THE EFFECTS OF PRICING AND DISTRIBUTION STRATEGIES ON CONSUMER PREFERENCES: THE CASE OF HESCO WATER

By: Julius Kenkoh Nkiese | Department of Business and Management Studies | Procurement, Logistics and Supply Chain Management

ABSTRACT

This study entitled "The Effects of Pricing and Distribution Strategies on Consumer Preferences, Case of HESCO Water Bottling Company” stems from the fact that HESCO Water is in existence for close to a decade, yet it is sparingly available in the markets, and as such, many consumers, and retailers of bottled water in the market are unaware. The specific objectives of the study were to investigate the effect that Cost-based Pricing, Competition-based Pricing, Customer Value-Based Pricing as pricing Strategies, and Push-Pull distribution strategy, Outsourcing, and Collaborative Planning, Forecasting and Replenishment (CPFR) as Distribution Strategies respectively have on Price and availability, and therefore Consumer Preferences for HESCO Water in Douala Cameroon. The research was a correlational study with a study population was 2,983,888 (Douala Population) and target population of 1,629,799 (those aged between 15-65 years). A questionnaire was administered to 400 random potential consumers and retailers selected through multistage sampling to determine their preference to HESCO Water. An interview guide was equally employed at the Company to obtain Pricing and Distribution information. From the findings, pricing did not stem out as having a significant influence on customer preferences for bottled water, but rather distribution did. It was clear that the company needs to revise its distributions strategies to make HESCO water readily available, at the point of purchase for consumers to be able to make a purchase decision for it. Therefore, distribution variables profoundly affect consumer preferences for bottled water in Douala and must be considered by HESCO company to increase its consumption, increase market share, profitability, and Return on Investments.

Key Words: Pricing Strategies, Cost-Based Pricing, Value-Based Pricing, Competition-Based Pricing, Push-Pull, Outsourcing, CPFR, Distribution Strategies, Consumer Preferences