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The Effects of Information Technology on the Marketing of Consumer Goods
Chapter One
Introduction
1.1 Background to the Study
The chief goal of any business organization is to make profit. Following
the goal of profit making is to keep being in business and gaining more and
more share of the market – growth. Every activity of a business organization is
geared towards the success of the organization. Mullins (2002) opined that “in
order to be successful, the primary objectives of the business organization may
be seen as: a. to continue in existence – that is, to survive; b. to maintain
growth and development; and c. to make profit. All three objectives are
inextricably linked and it is a matter of debate whether the organization
survives and develops in order to provide a profit, or makes a profit by which
it can survive and develop. If we accept survival as the ultimate objective of
the business organization, then this involves the need for a steady and
continuous profit.” In his own words, Drucker (1989) suggested that “the first
responsibility (of a business organization – mine emphasis) is to operate at a
profit, and only slightly less important is the necessity for growth. The
business is the wealth-creating and wealth-producing organ of our society.
Management must maintain its wealth producing resources intact by making
adequate profits to offset the risk of economic activity. And it must besides increase
the wealth-creating and wealth producing capacity of these resources and then
the wealth of society.” It is just pertinent to note here that the business
organization can keep being in business only by perpetual profit making. In
view of the objectives of profit making, growth, and continuous existence of a
business organization, many inventions keep evolving to help business
organizations achieve their objectives. Chief among these inventions, and
perhaps, the most recent, is information technology. Simply put (in a layman’s
definition), information technology is the use of computer-based (or
electronic) devices to gather, process, and disseminate information.
Information is very critical to the survival of any business organization. It
is not enough for a manager to know how and where to get the right information,
it is important for managers to know the techniques for controlling and
processing information. This is referred to as ‘manage information’ which
describes the manager’s role in obtaining, analyzing, and using information
effectively to take decisions. According to Kotler and Armstrong (2001), a
century ago, most companies were small and knew their customers firsthand.
Managers picked up marketing information by being around people, observing
them, and asking questions. In more recent times, however, many factors have
increased the need for more, better, and faster information. As companies
become national or international in scope, they need information on larger,
more distant markets. As incomes increase and buyers become more selective,
sellers need better information about how buyers respond to different products
and appeals. As sellers use more complex marketing approaches and face more
competition, they need information on the effectiveness of their marketing
tools. Finally, in today’s more rapidly changing environments, managers need
more up-to-date information to make timely decisions. Developments in
information technology have caused a revolution in information distribution.
With recent advances in computers, software, and telecommunication, most companies
have decentralized their marketing information systems. Hitt, Ireland and
Hoskisson (2003) noted that, “the internet provides an infrastructure that
allows the delivery of information to computers in any location. Access to
significant quantities of relatively inexpensive information yields strategic
opportunities for a range of industries and companies. Retailers, for example,
use the internet to provide abundant shopping privileges to customers in
multiple locations.” Developments in the technical systems of communications
such as international telephone connections and the increasing use of faxes,
mobile telephones and email generating a working climate in which there is a
greater expectation of immediacy of receipt and response; and adding to the
dangers of information overload. Consistent with this research priority, this
paper tries to build on previous research on information technology by
examining the effects of information technology on the marketing of consumer
goods. Specifically, this study seeks to develop and test a normative process
model with sales and financial data collected from the Cadbury Nigeria PLC.
Cadbury Nigeria is a major and front-lining consumer packaged goods (CPG)
company in Nigeria.
NB: The Complete Thesis is well written and ready to use.
