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(A SURVEY OF HEALTH/TRANSPORTATION SERVICES IN RIVERS STATE)
Abstract
The study examined price sensitivity and client buying behaviour of selected service. The main objective of the study is to examine the relationship between Service quality and client buying behavior of selected health/transport services in Rivers State, understand the influence of tariff on client buying behaviour of selected health/transport services in Rivers State and examine the effect of innovativeness on client buying behaviour of selected health/transport services in Rivers State. The descriptive survey was adopted. The judgmental sample technique was adopted. The primary and secondary source of information was used. A self design questionnaire was con structured on a five like scale. The sample size is 120, data were collected with the used of questionnaire. The research questions were analysed with mean and standard deviation while the hypotheses were analysed with pearson product moment correlation co-efficient. The finding of the study shows that, there is a significant relationship between price sensitivity and client buying behavior organisation strategy and goals impacts innovation and innovation is determined by organisation culture. There is a relationship between price sensitivity and client buying behavior. Based on the finding, it is recommended that firms in the health/transport services should ensure they deliver quality service such as can enhance customer retention and increase patronage, management should ensure that there are varieties of tariffs for consumers to make choice from. This will help shape client behavior to remain with the organization and Since innovators play a crucial role in the diffusion of the products. Firm should ensure that new product and services are introduced with new ideas that can move consumers to purchase or use the services.
Table of Contents
Cover Page i
Title Page ii
Declaration iii
Certification iv
Dedication v
Acknowledgements vi
Abstract vii
Table of Contents viii
List of figure xi
CHAPTER ONE 1
INTRODUCTION 1
1.1 Background of the Study 1
1.2 Statement of the Problem 3
1.3 Objective of the Study 4
1.4 Research Questions 4
1.5 Research Hypothesis 5
1.6 Significance of the Study 5
1.7 Scope and Delimitation of the Study 6
1.8 Limitations of the Study 6
1.9 Definition of Terms 7
CHAPTER TWO 8
REVIEW OF RELATED LITERATURE 8
2.1 Conceptual Review 8
2.1.1 Concept of Price Sensitivity 8
2.1.2 Dimensions of Price Sensitivity 12
2.1.3 Concept of Client Buying Behaviour 14
2.1.4 Measures of Client Behaviour 15
2.1.5 Price Sensitivity and Consumer Behaviour 18
2.2 Theoretical Framework 19
2.3 Review of Related Empirical Studies 20
2.4 Summary of Review of Related Literatures 23
CHAPTER THREE 24
RESEARCH METHODOLOGY 24
3.1 Research Design: 24
3.2 Population of the Study: 24
3.3 Sampling Techniques Used 24
3.4 Sample Size 25
3.5 Source of Data 25
3.5.1 Primary Source (s) of Data 25
3.5.2 Secondary Source of Data 25
3.6 Research Instrument for Data Collection 25
3.7 Validity and Reliability of Instrument 26
3.8 Techniques for Data Analysis/Test of hypotheses 26
CHAPTER FOUR 28
DATA PRESENTATION AND ANALYSIS 28
4.1 Questionnaire Distribution and Retrieval: 28
4.2 Data Analysis and Presentation 29
4.3 Descriptive Statistical Analysis 30
4.4 Hypotheses testing 33
4.5 Discussion of Findings: 35
CHAPTER FIVE 37
SUMMARY, CONCLUSION AND RECOMMENDATIONS 37
5.1 Introduction 37
5.2 Summary 37
5.3 Conclusion 37
5.4 Recommendations 38
REFERENCES: 39
Appendix I 42
Appendix II 43
List of Tables
Table 4.1: Questionnaire Administration and Retrieval 28
Table 4.2: Table: Age of respondents 29
Table 4.3: Sex of respondents 29
Table 4.4: Academic qualification of Respondents 30
Table 4.5: Service Quality and Client Buying Behaviour 30
Table 4.6: Tariff and Client Buying behaviour 31
Table 4.7: Innovativeness and Client Buying Behaviour 32
List of figure
Fig2.1: A Conceptual framework showing the relationship between Price 8
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Consumer buying behaviour signifies more than just the approach of consumer towards buying a product. Marketing efforts therefore also emphasize on consumer’s consumption of services, ideas and activities. The manner in which consumers buy a product is extremely important to marketers. Consumer buying behaviour means more than just how an individual buys products. Marketing efforts therefore also focus on consumer’s consumption of services, his activities and ideas. It explains the set of decisions that a consumer makes while buying (Hoyer, 2004). It is important to know consumer reaction towards different products, their features, price, and advertisement pattern, in order to ensure strong competitive advantage.
Consumer buying behaviour is the process involved when individuals or groups select, use, or dispose products, services, ideas or experiences (exchange) to satisfy needs and desires. Consumer behaviour is the scientific learning of how people buy, what they prefer to buy, when they need to buy and why they buy i.e. the reason to buy. It mingles elements from psychology, anthropology, sociology, and economics. It makes an effort to understand the buyer decision processes or the buyer decision making process, both individually and in groups. It examines special characteristics of individual consumers such as demographics, psychographics, and behavioural variables in an attempt to understand the needs of the people. It also tries to assess influences on the consumer with the help of groups such as family, friends, reference groups, and society as a whole. One construct that can influence consumer buying behaviour is price sensitivity. Price sensitivity is one of the key factors affecting to in Rivers State pricing choices as well as its ultimate profitability. Nowadays, customers are well informed about product or service alternatives, product benefits, features, qualities and prices through advertising, family members, peer groups, opinion leaders, social networks, public information sources, and newspapers.
Price sensitivity is an individual difference variable describing how individual consumers show their reactions to changes in price levels. Price Sensitivity is the awareness of the consumers to what they perceive about the cost within which they will buy a particular product or service. Each customer will have a certain price acceptability range and different customers have different limits in their perceptions of what price is within their ranges. Customer perceptions of price and their responses to price indicate whether a market is very price sensitive or not. Generally, marketers and researchers are familiar with the concept of price elasticity. If the changes in price have a proportionately greater impact on demand for a product then it is known as elastic demand. On the other hand, inelastic demand narrates the situation where changes in price have a little effect on the demand. The concept of price elasticity illustrates the aggregate response of a market segment to price levels. Pricing strategies and buyers’ responses to prices have received a great deal of scholarly attention (e.g. Monro, 1990; Nagle, 1987), but most of these researches have focused on the aggregate response of the market, price elasticity, and not on individual consumer behaviour (Gatignon, 1984; Kanetkar et al., 1992). From the foregoing therefore, the study seeks to examine the relationship between price sensitivity and client buying behaviour of selected health/transport servicess with reference to health/transport services in Rivers State.
1.2 Statement of the Problem
Surprisingly, it appears that the consumer behaviour could also dampen price sensitivity by enabling customers to find products that best fit their needs. Alba et al. (1997) propose that when quality related information is important to customers and brands are differentiated, interactive retailing could lead to lower price sensitivity. Lynch and Ariely (1998) conducted experiments in a simulated consumer behavior on stores to test this hypothesis. They report that price elasticity was lower under experimental conditions where shoppers had information on both price and product quality as compared to conditions where shoppers had information only on price.
From a practical point of view, just being aware of price reduction or increase does not have to lead to the change of buying habits. Moreover, Weber’s fraction should vary depending on the customer, product and many other situational elements. However, the correct management of customers’ price perception can lead to improved value perception of the products and increased willingness to buy (Varki et al., 2001). Therefore sales managers are not as much concerned with the just noticeable difference, as with the change in price that would motivate the customers to change their purchase decisions. This is the main issue being explored in this study, with a purpose to serve the marketers in analyzing the market and setting the prices for their products. This research is focused not only on looking for the most probable price sensitivity that would induce the consumer behavior. The study seeks to examine price sensitivity and consumer buying behavior of health/transport services in Rivers State.
1.3 Objective of the Study
The main objective of the study was to examine the relationship between price sensitivity and client buying behaviour of selected health/transport services in Rivers State. In specific terms, the study seeks to:
1. Understand the relationship between Service quality and client buying behavior of selected health/transport services in Rivers State.
2. Understand the influence of tariff on client buying behaviour of selected health/transport services in Rivers State.
3. Examine the effect of innovativeness on client buying behaviour of selected health/transport services in Rivers State.
1.4 Research Questions
In course of this research, the following research question enhanced the conduct of this research work.
1. Are there any relationship between Service quality and client buying behavior of selected health/transport services in Rivers State?
2. Does tariff influence client buying behaviour of selected health/transport services in Rivers State?
3. Does innovativeness enhance client buying behaviour of selected health/transport services in Rivers State?
1.5 Research Hypothesis
In the conduct of this research, the following research hypotheses will be used:
HO1: There is no significant relationship between Service quality and client buying behavior of selected health/transport services in Rivers State.
HO2: Tariff does not influence client buying behaviour of selected health/transport services in Rivers State.
HO3: There is no significant relationship between innovativeness and client buying behaviour of selected health/transport services in Rivers State.
1.6 Significance of the Study
The consumer as the focal point of the marketers is very complex and technical in his/her buying behaviour. Probing into the complexity and technicality will result into useful dues about the consumer, which would be of greater interest to the marketers, manufacturer, and other interest groups like the government and the academicians. These will enable the marketer to recover new product opportunities or new ways of promoting existing product.
From the foregoing, it is believed that the completion of this work will provide empirical material on the relationship between price sensibility and client buying behaviour. Also, it is believed that the work will serve as a stepping stone for future researcher as it will provide useful materials for their studies.
In another development, the result of this study will also guide marketers on the relationship between price sensibility and client buying behaviour. This simply means that it will enable them to develop strategies that can foster their client buying behavior which in turn will enhance sales performance of the firms.
1.7 Scope and Delimitation of the Study
The study is delimited under the following heading: content scope, geographical scope and unit of analysis.
Content Scope: The content scope of this study involves an investigation to ascertain the relationship between price sensitivity and client buying behavior of selected health/transport services in Rivers State. The dependent variable is client buying behavior, measured by social factor, cultural factor and demographic factor. While independent variable is price sensitivity measured by service quality, tariff and innovativeness.
Geographical Scope: This study is delimited in Port Harcourt Metropolis with reference to Health and transport services. The study limits scope to selected health and transport services which include RTC Waterlines, Calculux Elelenwo, Alphonso Hospital Elelenwo and Obio Cottage hospital Oginigba.
Unit of Analysis: The unit of analysis in this research involves both senior and Junior staff of the selected health/transport services firms at the time of the study.
1.8 Limitations of the Study
In course of carrying out this research, the researcher met with a lot of constraints. Among these constraints is: The time frame which this research was expected to be completed which was too short.
Secondly, the cost in carrying out this research work act as a barrier as we were not financially buoyant to carry out all investigation.
Finally, assembling the relevant materials needed this work was a problem. It is difficult due to the fact that some of the respondents were not willing to give us the required coorperation.
1.9 Definition of Terms
Client Buying Behaviour: Consumer behaviour is the study of how individuals group and organization select, buy, use and dispose of goods and services, ideas or experiences to satisfy their needs and wants.
Cultural Factors: Cultural, sub-culture, and social class are particularly vation and adopt their marketing strategies accordingly
Demographics Factor: Demographics are clearly tied to subculture and segmentation. However, we shift our focus from analyzing specific subcultures to trying to understand the implications for an entire population of its makeup.
Innovativeness: A firm’s propensity and capability to rapidly incorporate change in business practices through creation and/or adoption of new ideas, that add value in the form of increased competiveness and sustainability.
Loyalty: The quality of being loyal.
Price Sensitivity: Price sensitivity is the degree to which the price of a product affects consumers’ purchasing behaviors.
Service Quality: An assessment of how well a delivered service conforms to the client’s expectations. Service business operators often assess the service quality provided to their customers in order to improve their service, to quickly identify problems, and to better assess client satisfaction.
Social Factors: In addition, to cultural factors, social factors such as reference group, family and social roles and status affects our buying.
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