PROJECT TOPIC- UTILISATION OF E-COMMERCE MARKETING COMPETENCIESBYPHARMACEUTICAL BUSINESS OPERATORS IN ANAMBRA AND IMO STATES OF NIGERIA
This study was undertaken to determine the utilization of e-commerce marketing competencies by pharmaceutical business operators in Anambra and Imo States of Nigeria. Five categories of e-commerce marketing competencies namely: webpage marketing competency, database marketing competency, transactional marketing competency, relationship marketing competency and network marketing competency were studied. The study was carried out in Anambra and Imo States. The population for the study comprised 279 Pharmaceutical Business Operators from the two States. An analysis of a preliminary study of randomly selected 30 pharmaceutical business operators in the studied areas revealed that the pharmaceutical business operators are aware of the identified e-commerce marketing competencies. Five research questions and five null hypotheses guided the study. No sample was taken in view of the manageable size of the population. The study adopted a survey research design and a structured 87 item questionnaire with five response categories on the degree of utilization was used for data collection. The instrument was validated by five experts from the academic and technical units of two universities and a pharmaceutical industry. To determine the reliability, the instrument was trial tested by administering the questionnaire to 20 pharmaceutical business operators in Port Harcourt, Rivers State that
has close proximity and a common boundary with the States under study. The internal consistency was determined using Cronbach Alpha reliability method for each of the five clusters and the result was 0.83, 0.88, 0.86, 0.91 and 0.84 respectively. The overall reliability coefficient of the instrument was 0.92. The returned questionnaires were 267 constituting 90 percent of the targeted population. Mean and standard deviation were
used to answer the research questions. Student t-test statistic was used to analyse the first two null hypotheses involving gender and location at 0.05 level of significance. The next group of hypotheses involving years of experience in the business, educational qualifications and ownership of business were equally analysed using Analysis of Variance (ANOVA) statistic as they involved three variables in each case at 0.05 level of
significance. The result of the study revealed that while relationship marketing competencies was identified as highly utilized, all other e-commerce marketing competencies were found to be utilized at low extent leaving a far reaching implication for marketing education and pharmaceutical businesses in Nigeria. It was recommended among others that institutions offering marketing education should, as a matter of urgency, review their curriculum contents to fall in line with current development in marketing education as this will help the lecturers teach properly and the graduates acquire the right knowledge and skills. The result of the tested null hypothesis proved that there was no significant difference in the mean ratings of the opinions of Anambra State-based and their Imo State-based pharmaceutical business operators on the extent of
utilisation of e-commerce marketing competencies in Anambra and Imo States of Nigeria. There were, however, significant differences in all the other tested variables in the study namely gender, years of experience in the business, educational qualifications ownership of business.
Background of the study
Electronic Commerce (E-commerce) marketing is the exchange of goods and services using internet resources and this involves any business transaction that takes place by means of digital process. Agomuo (2005) stated thatthe success of the virtual workplace and telecommuting depends, in part on any organisation’s ability to do business electronically. Since it holds true that production of goods and services is not complete until they get to the final consumer, the speed required to reach the consumers scattered all over the local and international markets in the present dispensation, can only be achieved through the use of modern electronic technologies. Once the World Wide Web is established, the web store can expand one’s market area to national and international levels.
E-commerce boosts exchange of goods and services in contemporary marketing practices. Contemporary marketing practices refer to modern day technology-driven marketing practices as against the olden days marketing practices that were less technology-driven, and hence tagged traditional marketing practices. The prevailing fundamental traditional marketing practices that are generally in vogue are giving way to emerging contemporary marketing practices and e-commerce is at the centre stage of this development.
Present expectation is that the traditional marketing practices should give way to more modern practices in the areas of identifying the market, segmenting the market, increasing customers’ base and several other business facilitations involving development and distribution of goods and services, and these must be technology driven.
Technology is a form of knowledge that uses concepts and skills from science and the application of this knowledge to meet identified needs or solve specified problems using materials, energy, tools and computers (Obayi, 2006). Technology refers to the tools people and organisations apply to operations to get things done more quickly, more easily or more efficiently. Technology facilitates information dissemination. Information occupies a strategic role in the scheme of human existence; through communication of information development is facilitated. Agomuo (2005) refers to information as facts, instructions and processed data that have been organised in any form which should be meaningful to the end users or recipients. When information is shared interchangeably, communication is said to have taken place.
Communication is transactional and symbolic and involves relating and managing the environment for the purpose of establishing mutual contact, exchanging information and reinforcing attitudes and behaviour (Olorundare, 2007). Information and communication have become today’s hallmark of marketing efficiency. E-commerce marketing serves the same purpose as marketing but has the advantage of speed. Just like the case of marketing, it offers a process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return. Marketing, in the real sense involves satisfying customer needs.
Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging value with others (Kotler and Armstrong, 2005). Marketing in Africa is characterized by fundamental traditional practices, but of recent, e-commerce marketing is assuming a centre stage largely due to the digital revolution which has created an information age characterized by mass production, globalisation, deregulation, heightened competition,
industry convergence, mass consumption and retail transformation (Zittrain, 2008). The perspective of marketing under discussion is that of drugs as embarked on by pharmaceutical businesses.
PROJECT TOPIC- UTILISATION OF E-COMMERCE MARKETING COMPETENCIESBYPHARMACEUTICAL BUSINESS OPERATORS IN ANAMBRA AND IMO STATES OF NIGERIA
The pharmaceutical industries develop, produce, and market drugs licensed for use through medications. Pharmaceutical companies are allowed to deal in generic and/or brand medications and medical devices. They are subject to a variety of laws and regulations regarding the patenting, testing, ensuring safety and efficacy and marketing of drugs.
Usifo (2010) stated that the practice of pharmacy at present, involves among others, the interpretation, evaluation and implementation of medical orders; drug administration and marketing. Present pharmacy practice reflects an evolving paradigm shift from one in which the pharmacist primarily supervises medication distribution and counsels patients, to a more expanded and team-based clinical role. The end point of all pharmaceutical practices, products and services is the final consumer who is the last link in the channel of distribution and marketing offers the means by which these goods and services get to the consumer.
Pharmaceutical goods and services attract much attention in Nigeria. The health of the Nigerian nation is considered paramount in her developmental strides to the extent that two agencies in the country (National Agency for Food and Drug Administration and Control and National Drug Law Enforcement Agency) are charged with the responsibility of drug supervision. The country is grappling with the problem of drug production, distribution and administration and the pharmaceutical firms are playing a key role in this struggle.
Pharmacists are at the centre of the medication use process and they will soon be faced with handling the multi-directional flow of all health care-related data and a variety of automated dispensing and billing processes from electronic prescribing (e-prescribing) to point-of-sale technology (Webster and Spiro, 2010). Pharmacists therefore, need to broaden their knowledge and experiences with modern trend to face the myriad of opportunities and challenges presented by a new world of electronic health care. Webster and Spiro (2010) averred that pharmacists who hesitate to use up-to-date technology run the risk of falling behind in patient care services and marketing options.
Pharmaceutical business is chosen for this study as a branch of business that is considered paramount in Nigeria. Pharmacists who are the masterminds of pharmaceutical businesses are sensitive to the dynamics of drug business and are also prone to buying of drugs. They are aware
that the country places a high premium on pharmaceutical businesses. Some of the perennial problems that the Nigerian nation is facing at present emanate from drug marketing (Erhun, Babalola and Erhun, 2001).
These problems revolve around illicit and non-technology driven drug marketing, incessant deaths arising from the administration of non-efficacious drugs, emergent new capabilities that exposes consumers to new technologies, deplorable transportation and storage facilities. These problems have exposed the pharmaceutical business operators to a need for a marketing practice that would match the need of the moment.
To this end, the national psyche is captured in the mandate of the Pharmaceutical Society of Nigeria encapsulated in their vision “To create an enabling and adequately regulated environment for the provision of quality pharmaceutical services for sustainable health care delivery” (Azubuike, 2011). Provision of quality services gives credence to development. Modern economic development hinge on exploring technological innovation and when the right infrastructure is put in place, development blossoms.
Nmadu (2012) avers that modern economic growth theories point out that growth is a process of continuous technological innovation, industrial upgrading and diversification and improvements in the various types of infrastructure and institutional arrangements that constitute the context for business development and wealth creation.
For the purpose of this study, pharmaceutical business operators are classified into various demographic characteristics. The first of the classified demographic characteristics in the study is “gender”. Gender is the fact of being male or female. The study considers the gender of the pharmaceutical business operators because pharmaceutical business is not the exclusive activity of men. Male and female operators are involved in pharmaceutical businesses.
Another demographic characteristic in this study is that of years of experience in the business. Experience, refers to the knowledge and skill that one gain through doing something for a period of time (Hornby, 2005), and they influence the way one thinks and behave. The pharmaceutical business operators have variousexperiences depending on their years of operation of their businesses. Their years of experience have been organised in three clusters for the purpose of the study. The first of the cluster is 1-5years experience, the second is 6-10 years and the third is from11years and above.
Location was another demographic characteristic in the study. Location is a place where something happens or exists (Hornby, 2005). The pharmaceutical businesses are located and spread over the two States that are being studied.
‘Ownership of businesses’ is another demographic characteristic in the study. The term ‘ownership’ emphasizes rights and possession. Ownership of business, therefore, implies that the businesses are possessed by those whose rights of ownership are stated in the registration certifications. The three classes of people that own businesses are sole proprietors, partners and those with limited liability where ownership is divorced from control. The pharmaceutical business operators belong to the three groups irrespective of their nature of operations. The studied groups operate under any of the classifications namely, sole proprietors, partners and limited liability companies.
The last demographic characteristic is tagged ‘educational qualification’. Educational qualification refers to the achievement of individuals in the acquisition of learning experience and this is often certificated at the end of such achievement. Acquisition of educational qualifications attests to the fact that the individuals who acquired such qualifications have been to school over a period of time to acquire knowledge and develop skills. The pharmaceutical business operators, therefore, possess classes of degrees including Bachelor of Science (B.Sc), Master of Science (M.Sc) and Doctor of Philosophy (Ph.D). The term pharmaceutical business operators refer to those that operate pharmaceutical businesses in the studied areas. The pharmaceutical business operators are conversant with the intricacies of drug business and are in a position to provide the desired information.
Pharmaceutical business operators in Nigeria offer their services as community pharmacists, pharmaceutical manufacturers, pharmaceutical importers and distributors. All of these are engaged in direct or indirect marketing of pharmaceutical products and services and the degree to
which they utilisee-commerce marketing competencies differ.
The word competency refers to the aptitude, capability and proficiency that enable one to execute a given task to the required standard. Wisconsin (2014) defined competencies as observable and measurable attribute, knowledge, skill, ability or other characteristics that contributes to successful job performance. These are essential knowledge and skills obtainable in a profession and those which the professionals in the field must possess to be able to demonstrate at optimal level of acquisition and functioning.
Competency is a standardised skill or set of skills for an individual to properly perform a specific job. Encarta (2010) views competency as ability to do something well, measured against a standard especially ability acquired through experience or training. E-commerce marketing competencies, therefore, involves the use of electronic communication and digital information processing technology skill, aptitude and knowledge in marketing business. Marketers that utilisee-commercemarketing competencies are more likely to be successful in the current technology driven marketing environment.
Utilisation connotes the use of item, idea or object to solve an existing problem or to achieve an objective. To utilise, according toHawkins (2005) is to find a use for something. When items are utilised for any purpose, they result to phenomena. Utilisation of Information and Communication Technology tools has brought a new trend in the conception of marketing. Global marketing realities indicate that the extent of utilisation of e-commerce competencies determines successful marketing in today’s internet-driven marketing environment. Many pharmaceutical companies market directly to the consumer rather than going through a conventional retail sales channel.
For example, Japan-based Kenrico markets largely through its company website (Carlson, 2008). Nigeria, at this stage of her development, should be able to follow suit. E-commerce marketing competencies have become a necessary adjunct in modern businesses and as opined by Agomuo (2005), the success of any organisation in the present dispensation, depends to a large extent, on its ability to do business electronically. The importance attached to pharmaceutical businesses in Nigeria, and the need to check the menace of circulation of counterfeit drugs has become urgent requiring efficient and effective marketing effort that will go a long way to checking the menace.
Reviewed literature (Coviello, Brodie, Danaher and Johnston, 2002)reveals that while business activities are assuming a new trend resulting into contemporary marketing practices in emerging market economies such as Argentina not much have been done in Africa (Nigeria inclusive) to keep pace with this trend.
Literature equally reveals that very few marketing orientation studies and practices have been reported from developing countries (Coviello, Brodie and Munro, 2010).The extent, to which this all important and novel marketing practice, is being utilised in this vital area (drug marketing), provokes a concern. E-commerce marketing competencies, in the context of this study, comprise five categories of marketing competencies. The five categories are as follows: webpage marketing competency, database marketing competency, transactional marketing competency, relationship
marketing competency and network marketing competency.
Webpage marketing competency involves all the skills that enable manufacturers to sell their products and services directly to retail customers, bypassing intermediaries such as distributors or retail outlets (Laudon and Laudon, 2006). It also entails the purchase of goods and services over the World Wide Web usually with secure connection through HTTP (Hyper Text Transfer Protocol); a special server protocol that encrypts confidential ordering data for customer protection with e-shopping carts and with electronic payment services like credit cards payment authorizations (Agomuo, 2005).
Webpagemarketing competency may be used to facilitate retail websites such as electronic catalogues that describe and display products for sale. Database marketing competency involves all the skills and knowledge that enables the building, maintaining, and using customer databases and other databases for the purpose of contacting, transacting and building customer relationships (Kotler and Keller, 2009). Shaw (2011) avers that it is an interactive approach to marketing communication. The database marketing competency requires the use of addressable communications media (mail, telephone, fax, sales force etc) to extend help to the marketers’ target audience, to stimulate their demand, and stay close to them by recording and keeping an electronic database memory of customer, prospect and all communication and commercial contacts, to help improve all future contacts.
Transactional marketing competency involves the practice where each party maximizes the return on individual transaction with a view to ensuring immediate value delivery and shortterm revenue generation (Hinsen and Dadzie, 2009). Transactional marketing competencies is often utilised to facilitate business strategy that focuses on single, “point of sale” transactions.
Transactional marketing competency is often targeted at maximizing the efficiency and volume of individual sales rather than developing a relationship with the buyer Relationship marketing competency is about a continuing mutually beneficial business relationship process that encompasses the entire customer life-cycle on long-term customer loyalty, retention and satisfaction to generate a continuing revenue stream from existing customers (Kotler and Keller, 2006).
It is a form of marketing developed from direct response marketing campaigns which emphasizes customer retention and satisfaction (Quirk (2011). This is predicated on the premise of an evolving trend in marketing whereby marketing has moved from a transaction-based effort to a conversation. Relationship marketing competency comprisesthe skills for developing deep, ensuring relationships with people and organisations that could directly or indirectly affect the success of the firm’s marketing activities.
As a practice, Relationship Marketing differs from other forms of marketing in that it recognises the long term value of customer relationships and extends communication beyond intrusive advertising and sales promotional messages. Network marketing competency demands the utilisation of internet skills for connecting different levels of marketers for the purpose of achieving an organisation’s marketing objective.It involves the development of inter-firm relationships through coordination of activities among multiple parties in the entire value chain(Coviello, Brodie, Danaher and Johnston (2002).
It enables the practice of expanding the number of one’s business or social contacts (Laudon and Laudon, 2006). Network marketing competency offers the chance for the sales force to be compensated not only for sales they personally generate, but also for the sales of others they recruit, creating a down line of distributors and a hierarchy of multiple levels of compensation.
Anambra and Imo States are two out of the five South Eastern States of Nigeria chosen for this study. These two States under study have the highest number of pharmaceutical businesses (185 and 94) in the South Eastern States as against the other three States with less number of pharmaceutical businesses namely Abia 65, Enugu 81 and Ebonyi 19 respectively. Onitsha particularly, in Anambra State is strategically located with her conglomeration of businesses and serves as a confluence that embraces business patronage from the north, west, east and central part of Nigeria.
It is not surprising therefore, that Imo State which has a close proximity with Anambra State is fast rising in business activities. These two States take the lead in drug business necessitating their choice as the hub of drug business in the South Eastern part of Nigeria. Among the other Igbo States, Enugu and Ebonyi are more of civil service States and Abia State (Aba town in particular) is a multifaceted industrial area that is more engrossed in the marketing of textiles and other wares. At present, a lot of attention is directed towards the South East in its drug marketing as evidenced by her incessant encounters with the drug law enforcement agencies.