CHAPTER ONE
1.1. Background of the Study
In this present contemporary epoch, the internet has been extensively used in a lot of aspects, and its influence is spreading massively to the extent that it is not just to change the culture of human activity but as well as impacting even the property market. The use of internet in buying and selling does not just take place in a country, but also across the world and the internet has significantly changed the way property transactions are carried out. Thus, the internet has made it possible and easy for customers to patronage businesses and makes business transactions at ease. Consumer patronage is therefore referred to as the extent at which a buying unit concentrates purchases over time to a particular product within a service category.
Globally, Anderson and Sullivan (2019) stated that customer expectations of satisfaction results into an increase in tendencies to patronize a specific brand. They further claimed that organizations that provide high quality products and services on a regular basis will have more satisfied customers and these customers will likely re-patronize the service and products next time. These assertions was supported by Kivela, Inbakaran and Reece (2017) when indicating that comparatively, firms that offer service of superior quality is bound to get their customers satisfied as well as get higher economic returns more than their competitors.
In the United Kingdom, Oliver (2018) claimed that businesses that provide quality services and products achieve higher customer patronage; unsuccessful business has to attract customers. This affects the net margin because it is much more expensive in advertising promotion and selling to win customers than to hold existing ones. Palmer (2018) posited that the drop in consumer patronage is attributed to the increased targeting of specialty niches and the increased diversity of shoppers. Developing a high consistence market share of consumer patronage is the ultimate goal of marketing strategy. Finding out how consumers learn about a business product or service and become attached to them assist marketers in achieving their goals.
In China, Zhang, Zhu, and Ye (2016) revealed that in this era of digitalization, customers utilize the Internet by reviewing the retailers and trust other people’s opinions and experiences with the product or service mentioned in the review section. These reviews will guide a customer in whether or not to patronize the business. This is because any negative review left by a customer may discourage the potential future buyers (Leon, 2019). Prior to the age of Internet, customers could only get information about a product by physically visiting the outlet or store. Therefore, firms and business owners need to ensure that they provide quality service to their customers in order gain a positive review which can influence the patronage of potential customers, (Keiningham, Gupta, Aksoy, &Buoye, 2019).
In developing countries such as South Africa for instance, Sovensen (2019) observes that, quite a number of marketing managers are concerned with a growing trend towards consumer switching. Among the reasons given for the drop in the consumer patronage are consumer boredom and dissatisfaction with a product or service, the constant availability of new products or services and increased concern over price. In Liberia, Busalim and Hussin (2019) mentioned that it costs six times as much to win customers as to retain existing ones. Customer patronage provides the basis for a stable and growing market share. Baker (2017) argued that, for obvious reasons the patron customer is the key importance to manufacturing industry especially those patron customers who are higher spenders or provide long patronage. Baker (2017) further mentioned that, improving the satisfaction of customers is a key to gaining customer patronage. Being a patron customer indicates that a customer will stay a patron, talk favorably about the bar and its services, pay less attention to competing bars and less sensitive to price and buy more as the bar introduces new services and upgrades existing services.
In Nigeria, the advent of new technologies has rapidly enhanced the growing rate of customers’ patronage. Customer patronage in Nigeria has been on the increase on a daily basis, and this has been attributed to the adoption and development of technology by many businesses across the country, (Babatunde&Ajayi, 2018). Since the advent of Internet has changed the way people live in a great number of ways. One of them is house buying and selling of property. For instance, websites allow Alárò City FZC to showcase their products to an international audience, and in the process attract the audience to patronage their products. In addition, customers who want to patronage a business can visit websites to get ideas about categories of communities, as well as specific information (Babatunde, Ajayi, & Timothy, 2016). In this present day, a lot of university students now use the Internet for various reasons among which include, to make a purchase, to pre-order, to chat, to disseminate information, communicate, and promote their products and services. Falahah and Rosmala (2017) argued that, a number of students and youths these days, now engage in patronage using their smart phones.
Real estate is a promising setting for studying online marketing as it is an information-intensive and information-driven industry; transaction-based, with high value and asset-specificity; market-intermediary (agents and brokers connect buyers and sellers rather than buying or selling themselves); and experiencing on-going information technology (IT) related changes through online marketing (Lv & Jiang, 2018). In an attempt to increase brand popularity, productivity and profitability, real estate companies are adopting the use of Internet to deliver market information to consumers about their real estate market. Thus, it is based on the above background that this present study seek to examine the effect of online marketing strategies in selected real estate firms.
1.2. Statement of the Problem
In contemporary era of technological advancements, various online marketing strategies have emerged as a new concept, and thus, it has turned out to be one of the important channels for maximizing profit by firms. Despite, its importance, there is a dearth of research focusing on the influence of online marketing strategies, while the only few studies carried out in this regard are conducted in developed countries. Thus, this is a gap this present study seeks to address.
For instance, the study of Aytekin and Keskin-Demirli (2017) examined the role of social media in real estate marketing in Turkey. The authors used social media measurement tools such as Buzz Sumo and Retweet Rank to carry out data collection by tracing through the real estate websites and pages. The results revealed a positive relationship between web traffic and social network metrics, which means that effective use of social networks supports increasing web traffic. On the contrary, the study of Folorunsho, Adefila, and Momoh (2017) examined online technology and marketing of financial services in Nigeria. The study revealed low impact, which implies that the country has not realizes her full potentials in harnessing online technology for marketing of financial services. Their study as well showed incidence of challenges associated with implementation and performance of online marketing of financial services in Nigeria which include fluctuation in online services due to poor infrastructure, high rate of online fraudsters, slim awareness on the part of the customers, e-payment bottleneck, among others.
Based on the review, it showed a mixed result, that is, both positive and negative results were found. Thus, the problem statement for this study is to come to a conclusion whether to agree or disagree to the findings above. Therefore, this prompted the study on the effect of online marketing strategies and customer patronage of selected real estate firms, Lagos State, Nigeria.
1.3. Objective of the Study
The primary objective of this study is to examine the effect of online marketing strategy and customer patronage of selected real estate firms in Lagos, Nigeria. In order to achieve this, the following specific objectives are to;
i. examine the effect of influencer marketing on the popularity of online marketingon selected real estate firms in Lagos State, Nigeria.
- assess the effect of email marketing on the profitability of online marketing on selected real estate firms in Lagos State, Nigeria.
- find out the effect of content marketing on the productivity of online marketing on selected real estate firms in Lagos State, Nigeria.
1.4. Research Questions
The following research questions for the study are:
i. What is the effect of influencer marketing on the popularityof online marketing on selected real estate firms, Lagos State, Nigeria ?
- What is the effect of email marketing on the profitabilityof online marketing on selected real estate firms in Lagos State, Nigeria?
- What is the effect of content marketing on the productivityof online marketing on selected real estate firms in Lagos State, Nigeria?
1.5. Research Hypothesis
Ho1: Influencer marketing has no significant effect on the popularity of online marketing on selected real estate firms, Lagos State, Nigeria.
Ho2: Email marketing has no significant effect on the profitability of online marketing on selected real estate firms, Lagos State, Nigeria.
Ho3: Content marketing has no significant effect on the productivity of online marketing on selected real estate firms, Lagos State, Nigeria.
1.6. Operationalization of Variables
The dependent variable is customer patronage, represented by Popularity (PP), Profitability (PT), and Productivity (PD). On the other hand, online marketing strategies, being the independent variable, are proxied by Influencer Marketing (IM), Email Marketing (EM), and Content Marketing (CM).
Where Y= Dependent variable
X= Independent variable
Y= f(X)
X= Online Marketing Strategies
X = f(x1, x2, x3)
x1= Influencer Marketing (IM)
x2= Email Marketing (EM)
x3= Content Marketing (CM)
Y= Customer Patronage
Y= f(y1, y2, y3)
y1 = Popularity (PP)
y2 = Profitability (PT)
y3 = Productivity (PD)
The three specific objectives are operationally expressed as:
Y1 = f (x1)
Y1 = β0 + β1x1 + u -----( i )
Y2 = f (x2)
Y2 = β0 + β1x2 + u -----( ii )
Y3 = f (x3)
Y3 = β0 + β1x3 + u -----( iii )
1.7. Scope of the Study
The study will be on the effect of online marketing strategy and customer patronage in selected real estate firms, Lagos State, Nigeria.The geographical location of the study will be Lagos State, Nigeria because much research has not been carried out in this location. Furthermore, the research design will make use of the survey research design because, it is the primary way of obtaining quick information by asking multiple questions to draw meaningful research conclusions. The population of the study will consist of the employees in Alárò City FZC and Adron Homes Properties Lagos State, Nigeria.
1.8. Significance of the Study
The findings of this study would be significant in the sense that, it would enable real estate companies identify the suitable marketing strategy that will enhance their brand image, boost customer patronage and as well as a positive influence on their properties or facilities.
Furthermore, the findings of this study will add to the wealth of information presently available on the influence of online marketing strategies on real estate business patronage. In addition, the findings are expected to contribute to closing the gap in literature with respect to understanding the impact of online marketing strategies in enhancing brand image, productivity, and profitability.
The study will as well highlight the importance of influencers, email and content marketing as a vehicle for promoting brands, products and services, and as well as influencing public opinions about a particular brand and to create customer patronage.
Lastly, this topic is unique in sense that it focused on the real estate industry which is a rare field in research, and thus, future researchers and scholars can find this research useful as a literature review in relation to the topic.
1.9. Definition of Operational Terms
Online Marketing:Online marketing is efforts to market products and services and build customer relationships over the internet ( Kotler, 2012).
Influencer Marketing: It is a type of social media marketing that uses endorsements and product mentions from influencers- individuals who have a dedicated social following and are viewed as experts within their niche (Chen, 2020).
Email Marketing: It involves sending messages usually in mass quantities- that advertise your product or services (Corson, 2021).
Content Marketing: Content marketing is a strategic marketing approach focused on creating and distributing valuable, relevant and consistent content to attract and retain a clearly-defined audience- and, ultimately, to drive profitable customer action ( Pulizzi, 2001)
Customer Patronage:It is a person or thing that eats or uses something or a person who buys goods and services for personal consumption or use (Kenneth, Miebaka&Ezirim, 2015).
Business Productivity: Productivity in business is the measure of economic or business performance that indicates how efficiently people, companies, industries and whole economies convert inputs, such as labor and capital, into outputs such as goods or services (Holliday, 2021).
Profitability: It is a measure of an organizations profit relative to its expenses (Glossary, 2022).
Business Popularity:The popularity of a business or brand is the process through which customers have adequate knowledge and awareness of a brand, its product or service in the market (Crain, 2015).
