COMPETITIVE STRATEGIES AND ORGANISATIONAL SURVIVAL IN MICRO FINANCE BANKS
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COMPETITIVE STRATEGIES AND ORGANISATIONAL SURVIVAL IN MICRO FINANCE BANKS
1.0 INTRODUCTION TO COMPETITIVE STRATEGIES AND ORGANISATIONAL SURVIVAL IN MICROFINANCE BANKS
1.1 BACKGROUND OF THE STUDY
The number of microfinance banks in Port Hacourt and throughout Nigeria is expanding, as is the level of competition among them; only those with the finest tactics tend to perform better in the market.
Customers of microfinance banks in Nigeria are few; now, with the number of microfinance banks in Port Hacourt with a small number of customers, the level of competition among microfinance banks in Port Hacourt has increased.
For the purposes of this research, we will look at various techniques that will assist microfinance institutions thrive in today’s competitive market, such as promotion strategies, effective customer connection strategies, and a solid advertising medium.
In terms of promotion, most microfinance banks tend to reach out to the public; the best approach to reach out to the public, according to (Czinkota & Ronkainen, 2004), is simply by advertising, sales promotion, personal selling, public relations, and direct marketing.
Promotion and advertising are intertwined, as they cannot exist without one another; raising awareness among the general public about the arrival of such a microfinance bank.
In terms of marketing, microfinance banks with good and experienced marketers who are leaders in their area and can work with less instructions can outperform microfinance banks with less experience marketers.
Another important aspect that must be handled is public relations; Port Hacourt is a large city with a lot of competition in the market nowadays.
It would be disastrous to lose a customer to another bank because of the manner in which the sales person or marketer speaks to or treats his or her consumer.
Public relations should be a watchword for a microfinance bank that wants to outperform the competition.
When the personnel or employees of such microfinance banks recognise the value of public relations, they can go a long way.
Another area that requires attention is advertisement; it could be a radio advertisement, flier distribution, or giving out shirts, caps, pen, or anything with the name of the micro finance bank on it; this is simply to raise awareness; images stick more than words in the mind.
1.2 STATEMENT OF THE PROBLEM
Most micro finance banks today tend to fold up because they cannot earn a good income from customers. Micro finance banks operate on a low key, because they deal with low income earners such as market men and women, whose daily sales do not exceed hundred thousand.
With the level of competition in the market today from other micro finance banks, the number of customers tends to be minimal per bank, which has an adverse effect on the growth and development of micro finance banks.
Another issue that these micro finance banks have is a shortage of money. Because these organisations are known for providing loans to their consumers, imagine a micro finance bank that does not have a stable foundation and cannot provide loans to their customers.
1.3 RESEARCH QUESTION
1. What are the sources of capital for Nigerian microfinance banks?
2. Does advertising improve the odds of survival for microfinance banks in Port Hacourt?
3. What responsibilities do financial institutions play in the development and growth of microfinance banks in Port Hacourt?
4. What other government policies are in place to support the effective performance of microfinance banks in Nigeria?
5. Does a competent public relations strategy have a major impact on the performance of Port Hacourt’s microfinance bank?
1.4RESEARCH HYPOTHESIS
H0: There is no significant association between advertising frequency and microfinance bank survival strength.
H1: The rate of advertisement has a substantial association with the survival strength of microfinance institutions.
H0: Branding and advertising have no substantial effect on the market performance of microfinance.
H1: Branding and advertising have a substantial impact on the market performance of microfinance.
1.5 GOALS AND OBJECTIVES OF THE STUDY
The goals of this research project are as follows:
1. Determine the sources of capital for Nigerian microfinance banks.
2. Determine the impact of advertising on the survival of microfinance banks in Port Hacourt.
3. Identify the responsibilities of financial institutions in the creation and development of micro financing banks in Port Hacourt.
4. Disclose government initiatives that will help microfinance institutions in Nigeria run well.
5. assess the impact of a competent public relations strategy on the performance of microfinance banks in Porthacourt.
1.6 SIGNIFICANCE OF THE STUDY
The research will offer a lot of information that microfinance institutions will need to survive in a competitive environment. The study is considered beneficial since it will reveal both marketing strategies through branding, advertisement, and other public relations methods.
The study will advise microfinance banks on how to compete in today’s market, as well as the owners of most microfinance banks on the necessity of loan granting. The study will contrast microfinance banks with experienced marketers and those without.
1.7 SCOPE OF THE STUDY
The research will focus on the concepts of microfinance banks. It will go over the microfinance market and its level of competition. The benefits of microfinance banks’ financial strength will also be emphasised. Finally, the study will go through several microfinance institutions in Porthacout.
1.8 LIMITATIONS OF THE STUDY
FINANCIAL CONSTRAINTS: Due to financial constraints, the researcher was unable to visit all of the micro finance banks in Port Hacourt, but the researcher was able to obtain all of the information required for the purpose of the study.
TIME CONSTRAINTS: Because Port Hacourt is a very busy town with a limited number of roads, it was difficult for the researcher to visit these micro finance banks on time; however, with the few visits, the researcher was able to obtain useful information for the research work and meet the deadline for completion of the research work.
1.9 DEFINITION OF RELATED TERMS
COMPETITION: the activity or state of striving for something through defeating or establishing supremacy over others.
ADVERTISEMENT: Is a method of raising public awareness of a product, a company, or an organisation.
BRANDING: The process of developing a distinct brand and image for a product in the minds of consumers, primarily through advertising campaigns with a recurring subject.
STRATEGY: an action plan designed to attain a long-term or overall goal.
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