involves selling existing products into existing markets to gain a higher market

share. Through discount pricing strategy or loyalty programs such as giving gift items like buy


94

one get one at a reasonable discount offer and free-to-air strategy; competitors’ customers can be

attracted thereby boosting market share. However, a customer will not likely purchase a product

unless it can be relatively easily accessed. Hence, effective distribution channels and reward of

customer loyalty programs in form of sales promotion are to be implemented in order to improve

market share. In the next chapter, the implementation of the preferred option, challenges and

problems associated with it are discussed.

CHAPTER SIX

CONCLUSION AND IMPLEMENTATION

6.1 Introduction

The last chapter identified and evaluated the options generated. The selection and recommendation

of option was also discussed. This chapter discusses the implementation of the preferred option, the

researcher’s reflection and the conclusion of this research work.

6.2 Conclusion


95

Due to the powerful effect of competition, business executives aim to grow by adding additional

values to existing products, launching new products and acquiring new markets (Porter, 1996).

With competition growing daily, it is increasingly important to exercise a good marketing

strategy. Without a basic marketing plan, there is simply no way to determine whether today’s

demand which a firm have come to depend on will be available tomorrow.

Kotler and Keller (2009) posited that a firm’s marketing strategy can only be described as optimal

strategy in terms of the firm’s market share in relation to market leaders in the industry. The

customer base is the hub of every business because without customers there simply would be no

business. Kotler and Keller noted that loyal customers are satisfied customers and that satisfied

customers are least expensive customers; buy again and again; talk favorably about business,

which means free advertising, pay less attention to competitors and tend to buy new products or

equipment lines the company may add later. Cilley (2011:32) stated that the market penetration,

product development, market development and diversification strategies in Ansoff matrix give

businesses cost efficiency and provide them with the best growth opportunities. Any use of price

reductions, expanded distribution in the current market, sales force effort or promotions would be

ways to implement a market penetration strategy.

A company’s strategy is therefore said to be an effective strategy if there are clear differences

between the competitors and if these differences lead to positive consequences for the consumers.

Hence, this study revealed that MCN can improve its market share which is on the decline by

adopting penetration strategy with the lowest risk. To adopt penetration strategy in Pay-Tv

industry, MCN is expected to implement free preview of content or free-to-air content strategy,

price reductions or discount, expanded distribution in the current market, reward of loyal customers

through promotions, dialogue marketing and forming strong relations with customers to increase

frequency of purchase. Also, due to budget limitation, MCN does not have lots to spend on

marketing communication efforts; hence the best way to promote program content is to use Social


96

media. Social media provides cost effective means of advertising for free. Moreover, it can help

build reputation and create great awareness and exposure.

6.3 Implementation Plan

The implementation of the selected option will be based on the decision of the management of

MCN. A presentation on this research work will be made to management addressing the MCN

consistent decline in market share and the marketing strategies that can be used to improve the

market share vis-a-vis costs, benefits and risks associated with each strategy. Penetration strategy

will be proposed to the management as an effective marketing strategy to win competitors’

customers in the industry. The implementation plan for penetration strategy in order to gain

competitive advantage is presented on the table below.

Table 6.1: Implementation for penetration strategy option.

S/N ACTION PLAN INSTRUMENTS RESPONSIBILITY

(ANCHOR-PERSON)

COST

IMPLICATION

ACHIEVEM

ENT DATE

1 Identify and analyze

the business

problem: access the

marketing strategy

and deficiency in the

strategy that resulted

in customer churn

Dissertation survey

and interviews;

MCN’s vision,

mission and core

values.

Researcher, Middle

Management

Organizational Team

Members.

Nil May 1, 2015.


97

and market share

decline.

2 Identify the

Competition:

To analyze the

competitive

landscape, it is

necessary to make a

list of those

competitors that

compete directly or

indirectly with the

MCN’s

Products or services

by providing the

same products or

services to the

customer.

Dissertation

workshop extracts,

competitive

intelligence reports

from marketing

unit, MBA

textbooks and

journals.

Researcher, Sales and

Marketing Managers

and Consumer Insight

Manager.

Nil May 10,

2015.

3 Identify the

Competitors’

Strategies:

Analyzing the

competitors’

strategies provides

Dissertation

workshop extracts,

competitive

intelligence reports

from marketing

unit, MBA

textbooks and

Researcher, Sales and

Marketing Managers

and Consumer Insight

Manager.

May 20,

2015.


98

the firm an

indication of current

trends in the

industry. This helps

the firm determine

how to approach the

customer.

journals.

4 Submit Dissertation

(assessed by BSN

internal examiner) to

management,

communicate the

marketing strategy

and build a strong

coalition with

management.

Dissertation Management at all

levels and the

Researcher.

Nil May 30,

2015.

5 Identify the cost

implication plan,

develop and

implement market

penetration strategy

with effective

distribution channels

to make products

easily accessed by

customers.

MCN’s vision,

mission, objectives,

promotional tools

and social media

tools.

Top Management,

Channels Development

Team Members and

Researcher.

$5,000.00 June 15,

2015.


99

6 Train and empower

the employees on

the new marketing

approach,

promotional and

social media tools

and how to run an

effective loyalty

program.

MCN’s mission,

vision, Dissertation,

promotional tools

and social media

tools.

Middle Management

Organizational Team

members, Learning and

Development Unit,

Researcher and

Strategic Consultants.

$15,000.00 June 30,

2015.

7 Evaluate the

components of

market penetration

strategy (pricing,

loyalty programs,

distribution

channels, free

preview and social

media tools) to

regularly identify

deviations and

correct them to

boost competitive

advantage. Most

importantly to

attract competitors’

customers.

MCN’s vision,

mission, objectives,

marketing tools and

social media tools

and score card.

Top Management,

Organizational Team

Members, Human

Resources Unit and

Researcher.

$2,000.00 July 30, 2015

and every

other Quarter

of the

financial year.


100

6.4 Challenges and problems

Presumably, the researcher envisages some problems that might occur during the implementation

of the selected option. It will take time and cost money (22,000 USD) to fully implement

penetration strategy which comprises promotional tools, social media tools and integration of

customers’ views. Secondly, penetration strategy requires a firm to identify new demographic for

the existing product and market which is expected to take some time. Again, although the risk

associated to penetration strategy is relatively low, the firm must not compromise the quality of

the existing product in order to sell more to the existing customers. Also, employees need

continuous training on the complaint handling, service delivery and maintenance of product

facilities to minimize customers’ frustration on the product’s usage. Penetration strategy

undoubtedly requires aggressive promotional campaign supported by a pricing strategy designed

to make the market unattractive for smaller competitors. Since a successful market penetration

strategy relies on detailed knowledge of the market and competitor intelligence, employees

require training to be abreast of the market trends. Moreover, it is anticipated that the

organization will face challenges in the area of deploying rapidly changing technologies that will

encourage users to upgrade or that will offer more reasons to use the product. Time will also be

required to get the cost implication approved and convince management on why the selected

option should be implemented. The main challenge with this strategy is that with a mature market

like the Pay-Tv industry where there is little or no demographic sectors to exploit, the only way to

improve market share is to take it from competitors. However, the strategy is associated with

relatively very low risk, low cost, time bound and relatively easy to adopt.


101

6.5 Input control measures

An assessment of market situation of MCN should be done in terms of market share or

turnover periodically to ascertain the impact of the adopted strategy.

The management should be aware of the influence of loyalty programmes (reward of

loyal customers) and how it has affected the market share. This awareness will guide

them in improvements in decision-making and hence improves the company market

position.

The marketing department should consistently be abreast of the competitors’ strategy by

assessing and tracking competitors.

The implementation of loyalty programs in form of gift items must be monitored to

ensure that customers benefit from such programs.

The marketing communication plan must focus on reaching the customers in the industry

who are not yet aware of MCN products.

The employees of the company especially the customer care unit must be monitored to

improve complaint handling by requesting for feedback from both existing and

prospective customers.

6.6 Critical success factors

It is expected that the sustainability of this strategy (penetration strategy) would be a primary

focus of the management team to ensure that customers are attracted and retained. This can be

achieved through image or reputation and high switching cost. In addition, for MCN to have a

competitive advantage in a Pay-Tv industry, it must avail the customers the opportunity to

consume different types of content and having control over television content. Also, discount

pricing strategy and free preview to attract competitors customers are suggested as critical


102

success factors. Hence, the employees of the company need training on integration of customers

views to adopt a dialogue approach in marketing strategy. Again, effective distribution channels

are needed to make MCN products accessible to customers. Also, seasoned technologies will help

to tie products to customers who are exposed to modern technologies.

6.7 Conclusion

This chapter discussed the implementation plan of the preferred option, challenges and problems

envisaged in the course of the implementation. The researcher’s reflection on the entire research

process, procedures, findings and conclusion are highlighted in the next chapter.


103

CHAPTER SEVEN

REFLECTION

This research is an interesting source of learning for firms in the Pay-Tv industry who want to

improve market share in a mature market where the feasible option is to win over competitors’

customers to gain a higher return on investment (ROI).

The questionnaire revealed to the researcher the marketing strategy currently adopted by MCN

which is ineffective in increasing profitability and market share of MCN.

This study provided an in-depth theoretical and practical understanding of market penetration

strategy vis-a-vis other growth strategies such as product development strategy, market

development strategy and diversification strategy. A more contextual and detailed picture of the

effect of current marketing strategy adopted by MCN was given. Hence, the gaps caused by

ineffective product development strategy in MCN were identified which include loss of market

share, ineffective distribution channel, monologue approach to marketing among others.

Having examined the features of different growth strategy, market penetration strategy is

recommended for MCN to solve the problem of market share decline. The researcher’s


104

observation, respondents’ opinion and responses to the research questionnaire and interview

questions were analyzed to form a foundation upon which effective competitive strategy is

formed.

This study is an addition in the field of marketing strategy and this include;

• Gaining greater insight into forms of marketing approaches to marketing strategies and to

know when to apply market penetration strategy.

• Getting a better Understanding of price premium and loyalty programs to gain competitive

advantage.

• Improving research skills and overall personal effectiveness of the researcher and the

Research and Development (R&D) team to provide qualitative consultancy services on market

share gains.

The study was necessitated by the constant decline of MCN market share thereby drawing the

attention of the researcher to embark on the study of the best marketing strategy to improve

market share of MCN.

The findings from the research work revealed that MCN will not only retain its market share and

gain competitive advantage in a mature market like Pay-Tv industry through market penetration

strategy but attract competitors’ customers thereby improving its market share. The penetration

strategy consists of inter-related marketing activities which include customer loyalty programs,

dialogue approach to marketing to integrate customers’ perceptions and views, free preview or free-

to-air strategy, discount pricing strategy, effective distribution channels and deployment of social

media tools to tie customers to the existing products.

The study provided the researcher the opportunity to access the researcher’s ability to withstand

academic and work pressure which helped improve the time management skills of the researcher.


105

The study was quite insightful, worthwhile and broadened the researcher’s critical reasoning

ability.

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APPENDIX I - QUESTIONNAIRE

Dear Respondent,

This questionnaire is designed to give you the opportunity to examine market penetration as a

strategy to improve market share in MCN. The researcher is therefore soliciting for your

assistance in completing the questionnaire exactly the way marketing strategy is adopted in your

company and not the way it ought to be. All information made available will be treated in strict

confidentiality and will be used mainly for academic purposes.

Thanks for your anticipated co-operation.


116

Akintoye Akamoh.

SECTION A

Instruction: Kindly tick () where applicable

RQ1

1. Gender: (a) Male [ ] (b) Female [ ].

2. Age: (a) Below 25 years [ ] (b) 26 – 30years [ ] (c) 31 – 40 years [ ] (d) 41 and above

3. Highest Educational Qualification: (a) SSCE/WASC [ ] (b) OND/NCE [ ] (c) HND/

B.SC/B.A [ ] (d) M.Sc./MBA [ ].

4. Years of Experience in this organization: (a) 1 – 5 years [ ] (b) 6 – 10 years [ ] (c) 11 -15.

SECTION B

Kindly indicate the extent of your agreement with the statement below by ticking [√] one of the

spaces provided. Where: SA=Strongly Agree; A =Agree; D=Disagree while SD =Strongly

Disagree.

S/N RESPONSE VARIABLES SA A D SD

RQ2 What is the marketing strategy that is adopted in MCN?

1 Development of market oriented strategy.

2 Implementation of market oriented strategy.

3 Collection and use of market information.

4 Collection and use of customer information to improve quality of


117

products and services.

5 Free-To-Air content strategy to attract competitors’ customers.

6 Marketing Strategy based on the strengths of the Company to

provide customer needs.

RQ3 What are the challenges that hinder increase in market share

in MCN?

7 Company planning is organized around markets rather than

products or

Services.

8 Company personnel do not have adequate information about

customers and

Competitors.

9 MCN does not obtain ideas from customers to improve products

and services.

10 MCN Focuses on areas in which the company has competitive

strength.

11 MCN does not Keep promises made to customers.

12 MCN is not creative in its methods of operation.

RQ4 What are the approaches to market penetration strategy that

can be adopted in MCN?

13 The Company values market position more than financial


118

performance.

14 MCN Allows Prices to be determined by customer value which

improves market position.

15 .

Adoption of Free-To-Air contents, especially sports and movies

enhances market share.

16 Responds to customer needs in creating terms of service delivery.

17 MCN seeks out new ways to do things.

18 MCN frequently tries out new ideas.

RQ5 What are the benefits of market penetration strategy in the

Pay-Tv industry?

19 The capability to leverage on consumer insights in order to

develop tailored and personalized services to build loyalty.

20

Direct dealing with the cable operator for customer care.

21 The experience and insight to shape and successfully deliver

partnerships across the industry value chain.

22 Better Consumer Management System and the ability to offer

targeted content packages to customers.

23 Better and quick response to complaints for increase in market

share.

24 Offering of customers’ opportunity to subscribe to channels of

their preference.


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APPENDIX II - STAFF INTERVIEW GUIDE

In-depth interview guide used for evaluating MCN marketing strategy

Interview questions

1. What can you say about MCN Marketing Strategy?

Is it a monologue approach or Dialogue approach?

2. What can you say about MCN customer loyalty programmes?

Are loyal customers rewarded periodically?

3. What can you say about the audience of a new product?

Do Customers have a good idea of MCN programme content through traditional

marketing efforts in practice?

4 Do you think MCN marketing strategy reduces cost whilst increasing efficiency and

message for each of the channels based in locations?


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5. What can you say about MCN market share decline?

Is it as a result of ineffective loyalty programmes? Explain.

6 Do you think prices charged for contents at MCN are worth it?

If no, would you recommend Free-To-Air contents as a strategy?

7. What can you say about consumer management system in MCN?

Are the existing customers adequately managed in terms of complaints handling?

8. In your own opinion, do you think MCN pricing strategy is competitive enough to attract

competitor’s customers?

9. How effective is MCN advertising and sales promotional strategy? Explain

10. Do you think MCN has done enough to sell existing products to far-reaching groups in

the rural areas? Explain.


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APPENDIX III – OBSERVATION CHECKLIST

Classification of observations made in MCN

Items assessedYes/No

RQ1

Social- demographic data employees in MCN

Qualified employees Yes

Experienced employees Yes

RQ2

Marketing strategy adopted by MCN

Market penetration No

Product development Yes

Market development No

Diversification No

RQ Challenges that Loyalty program No


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3hinder increase in market share in MCN

Discount pricing strategy No

Effective distribution Channels NoFree preview No

effective communication with customer No

RQ4

Approaches to market penetration strategythat can be adopted in MCN

Increase or retain of market share NoGrowth market domination NoDriving out competitors No

Increase in customer usage No

RQ5

Benefits of market penetration strategy in the Pay-Tv industry

Increase in usage of product NoLow risk NoLow cost NoNew customers can be acquired at no cost No


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Documents

USING MARKET PENETRATION STRATEGY TO IMPROVE MARKET SHARE OF MCN