BIBLIOGRAPHY TOYAO, JOANA A. APRIL...
BIBLIOGRAPHY
TOYAO, JOANA A. APRIL 2013. Marketing Strategies of Selected Cooperatives
in Atok, Benguet. Benguet State University, La Trinidad, Benguet.
Adviser: David Joseph L. Bognadon, MSc.
ABSTRACT
This study was conducted covering five selected cooperatives in Atok, Benguet. Three
managers and two chairman of the board of directors as key respondents of the study.
Specifically the objectives of this study were to: know what are the businesses the
cooperatives are in; marketing strategies in terms of product, price, place and promotion;
cooperatives’ marketing strategies which are successful and sustainable to the cooperative
and the problems encountered. The results revealed that majority of the cooperatives offer
farm supplies, credit and financing of consumers’ goods. The cooperatives also offer
marketing services for their member products.
Furthermore, the result shows that with regards to each marketing strategies,
cooperatives have their own product uniqueness and value that helps address customers’
needs. Cooperatives priced their products based on production cost plus percentage mark-
up. Having the objective to satisfy customers and they used direct customers, retailers and
promote their product through sales promotion and majority gets their marketing message
on occasions and festivals that influence the cooperatives to the innovations and
development of their product.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Moreover, with regards to the marketing strategies, cooperatives encountered
problems which are in terms of product: lack of raw materials to be used; for price strategy:
buyers’ preferential differences wherein some customers are value oriented; for place
strategy: limited channel of distribution and in terms of promotional strategy is the limited
knowledge on promotional strategies. On the other hand, cooperatives have successful and
sustainable marketing strategies which are trainings and seminars, effective and efficient
service offered products, patent and brand, consistent supply of the product, lending
services and social services (Ammoyong, death aid).
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
INTRODUCTION
Rationale
Atok is a fourth class municipality in the province of Benguet, Philippines. It is
centrally located in the heart of the province of Benguet. It is bounded by the municipality
of Kibungan and Buguias on the north, the municipalities of the Kabayan and Bokod on
the east, the municipality of Kapangan on the west and the municipality of Tublay on the
south. It is politically subdivided into eight (8) barangays wherein from present each of this
barangay had put up their own cooperatives which are either service, consumer, multi-
purpose, producer cooperatives. Most of their cooperatives are multi-purpose, service and
consumer cooperatives. Others put up two cooperatives in each barangay.
Each cooperative have their own approaches and strategies in having more customers and
members. They have their own way of conceptualizing how to market their product and/or
the cooperative itself. Each has their own marketing strategy in helping make their
cooperative successful.
Marketing has become an increasingly vital ingredient for business success and one of the
most important components required for sustainable operation of Cooperatives (Cravens,
1987).
The process of marketing involves meeting needs profitably, identifying and
meeting human and social needs. It is an organizational function and a set of process for
creating, communicating and delivering value to customers and for managing customer
relationships in ways that benefit the organization and its stakeholders (Czepiel, 1992).
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Nowadays, many cooperatives have succeeded but there are also those which failed
for some reasons. One reason can be due to less attention on the marketing aspect of the
cooperatives and also many of the Cooperatives’ managers and/or executives lack
marketing orientation needed in marketing their products and in satisfying their customers.
Also, due to existence of competitors and that they lack strategies in marketing their
products.
Therefore, Cooperatives must develop marketing mix, in other words, managers,
executives and board of directors decide about the most effective composition of the four
components of marketing strategy, namely; product/service, price, place and promotion in
order for the cooperatives to succeed.
Cooperatives are considered to be an instrument for socio-economic development
of the people into a more responsible and more productive citizen. This study will focus on
the marketing strategies of the selected Cooperatives in Atok, Benguet to make comparison
on their similarities and differences that will be an instrument to strengthen anddevelop the
potentials of the people in building up capital for productive investment and empower them
towards economic independence.
Equipped with this set of information, any cooperative will be able to formulate
future effective marketing strategies. This means the questions on what product to sell or
what service to serve, how to price, where to sell, how to sell or promote the product and
service would be best decide upon. Also, Cooperatives would be able to gather the required
information to make wise and sound decisions in formulating and applying marketing
strategies.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Statement of the Problem
The study focused on the marketing strategies of selected Cooperatives in Atok, Benguet.
Specifically, this study answers the following questions.
1. What businesses the cooperatives are in?
2. What are the marketing strategies of cooperatives in terms of product, price, place
and promotion?
3. What are the Cooperatives’ marketing strategies that are successful and
sustainable?
4. What are the problems encountered by the cooperatives in adopting such strategies?
Objective of the Study
The study aimed:
1. To determine what businesses the cooperatives are in;
2. To identify the marketing strategies of cooperatives in terms of products/
services, price, place and promotion;
3. To determine the Cooperatives’ marketing strategies which are
successfuland sustainable; and,
4. To identify the problem encountered by the cooperatives in adopting such
strategies.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Importance of the Study
Since the study is about the marketing strategies of cooperatives, the findings of
this study will provide information to researchers as well as to manager or executives in
their decision making process in making strategies to achieve organizations’ competitive
advantage towards the cooperatives’ success.
Also, the findings of the study will serve as a strategic tool by cooperatives that
enables them to improve strategies in identifying key driving forces and anticipate future
market directions. It helps provide numerous benefits including anticipating competitors’
actions improve teamwork, promote learning and innovation within the organization.
Furthermore, the study will serve as a reference for students and researchers
intending to study marketing strategies.
Scope and Delimitation of the Study
The study focused on the marketing strategy of selected Cooperatives in Atok, Benguet. It
is delimited to managers and chairman of the board of directors of every selected
cooperative in Atok, Benguet.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
REVIEW OF LITERATURE
Marketing Strategy Defined
Marketing strategy is a process that can allow an organization to concentrate its resources
on the optimal opportunities with the goals of increasing sales and achieving a sustainable
competitive advantage. Marketing strategies includes all basic and long-term activities in
the field of marketing that deal with the analysis of the strategic initial situation of a
company and the formulation, evaluation and selection of market-oriented strategies and
therefore contribute to the goals of the company and its marketing objectives (Kohls and
Downy, 1972).
Marketing strategies serve as the fundamental underpinning of marketing plans designed
to fill market needs and reach marketing objectives. Plans and objectives are generally
tested for measurable results. Commonly, marketing strategies are developed as multi-year
plans, with a tactical plan detailing specific actions to be accomplished in the current year.
Marketing strategies are dynamic and interactive. They are partially planned and partially
unplanned (Evans and Berman, 1990).
Marketing strategy involves careful scanning of the internal and external environments.
Internal environmental factors include the marketing mix, plus performance analysis and
strategic constraints. External environmental factors include customer analysis, competitor
analysis, target market analysis, as well as evaluation of any elements of the technological,
economic, cultural or political/legal environment likely to impact success. A key
component of marketing strategy is often to keep marketing in line with a company's
overarching mission statement. Once a thorough environmental scan is complete, a
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strategic plan can be constructed to identify business alternatives, establish challenging
goals, determine the optimal marketing mix to attain these goals, and detail
implementation. A final step in developing a marketing strategy is to create a plan to
monitor progress and a set of contingencies if problems arise in the implementation of the
plan (Aaker, 2008).
Cooperative Defined
Cooperatives (Laidlaw, 1974) are duly registered association of persons with common
bond of interest, who voluntarily joined together to achieve a lawful common social and
economic end, making equitable contributions to the capital required and accepting a fair
share of the risks and benefits of the undertaking in accordance with universally accepted
cooperatives principles.
Moreover, cooperative as defined by Grove (1985) is an autonomous association of persons
united voluntarily to meet their common economic, social and cultural needs and
aspirations through a jointly owned and democratically controlled enterprise. It has their
own principles, strategies and approaches in managing their cooperatives.
Classification of Cooperatives
According to Mcleod (2006) the business or enterprise of cooperatives may be classified
as to activities.
Credit cooperative. Promotes and undertakes savings and lending services among
its members. It generates a common pool of funds in order to provide financial assistance
to its members for productive and provident purposes.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Consumer cooperative. The primary purpose is to procure and distribute
commodities to members and non-members. It aims at fulfilling the needs and aspirations
of their members and further uniting consumers for joint purchases and for the production
of consumers’ goods and subsequent sales of these goods to its members and the
population.
Producer cooperative. It undertakes joint production whether agricultural or industrial. The
production and processing of raw materials or goods produced by its members into finished
or processed products for sale by the cooperative to its members and non-members. Any
end product or its derivative arising from the raw materials produced by its members sold
in the name and for the account of the cooperative, shall be deemed a product of the
cooperative and its members.
Marketing cooperative. It engages in the supply of production inputs to members and
marketing their products. It specializes in providing its members with marketing services,
bringing goods from the producers to the consumers. Maybe considered as a process of
marketing producer which enables the growers to market their produce at better prices,
followed by the intention of securing better marketing services and ultimately contributing
to improvement in the standard living of members.
Service cooperative. It provides service to their members. Also, it engages in the medical
and dental care, hospitalization, transportation, insurance, housing labor, electric light and
power, communication professional and other services. It is important part of the definition
of a service cooperative and provides clues to its nature and its method of working. It means
for example that it does not provide services to other than its members and therefore the
user of its services must become members.
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Multi-purpose cooperative. This combines two or more of the business activities of a
cooperative. For instance the cooperative serviceis a combination of credit lending
production and provision of consumer goods.
Functions Performed by Cooperatives
Cooperatives may perform one or more three core functions; marketing products,
purchasing supplies and providing services ( McLeod, 2006).
Marketing cooperative. It assist members maximize the return they receive for goods they
produce. Most cooperative marketing activity involves either agricultural products or those
of producers in related industries such as forestry, aquaculture and horticulture. New
marketing ventures are developing in such diverse industries as handicrafts, professional
services and information technology. Some marketing cooperatives limit their activity to
negotiating prices and terms of sale with buyers. Growers of fruits and vegetables for
processing and dairy farmers are primary users of these cooperatives.
Other marketing associations assemble member production into large quantities for sale
to further processors, wholesalers or retailers. This first-handler role is common for
cooperatives of grain growers and producers of fruits and vegetables for the fresh produce
market.
Furthermore, marketing cooperative add further value to member production by processing
or manufacturing member products into other more valuable products. These may serve as
ingredients in further processed products or be sold to institutional buyers and restaurants
for their direct use, to grocery chains for resale as private label products, or to brand-name
companies for resale under their brand. Cooperatives that process dairy products, fruits,
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vegetables, grains, fish, and lumber exemplify these value-added processing activities.
Marketing cooperatives enable members to extend control of their products and realize
additional margins through processing, distribution and sale.
Purchasing cooperatives. These were first used by farmers to gain access to affordable,
quality production supplies such as feed, fuel, fertilizer and seed. These early efforts often
became businesses having full-time managers and warehouses to handle other production
supplies and services such as farm chemicals, animal health products, fencing, building
supplies, construction contracting, automotive accessories, etc. Many local purchasing
cooperatives have affiliated with other such organizations, often through regional and
national federated cooperatives. These efforts reduce member costs and strengthen their
purchasing power through direct ownership of large-scale facilities. Today many nonfarm
businesses have developed supply purchasing cooperatives to gain access to the same
volume discounts and quality control assurances long available to farmers. These include
hardware stores, independent grocery stores and fast food restaurant franchisees
Service cooperatives. These were also developed to serve farmers. Some of these services
are farm-specific such as recommending and applying fertilizer, lime, or pesticides; animal
feed processing and crop harvesting. Others are general in nature such as credit through the
Farm Credit System, electricity through rural electric cooperatives and communications
service through rural telephone cooperatives. Nonagricultural service cooperatives are also
flourishing. Credit unions and the National Cooperative Bank provide credit on a
cooperative basis to nonfarm individuals and cooperatives. School systems, health care
providers, and insurance buyers are among the general public segments making use of
service cooperatives.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Benefits of Cooperatives
People buy stock in a non-cooperative business to make money on their investment. The
more of the company you own, the more benefits (stock appreciation and dividends) you
will realize if the business succeeds.
According to Dogarawa (n.d.) the benefits of being a cooperative member differ in
two ways. First, the advantages are more numerous. Second, they are distributed on the
basis of how much use you make of the cooperative, rather than your equity stake. Here
are some benefits of cooperative membership and how they relate to use.
Access to quality supplies and services at reasonable cost. By banding together and
purchasing business supplies and services as a group, individuals offset the market power
advantage of firms providing those supplies. You can gain access to volume discounts and
negotiate from a position of greater strength for better delivery terms, credit terms, and
other arrangements. Suppliers will be more willing to discuss customizing products and
services to meet your specifications if the purchasing group provides them sufficient
volume to justify the extra time and expense.
The larger the group purchasing supplies and services through the cooperative, the greater
the potential for savings. And the more each individual member uses the supply operation,
the more he or she may save over doing business elsewhere.
Also, cooperative members are to manufacture their own supplies and hire experts directly
to provide essential services. This gives members even more reliable sources of supply and
greater control over the types of products available, the cost and the quality of the services
received.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
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Increased clout in the marketplace. Marketing on a cooperative basis like purchasing
supplies and services, permits members to combine their strength while maintaining their
status as independent business people. They can lower distribution costs, conduct joint
product promotion, and develop the ability to deliver their products in the amounts and
types that will attract better offers from purchasers. Through cooperative marketing,
members can share information and negotiate with buyers from a position of greater
strength and security. They can also develop processing facilities by themselves or as part
of a joint venture with other cooperative or non-cooperative firms.
A cooperative can also serve as a vehicle for people selling goods and services to work
with their customers to promote industry research, reduce regulatory burdens, and develop
markets for their products. The cooperative can help create a "win-win" situation for the
entire industry, a business environment where both producers and buyers have more
income.
Share in the earnings. Some people talk about non-cooperative firms operating "for profit"
while cooperatives operate "at cost." This isn't totally accurate. Most cooperatives generate
earnings. They differ from non-cooperative firms in how they allocate and distribute their
earnings.
A non-cooperative firm retains its earnings for its own account, or perhaps pays part
of them out to shareholders as dividends, based on the amount of stock each investor owns.
In a cooperative, earnings are usually allocated among the members on the basis of the
amount of business each did with the cooperative during the year. Permitting their
cooperative to accumulate retained patronage refunds is a relatively easy and painless way
for members to help finance activities and growth. Also, if certain rules are followed, the
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cooperative may deduct both the cash pay-outs and the retained patronage refunds from its
taxable income. This makes cooperative earnings particularly valuable.
Political action. Growers, small business owners, and other rural residents have to realize
that no one gives you a favorable law or regulatory ruling just because you think you
deserve it. You have to build your case and argue your point convincingly. A cooperative
gives people a means to organize for effective political action. They can meet to develop
priorities and strategies. They can send representatives to meet with legislators and
regulators. These persons will have more influence because they will be speaking for many
and not just for themselves.
They can also form coalitions with other groups having similar views on issues. The
larger the voice calling for a specific action, the more likely that the system will respond
with the policy you desire.
Local economy enhanced and protected. Having its businesses owned and controlled on a
cooperative basis helps your entire community. Cooperatives generate jobs and salaries for
local residents. They pay taxes that help finance schools, hospitals and other community
services.
When a business is a cooperative, your town is less likely to lose those jobs and taxes.
A business owned by one person or a subsidiary of a big company, can easily be moved to
another community. When many local people share the ownership of a cooperative, no
individual or company can take it from your area or simply close it. Only the membership
as a whole can make such decisions.
Role of Cooperative in Economic Development
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Cooperatives are community-based, rooted in democracy, flexible and have participatory
involvement which makes them well suited for economic development (Gertler, 2001). The
process of developing and sustaining a cooperative involves the processes of developing
and promoting community spirit, identity and social organization as cooperatives play an
increasingly important role worldwide in poverty reduction, facilitating job creation,
economic growth and social development (Gibson,2005).
Cooperatives are viewed as important tools for improving the living and working
conditions of both women and men. Since the users of the services they provide owned
them, cooperatives make decisions that balance the need for profitability with the welfare
of their members and the community which they serve. As cooperatives foster economies
of scope and scale, they increase the bargaining power of their members providing them
among others benefits, higher income and social protection. Hence, cooperatives accord
members opportunity, protection and empowerment -essential elements in uplifting them
from degradation and poverty (Somavia, 2002). As governments around the world cut
services and withdraw from regulating markets, cooperatives are being considered useful
mechanisms to manage risk for members and keep markets efficient (Henehan, 1997). In a
number of ways, cooperatives play important role in global and national economic and
social development. With regard to economic and social development, cooperatives
promote the “fullest participation of all people” and facilitate a more equitable distribution
of the benefits of globalization. They contribute to sustainable human development and
have an important role to play in combating social exclusion. Thus, the promotion of
cooperatives should be considered as one of the pillars of national and international
economic and social development (Levin, 2002).
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In addition to the direct benefits they provide to members, cooperatives strengthen the
communities in which they operate. According to Somavia (2002), cooperatives are
specifically seen as significant tools for the creation of decent jobs and for the mobilization
of resources for income generation. Many cooperatives provide jobs and pay local taxes
because they operate in specific geographical regions. According to Levin (2002), it is
estimated that cooperatives employ more than100 million men and women worldwide.
Cooperatives can provide locally needed services, employment, circulate money locally
and contribute to a sense of community or social cohesion. They can provide their
employees with the opportunities to upgrade their skills through workshops and courses
and offer youth in their base communities short and long-term employment positions.
Students could also be employed on casual-appointment basis during long vacations.
Through these, cooperatives will contribute to economic development.
Challenges of Cooperative Societies
Cooperatives over the world are in a state of flux. In almost all parts of the world,
cooperatives face one or more of the following crises: crisis of ideology, crisis of capital,
crisis of credibility and crisis of management (Taimni, 1997). Cheney (1995) identified
challenges facing cooperatives. These are cultural transformation, competition and
expansion, wage solidarity, centralization and reorganization, strategies and approaches
and programme to increase productivity and participation. Groves (1985) on the other
hand, posits that one of the major problems of cooperatives is how to keep balance in the
two parts of cooperative business’ efficiency and democracy, since those who are charged
with the operation of a cooperative chiefly, the board and manager must serve two masters:
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the imperatives of good business practice and the social purpose of a community of people.
Hence, to maintain their special character, cooperatives must be two things in one: a
business organization and a social movement. This is what makes a cooperative a business
enterprise with a human face and so very difficult to manage. In striving for efficiency,
cooperatives often tend to imitate other business, but in pursuing a social purpose they
bring out the features which make them different (Laidlaw, 1974). Educating,
training
and retraining of members in general and officers in particular are always a challenge to
cooperatives especially in developing countries. A cooperative without a strong component
of education is in danger of losing its essential character, that is, the human and personal
characteristics which distinguish it as a cooperative. Education is of paramount importance
to the cooperative sector. Unless all those responsible for cooperatives (directors, officers,
members, staff) are well informed and knowledgeable, cooperatives are likely, in some
countries, to become much like capitalist, profit-seeking business, or in other countries to
become handmaids of the State. Education makes people easy to lead, but difficult to drive;
easy to govern but impossible to enslave. Assuming the validity of the sector concept (the
"mixed economy", as it is often called), cooperators face such questions as what type of
business activity is most suitable for each of the three sectors, public, private and
cooperative? Are there certain kinds of business that rightfully belong to the public sector?
Are there others which are best left to private enterprise? What kinds ideally, are most
suitable for the cooperative way of business? Are there some fields in which all three may
engage and compete? Hence, one other challenge that cooperative societies face is the
choice of business most suitable for the enterprise.
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Another challenge facing cooperatives is adaptation. No business in a national economic
system is completely independent and self-sufficient but operates in conditions of
dependence and interdependence. Similarly, the State and public enterprise depend greatly
on private enterprise or on cooperatives. Sometimes, private-profit business depends on
cooperatives. And of course, the reverse, cooperatives depending on private business in
some way or other, is quite common. Thus, cooperatives cannot be thought of as an
exclusive economic system but rather as one section of the total economy. They constantly
operate in co-existence with other forms of business and sometimes in conjunction with
them. Co-operatives therefore, have to adapt themselves by struggle in one place, by
agreement in another to the elements of a complex environment, partly free and partly
organized. It must now decide what place it means to claim for itself in the new economy,
either organized orin process of organization.
In addition, the cooperative sector suffers from an internal handicap of its own making; the
frequent failure of various types of cooperatives to work closely together as a sector.
Because of their voluntary and democratic nature, cooperatives have been reluctant to
impose strict disciplines on themselves - they much prefer to act by common consent and
persuasion. Often, management of cooperatives relies on relationship or is moved by
sympathy to act against even the societies’ bylaws. Cooperation among Cooperatives, the
different needs of customers, members, patrons, and owners challenges the cooperative’s
board of directors and manager to make good business decisions. Business earnings of the
cooperative must be great enough to systematically rotate the investment of members, pay
patronage, and offer goods and services at reasonable prices or pay fair market value for
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customer’s products. This unique business structure dictates that the manager, board of
directors and members understand the business and cooperative structure.
Marketing Mix Element
Marketing activities comes in all forms. One traditional depiction of marketing
activities is in terms of marketing mix, which has been defined as a set of marketing tools
the firm uses to pursue its marketing objectives and strategies and was classified as the four
P’s of marketing, product, price, place, promotion. Marketing mix decisions must be made
for influencing the trade channels as well as final consumers (Kotler, 1986).
Marketing mix helps the company to determine what goods or product to offer, to
decide what distribution mix to use, to inform customers and determine the overall level of
price. The main concept of marketing mix depends on number of decisions with regards to
the four major variables of the four P’s (Kotler, 2000).
Rue and Holland (1986) states that marketing mix strategy is also familiar as the
four P’s of marketing (product, place, price, promotion) provides a good starting point for
consideration of the requirements of strategy implementation in the marketing function.
Marketing strategy is an overall program based upon selecting a particular target of the
market (Jurado and Llanes, 1982).
A company’s marketing managers are responsible for planning and implementing
all the activities that result in the transfer of goods or services to its customers. These
activities culminate in the marketing plan-detailed strategy for focusing marketing efforts
on needs and wants. Therefore, marketing strategy begins when a company identifies a
consumer need and develops a product to meet it. In planning and implementing strategies,
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marketing managers develop the four basic components of the marketing mix. (Elbert and
Greffin, 2000).
The Product
It is seen as an item that satisfies what a consumer needs or wants. It is a tangible good or
an intangible service. Every product is subject to a life-cycle including a growth phase
followed by a maturity phase and finally an eventual period of decline as sales falls.
Marketers must do careful research on how long the life cycle of the product they are
marketing is likely to be and focus their attention on different challenges that arise as the
product moves through each stage. The marketer must also consider the product mix.
Marketers can expand the current product mix by increasing a certain product line's depth
or by increasing the number of product lines. Marketers should consider how to position
the product, how to exploit the brand, how to exploit the company's resources and how to
configure the product mix so that each product complements the other. The marketer must
also consider product development strategies (McCarthy, 1960).
Marketing begins with a product- a good, a service or an idea designed to fill a consumer
need or want. Conceiving and developing new products is a constant challenge for
marketers, who must always consider the factor of change- changing of technology,
changing consumer wants and needs, and changing economic conditions. Marketing
consumer needs often means changing existing products to keep face emerging markets
and competitors.
Product differentiation. Producers often promote particular features of products in order to
distinguish them on the market place. Product differentiation is the creation of the feature
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or image that makes a product differ enough from existing products to attract customers
(Elbert and Greffin, 2000).
Go (1997) states that the product function is to provide benefits desired by the target in its
feature like quality, service, brand packaging. Considering the product life cycle, when a
product reaches maturity before its decline, the product must gain a new life cycle. To do
this, continuous product innovation and product development are a requirement.
Innovation may mean repositioning the product by adding better feature or giving it a new
image or developing new concepts, system and approaches. Packaging is an important
factor in projecting the product image.
The Price
“The art of pricing is to have the price be an equate to the value of the product to the
customers –anything less than that represents a sacrifice in potential profits.”
E. Raymond Corey
The price is the amount a customer pays for the product. The price is very important as it
determines the company's profit and hence, survival. Adjusting the price has a profound
impact on the marketing strategy, and depending on the price elasticity of the product, often
it will affect thedemand and sales as well. The marketer should set a price that complements
the other elements of the marketing mix. When setting a price, the marketer must be aware
of the customer perceived value for the product. Three basic pricing strategies are: market
skimming pricing, market pricing and neutral pricing.
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The 'reference value' (where the consumer refers to the prices of competing products) and
the 'differential value' (the consumer's view of this product's attributes versus the attributes
of other products) must be taken into account (McCarthy, 1960).
The second critical marketing mix tool is the price. The concept of price is the amount paid
by the customers for a certain product or service. This can also be defined as a certain value
paid by the user of a certain product. Price can make many forms, but in the final analysis
it is what a buyer pays a seller for a product, service, license or future obligation. A product
price may be termed as a list price, sales or markdown price. A price for service may be
referred as fee or tuition (Holland, 2000).
In marketing mix, price is the only element that produces revenue, all other marketing mix
represent cost. Price is also one of the most flexible elements of the marketing mix where
it can be changed quickly. Price affects most the demand, the company’s sales, the market
share and profit. The price indicates to companies what to produce and who will be their
customers.
Go (1997) revealed that the price function is to make the product affordable to target market
and reflect the value of benefits provided. Customers and competition must be considered
in setting the prices. Tactics in prices include variation, discounts, psychological pricing
and price lining.
Rue and Holland (1986) states that pricing must be considered in relation to costs,
consistency and potential inflation. Benefits of well-conceived pricing include increasing
sales to current customers, attracting new customers, maximizing short-run cash flow, and
maintaining an established position. Pricing product through the prevailing price is another
strategy in commonly practiced. The price for the service is reasonable and fair; moreover,
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much competition was noted with the presence of the same services within the vicinity
(Mahmood, 1996).
Pricing is also a crucial element of marketing mix because profit implication affects the
long term success of any enterprise. Many factors influence pricing decision, for example
is cost, competition, type of product or service, image, supply and demand, environmental
factors such as legislation, taxes and exchange rates. Other decisions on pricing include
different ways of pricing, discounts and credits (Majaro, 1993).
The Promotion
It represents all of the methods of communication that a marketer may use to provide
information to different parties about the product. Promotion comprises elements such as:
advertising, public relations, personal selling and promotion. Advertising covers any
communication that is paid for, from cinema commercials, radio and Internet
advertisements through print media and billboards. Public relations is where the
communication is not directly paid for and includes press releases, sponsorship deals,
exhibitions, conferences, seminars or trade fairs and events (McCarthy, 1960).
Promotion has its own task in the marketing mix to communicate to the customers what
the other elements offer. The promotion of a product communicates what market or what
must be done to satisfy consumer’s needs. The promotion component of the marketing mix
includes four major elements such as personal selling, advertising, sales promotion and
public relation. Almost all promotion conveys some kind of information about the product
and service availability and use. It informs the customers about the functional and
psychological needs the product is designed to satisfy. Promotion is also to remind the
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
customers that the product is still available. It also communicates directly or indirectly
through words and sounds. Promotion is done either to effectively inform and persuade
target market or to offer a positive image of the company and brand which convince
customers to buy (Go, 1997).
A promotional strategy is like a general overall battle plan, it tells a broad term how a firm
will see promotion to secure an advantage over the competition to attract buyers and
capitalize on its resources. A firm’s objective indicates where it wants to go, and its strategy
describes how it will get there and how it will accomplish its objectives. The most
important promotional tolls includes advertising, personal selling, sales promotions and
public relations (Rue and Holland, 1986).
The Place
It refers to providing the product at a place which is convenient for consumers to access.
Place is synonymous with distribution. Various strategies such as intensive distribution,
selective distribution, exclusive distribution and franchising can be used by the marketer
to complement the other aspects of the marketing mix.
Furthermore, place is usually referred to as the channel or distribution. This has been very
important in business. It is very important to have the product at the right place. Having
the product at the right place is to go near the target market customer. Bringing the product
to the target customer is to minimize cost in the business. The purpose is to make the
product available and accessible to target customers. Traditional concept of physical
distribution typically started at the plant and involved bringing low cost solution to get
them to customers (Holland, 1986).
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Go (1997) states that place is otherwise seen as distribution and its function is to make the
product conveniently available to make market consistent with its purchasing patterns.
Influencing factors may be the customers, product or competition are the external factors
and as for the initial factors is the experience, production (control requirements as of the
transportation cost and economic aspect). The distribution system brings the product or
service to the place where it can best fill customer’s needs. Access to distribution can mean
the difference between success and failure for new product.
Placing a product in the proper outlet-say, a retail store requires decisions about several
activities, all of which are concerned with getting the product from the producer to the
consumer. Distribution is also all about finding the best outlet for costumers to receive the
products and/or services the cooperatives offer. Distribution is establishing a system that
gets the product to where the customers want to buy it (Majaro, 1993). The business has to
decide on a channel of distribution which may be described as a system of people and
organization that get product or service from the producer to the customer. Distribution
decisions include deciding on whether to use a direct or an indirect distribution channel
and where the business is to be located (Hutt and Stull, 1992).
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Definition of Terms
Clout. Special advantage or influence; advantage, vantage - the quality of having a superior
or more favorable position; "the experience gave him the advantage over me".
Combating. To fight or contend against; oppose vigorously; to struggle and strive in
conflict.
Joint venture. A joint venture (JV) is a business agreement in which parties agrees to
develop, for a finite time, a new entity and new assets by contributing equity. They exercise
control over the enterprise and consequently share revenues, expenses and assets.
Strategies. As a way of action, becomes necessary in a situation when, for the direct
achievement of the main goal, the available resources are not enough. The task of strategy
is an efficient use of the available resources for the achievement of the main goal. Tactics
is the tool to implement strategy, and is subordinated to the main goal of strategy.
Sustainable. Refers to a mode of human development in which resource use aims to meet
human needs while preserving the environment so that these needs can be met not only in
the present, but also for generations to come; capable of being sustained; capable of being
continued with minimal long-term effect on the environment: sustainable agriculture.
Successful. Having a favorable outcome; having obtained something desired or intended;
having achieved wealth or eminence.
Intrinsic value. Create a new desire or the ability to satisfy needs and wants
Product innovation effectiveness. Developing new product and giving new image.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
METHODOLOGY
Locale and Time of the Study
In order to obtain the desired information, this study was conducted from January to
February 2013 in Atok, Benguet.
Respondents
The respondents of the study were managers and chairman of the board of directors of
primary selected Cooperatives in Atok, Benguet. Specifically the Abiang Community
Multi-Purpose Cooperative (ACMPC), Banayakew Multi-Purpose Cooperative (BMPC),
Caliking Consumer Multi-Purpose Cooperative (CCMPC), Mountain Blooms Multi-
Purpose Cooperative (MBMPC) and Topdac Mtulti-Purpose Cooperative (TMPC).
Research Instrument
Survey questionnaire was employed in the study. Personal interview was conducted to
validate information gathered in the survey questionnaire.
Data Gathered
The data gathered were the marketing strategies in terms of product, price, place
and promotions of selected primary cooperatives in Atok, Benguet. It includes the
marketing strategies which are successful and sustainable and the problems encountered in
adopting such strategies.
Data Analysis
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
The data collected were categorized, tabulated and interpreted according to
theobjectives of the study using tables and descriptive method like frequency and
percentage analysis.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Figure 1. Location Map of the Study
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
RESULTS AND DISCUSSION
Profile of Cooperative
Table 1 presents the profile of the five selected Cooperatives in Atok, Benguet. It
included the type of Cooperative, when was it organized, initial members and initial paid-
up share capital, number of directors and employees.
Type of cooperative. Three (60%) of the respondents are consumer type and two
(40%) are operating both consumer and credit type. It implies that though the cooperative
is registered as a multi-purpose it does not necessarily mean that the cooperative is
operating two or more activities. Some just mainly operate as consumer store.
Year organized. The table shows that two (40%) of the respondents were organized
within the year range 2003-2008 and two (40%) from 1990-1995 and only one (20%)
respondents was organized within 1980-1985. It shows that TMPC is the oldest cooperative
and ACMPC is the youngest cooperative among the five.
Initial members when organized. The result shows that when the cooperative was
organized, two (40%) of the respondents had initial members ranging from 15-20 members
and two (40%) from 40-50 members and only one (20%) had the initial member of 90-100
members. It implies that the cooperative that was organized first have the largest initial
members and those cooperatives that were organized lately have few initial members.
Initial paid-up share capital when organized. The table shows that only one (20%)
of the respondents have the initial paid-up share capital ranging from 4,000-8,000 pesos
while two (40%) of the respondents from 9,000-13,000 and two (40%) from 14,000-
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
18,000. It shows that the Cooperatives’ initial paid up share capital when organized was
quite small, lesser than Php 20,000.
Number of directors. Table 1 shows the number of members comprising the board of
directors in each cooperative. Ideally a cooperative should have at least minimum of five
directors and a maximum of fifteen. The result shows that two (40%) of the cooperatives
have 4-5 directors and 3 (60%) have 6-7 directors.
Number of employees. The table shows that three (60%) of the cooperatives have one to
three employees, one (20%) of the cooperative have 4-6 employees and one (20%) with
10-12 employees.
Table 1. Profile of Cooperative
CHARACTERISTICS
FREQUENCY PERCENTAGE
Type of Cooperative
Consumer
3
60%
Multi-Purpose
2
40%
TOTAL
5
100%
Year Organized
2003-2008
2
40%
1990-1995
2
40%
1980-1985
1
20%
TOTAL
5
100%
Initial Members when Organized
15-20
2
40%
40-50
2
40%
90-100
1
20%
TOTAL
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 1. Continued…
CHARACTERISTICS
FREQUENCY PERCENTAGE
Initial Paid-Up Share Capital when Organized
4,000-8,000
1
20%
9,000-13,000
2
40%
14,000-18,000
2
40%
TOTAL
5
100%
Number of Directors
4-5
2
40%
6-7
3
60%
TOTAL
5
100%
Number of Employees
1-3
3
60%
4-6
1
20%
10-12
1
20%
TOTAL
5
100%
Cooperative Leaders
Table 2 presents the general information of the respondents such as age, gender,
civil status, educational attainment, occupation, position in the cooperative and years of
membership in the cooperative.
Age. Most (60%) of the respondents are at the age of 40-45 and two (40%) are at
the age bracket of 46-50 wherein the age range of 40-50 are relatively young going to the
golden age.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Gender. The table shows that three (60%) of the respondents are male and two (40%) are
female which implies that males are more likely nominated to manage or run the
cooperative.
Civil status. All (100%) of the respondents are happily married.
Educational attainment. All (100%) of the respondents are high school graduate and
that have attended formal education.
Position in the cooperative. Majority (60%) of the respondents are the manager of
the cooperative and 2 (40%) are the chairman of the board of directors.
Occupation. Aside from being the manager and/or chairman of the board of
directors of the cooperative, all (100%) of the respondents are engaged in farming
activities. Atok is blessed with fertile lands and favorable climate suitable for the
production of various highland crops and thus, all the respondents are into farming.
Years of membership. The table shows that two (40%) of the respondents are members of
the coop for 5-20 years and two (40%) for 15-20 years while only one (20%) of the
respondents is member of the cooperative for 30-35 years. It shows that from the start the
cooperative was organized, they were pioneer members and later became the managers and
chairman of the board of directors.
Table 2. General information of the respondents
CHARACTERISTICS
FREQUENCY
PERCENTAGE
Age
40-45
3
60%
46-50
2
40%
TOTAL
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 2. Continued. . .
CHARACTERISTICS
FREQUENCY
PERCENTAGE
Gender
Male
3
60%
Female
2
40%
TOTAL
5
100%
Civil Status
Married
5
100%
TOTAL
5
100%
Education Attainment
High School Graduate
5
5%
TOTAL
5
100%
Occupation
Farming
5
100%
TOTAL
5
100%
Position in the cooperative
Manager
3
60%
Chairman of the Board
2
40%
TOTAL
5
100%
Years of membership
5-10
2
40%
15-20
2
40%
30-35
1
20%
TOTAL
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Background Information of the Cooperative
Table 3 presents the products and services offered by the cooperatives.
Farm supplies. Majority (80%) of the respondents are into offering farm supplies such as
pesticides, fertilizers and farming materials specifically seedlings. They provide also
trainings and seminars such as application of feed fertilizer or pesticides, animal feed
processing, crop harvesting, quality control postharvest and technology and irrigation
facility maintenance.
Credit. Majority (60%) of the respondents were providing credit to their members
such as crop loans. As Mcleod (2006) stated, cooperative offering credit generates a
common pool of funds in order to provide assistance to its members for productive and
provident purposes. Also, majority (80%) of the respondents are into financing which
specifically deals with the consumers goods like foods and appliances that satisfy the
needs/wants of customers.
Marketing. All (100%) of the respondents were engaged into marketing which deals
with the members’ product or cooperative products. The cooperative market their
members’ product like the Mukosako which is an organic foliar spray for potato blight and
CJDRA wine, made of cidra and yeast; cut flowers specifically carnation, roses, callalily,
siesta, agapantus and snap dragon; rice wine; potato chips and bags, clothes(sewed).
According to Mcleod (2006), the products and processing of raw materials or goods
produced into finished/any end product or its derivative arising from the raw materials
produced by the cooperative members sold in the name or account of the cooperative shall
be deemed a product of the cooperative.
Table 3. Goods/Services offered by the Cooperative
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
PARTICULARS
FREQUENCY
PERCENTAGE
Farm supplies (Fertilizers, Pesticides)
5
100%
TOTAL
5
100%
Credit
Provident/productive loans
4
80%
Financing (common goods, appliances)
4
80%
*Multiple response
Marketing (member products, coop products)
Flowers (carnation, roses)
1
20%
Rice wine
1
20%
Mukosako
1
20%
CJDRA wine
1
20%
Potato chips
1
20%
TOTAL
5
100%
Marketing Strategies of the Cooperative
Table 4-9 shows the marketing strategies adopted by the five selected Cooperatives
in Atok, Benguet, and alsothe cooperatives’ marketing strategies which are successful and
sustainable. And the problems encountered in adopting such strategies in terms of product,
price, place and promotion.
As Elbert and Greffin (2000) stated, marketing managers are responsible for
planning and implementing all the activities that result in the transfer of goods or services
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
to its customers. These activities culminate in the marketing plan-detailed strategy for
focusing marketing efforts on needs and wants. Therefore, marketing strategy begins when
a company identifies a consumer need and develops a product to meet it. In planning and
implementing strategies, marketing managers develop the four basic components of the
marketing mix (product, price, place and promotion).
A. Product Strategies
Table 4 presents the Cooperatives’ strategies in terms of their product, what makes
their product unique, value of the product, their target market and customers problems. As
McCarthy (1960) stated, product is an item that satisfies what a consumer needs or wants.
Marketers must do careful research on how long the life cycle of the product they are
marketing is likely to be and focus their attention on different challenges that arise as the
product moves through each stage.
The marketer must also consider the product mix and how to position the product, how to
exploit the brand, how to exploit the company's resources and how to configure the product
mix so that each product complements the other. The marketer must also consider product
development strategies.
Target market/customers. One hundred percent of the respondents identified the students,
professionals and farmers as their target markets and 60% of the respondents identified
tourist and passers-by as some of their target markets. According to Mrs. Picpican, TMPC
manager, aside from the mentioned target markets and customers others also are the
passers-by specifically passengers and motorist in vans, trucking, private vehicles who
happened to stop in their place and after realizing it is a cooperative store, some of them
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
actually became a member of the cooperativespecially people from of Kibungan, Buguias
and Kabayan.
As Jurado (1982) stated, marketing strategy is an overall program based upon selecting a
particular target of the market on what a customer needs and wants.
Product uniqueness in the market. The result shows that three (60%) of the
respondents says that both utility of the product and product innovation effectiveness are
what made their product unique in the market/customers. Also twenty percent of the
respondents say that product labeling and packaging are what make their product unique.
As one (20%) of the respondent said, what makes their product unique in the
market/customers is that no other products looks like it for they are the only ones producing
that kind of flowers (Carnation) and it is only in their place that this kind of flower can
grow because of their climate and also having the characteristics of being showy, colorful
(complete color like pink, blue, white, red) and long lasting flowers that has become one
of the favorite cut flowers which is excellent for floral bouquet.
Furthermore, their product is unique for having good quality a prolong life span or
shelf life for each member have their own greenhouse where they plant and secure the
quality of the flowers. After harvest, the flowers are conditioned immediately after storage
to counteract slight dehydration during storage and it is done either re-cutting the stem by
about 2-4 cm or by placing in the preservative or warm water of 38-40 degree Celsius for
at least two hours before arranging in a vase or delivering.
One (20%) of the respondents whose product is rice wine stated that the taste of the
wine is just exact, no alcohol and water added and for two (40%) of the respondentssaid
that what makes their CJDRA wine and mukosako unique is that they are the only ones
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
producing that kind of wine and no other products looks like it. And for the potato chips of
one (20%) of the respondent, it has different flavors like cheese and spicy from different
varieties of potato such as granula, raniag and LBR; different sizes like jumbo, super XL
and extra used in the production of potato chips.
According to Elbert and Greffin (2000), one must have a product differentiation that would
make a certain product unique in the market and would promote particular features of the
products in order to distinguish them on the market place. Product differentiation is the
creation of the feature or image that makes a product differ enough from existing product
to attract customers.
Value of the product to customers. The table shows that all (100%) of the respondents’
products provide value to customers and that is customer satisfaction; 60% of the
respondents said reliability; durability and tangibility and helps lessen or make work easier
is the value of their product provided to customers.
One of the respondent stated that other value their product provide to customers is that
having a long shelf life, as Mr. Celo added, their product cannot easily be withered and
destroyed (“mabayag nga mausar, mapakinabangan”). It has variety of colors that
customers can select and also used to make ceremonial crowns and coronations were
decorative head bands made of woven flowers worn by young maidens.
As G0 (1997) imposed, efficiency and effectiveness of a cooperative is not
measured by the amount of profit it makes during a time but on how satisfied the members
and customers are with the service/product rendered.
Problems and concerns that are addressed by the cooperatives’ product and service.
The result shows the multiple responses of the respondents on what are the problems that
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
were addressed by the product. As Go (1997) stated that the product function is to provide
benefits desired by the target market/customers. Majority (80%) of the respondent stated
that farming problems such as crop/plant diseases that according to TMPC they have the
“Mukosako” which is an organic foliar spray from burned ashes and used to control blight
of potatoes; 60% on household problems and 40 % are on sense of belongingness, hunger,
thirst, discomfort and self-image enhancement or affective fulfillment.
Table 4. Product strategies
PARTICULARS
FREQUENCY PERCENTAGE
Target Markets/Customers
Students
5
100%
Professionals
5
100%
Farmers
5
100%
Tourist
3
60%
Passers-by
3
60%
*Multiple response
Product Uniqueness in the Market
Product class dissociation
1
20%
Utility of the product
3
60%
Labeling and packaging
1
20%
Product innovation effectiveness
3
60%
*Multiple response
Table 4. Continued. . .
PARTICULARS
FREQUENCY PERCENTAGE
Value of the Product to Customers
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Reliability
3
60%
Durability and tangibility
3
60%
Meet customers’ needs and wants
5
100%
Helps lessen or make work easier
3
60%
*Multiple response
Customers’ problems that help solved by the product
Sense of belongingness
Hunger, thirst, discomfort
2
40%
Self-image enhancement(affective fulfillment)
2
40%
Farming problems
2
40%
Household problems
4
80%
3
60%
*Multiple response
B. Pricing Strategies
Table 5 presents the pricing strategies of the Cooperatives on how they price their product,
what are their main objective in pricing, what discounts they offer to customers, customers’
price sensitivity and cooperatives’ pricing. As Go (1997) revealed that the price function
is to make the product affordable to target market and reflect the value of benefits provided.
Customers and competition must be considered in setting the prices. Tactics in prices
include variation, discounts, psychological pricing and price lining.Other decisions on
pricing include different ways of pricing, discounts and credits.
Price of the product. The result shows that all (100%) of the respondents price their
product based on production cost plus percentage mark-up.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Main Objective in pricing. All (100%0 of the respondents had the objective to satisfy
customers in pricing their product. And one of the respondents had the objective of greater
return to investment. Majaro, (1993) stated that pricing is a crucial element of marketing
mix because profit implication affects the long term success of any enterprise.
Discounts offer to customers. Twenty percent of the respondents offer bulk
discounting and member discount to customers. Specifically, MBMPC give or offers give-
aways like extra bundles or stems of flowers as their discounts to whoever will buy their
product and sometimes give their customers the privileges to choose and pick the flowers
they wanted right at the green houses. Also for the Mukosako, discount offered is extra
liters or ml of mukosako like 150ml and for the rice wine, potato chips and CJDRA wine
have only member discount.
Customers price sensitivity. All (100%) of the respondents said that with a small decrease
in price it does not gain extra market share wherein if the cooperative lower their price it
results to low profit and with a small increase in price gain extra profitwherein if
cooperative price their product higher it results to higher profit.As the saying of Raymond
Corey stated, the art of pricing is to have the price be an equate to the value of the product
to the customers –anything less than that represents a sacrifice in potential profits.
Cooperative pricing. Two (40%) of the respondents price their products same with
competitors and 20% of the respondents price their product with the demand of the product,
psychological pricing and based on production cost plus percentage mark-up.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 5. Pricing strategies
PARTICULARS
FREQUENCY PERCENTAGE
Price of the Product
Based on production cost plus
percentage mark-up
5
100%
TOTAL
5
100%
Main objective in pricing
Satisfy customers
4
80%
Greater return to investment
1
20%
TOTAL
5
100%
Discounts offer to customers
Bulk discounting
1
20%
Member discount
5
100%
*Multiple response
Customers’ price sensitivity
Small decrease in price doesn’t gain extra
5
100%
market share
Small increase in price gain profit margin
5
100%
*Multiple response
Cooperative’s pricing
Psychological pricing
1
20%
Demand of the product
1
20%
Same with competitors
2
40%
Production cost plus percentage mar-up
1
20%
TOTAL
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
C. Place and Distribution Strategies
Table 6 presents the place and distribution strategies of the Cooperatives that included
where the cooperative is located, why did they choose that location, having that location
who are their target markets, channels of distribution and access to right distribution
channel.
Location of the cooperative. The table shows that majority (60%) of the respondent are
located near the highway and 40% are away from the highway and market area.
Reasons in choosing the location. Almost all (80%) of the respondents chose the location
for its accessibility and 40% choose the location for its safety and customers traffic. While
20% of the respondents specifically ACMPC do not have a choice because there are no
more suitable locations.
Target market. The table shows that all (100%) of the respondents targeted students,
employees and farmers and 60% targets the passers-by.
Channels of distribution. All (100%) of the respondents used direct customers and retailers
as their distribution channels and only 20% uses wholesalers as their channel of
distribution. Hutt and Stull, (1992) said thatthe business has to decide on a channel of
distribution which may be described as a system of people and organization that get product
or service from the producer to the customer. Distribution decisions include deciding on
whether to use a direct or an indirect distribution channel and where the business is to be
located.
Access to right distribution channels. The result showed that all (100%) of the respondents
access the right distribution channels through delivery and pick up and only 20% of the
respondents is through trucking.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 6. Place strategies
PARTICULARS
FREQUENCY PERCENTAGE
Location of the Cooperative
Near the highway
3
60%
Market area
2
40%
Away from the highway
2
40%
*Multiple response
Reasons in Choosing the Location
Accessible
4
80%
Many customers
2
40%
Safer
2
40%
No choice
1
20%
*Multiple response
Target Market
Farmers
5
100%
Employees
5
100%
Students
5
100%
Passers-by
3
60%
*Multiple response
Table 6. Continued. . .
PARTICULARS
FREQUENCY PERCENTAGE
Channels of Distribution
Direct customers
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Retailers
5
100%
Wholesalers
1
20%
*Multiple response
Access to Right Distribution Channels
Delivery
5
100%
Pick up
5
100%
Trucking’s
1
20%
*Multiple response
D. Promotion Strategies
Table 7 presents the promotional strategies of the Cooperatives on the method and ways in
promoting their product, where and when to get across the marketing message to target
market and how does it influence the cooperative choice of promotional activities. As
stated by Rue and Holland (1986), promotional strategy is like a general overall battle plan,
it tells a broad term how a firm will see promotion to secure an advantage over the
competition to attract buyers and capitalize on its resources. A firm’s objective indicates
where it wants to go, and its strategy describes how it will get there and how it will
accomplish its objectives. The most important promotional tools includes advertising,
personal selling, sales promotions and public relations.
Methods of promoting the product. Majority (80%) of the respondents uses
personal selling in promoting their product; 40% uses sales promotion and 20% of the
respondents uses advertising in promoting their product. The result shows that under
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
advertising, only one (20%) of the respondents specifically MBMPC uses fliers, radio and
tarpaulin in advertising their product to attract customers. Other ways is through give-
aways or gifts like for TMPC, they do not have promotional strategies but they considered
giving Cooperative printed t-shirts, umbrella, hat and bags as ways or methods to attract
their customers.
On the other hand, under sales promotion all (100%) of the respondents uses plain product
display. Under getting across the market message to target markets were multiple responses
from the respondents. All (100%) of the respondents get their market message to target
markets during occasions like weddings and birthdays wherein the flowers are needed for
bouquet and floral arrangement also wines for the celebrations; 80% says during festivals
like parades and 60% says during holidays where many students are spending their holidays
in their places and market area on peak seasons.
Influences on the cooperatives’ choice of promotional activity. The result shows that all
(100%) the respondents were influenced by their target market to innovate and develop
their products and services.
As Go (1997) stated, when a product reaches its maturity or even in the marketing message,
the product must gain a new life cycle or continuous product innovation and product
development by adding better feature or giving it a new image of the product.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 7. Promotion Strategies
PARTICULARS
FREQUENCY PERCENTAGE
Ways of promoting the product
Advertising
Radio
1
20%
Tarpaulins
5
100%
*Multiple response
Sales promotion
Plain product display
5
100%
Give aways
2
40%
*Multiple response
Getting across the marketing message
Market area on peak season
3
60%
Occasions
5
100%
Festivals
4
80%
Holidays
3
60%
*Multiple response
How does it influence the coop
Innovation and development
5
100%
TOTAL
5
100%
Successful and Sustainable Marketing Strategies
Table 8 presents that all (100%) of the respondents stated that trainings and
seminars were the strategies which are successful and sustainable to their Cooperatives. As
the managers and chairman of each cooperatives stated, attending trainings and
seminars/programs enhancetheir knowledge on cooperatives that would help them became
more active in the cooperative. Further, Four (80%) of the respondents said that effective
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
and efficient service offered by the cooperative and having focused on common goods and
wants of target markets are also one of the cooperatives marketing strategies.
Also,
two (40%) of the respondents said that one of their strategies is that offering product having
its own/patent brand that attracts customers to buy. As Go (1997) said, product
innovation/development may mean repositioning the product by adding better features,
giving it a new image or own/patent brand for packaging is an important factors in
projecting the product image.
Moreover, 20% of the respondent stated that consistent supply or having the
comparative advantage is what made their cooperative successful and sustainable because
of the consistent supply of the product. For TMPC one strategy that sustains their
cooperative is the lending and social services (“Ammoyong” Death aid) a kind of mutual
fund given in case of death of one person and with this many became a members of the
cooperatives.
Table 8. Successful and Sustainable Marketing Strategies
PARTICULARS
FREQUENCY PERCENTAGE
Products offered have its own
patent/brand that attracts customers to buy
2
40%
Focus is on common goods and wants
4
80%
Trainings and seminars/programs
5
100%
Effective and efficient service offered
4
80%
Consistent supply(comparative advantage)
1
40%
Ammoyong Association and lending services
1
40%
*Multiple Responses
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Problems Encountered in Adopting such Strategies
Table 9 presents the problems encountered by the respondents in adopting such
strategies.
Product strategies. In terms of product strategies, all (100%) of the respondents
encountered lack of raw materials to be used and 40% of the respondents stated limited
production and finance. Funds are not enough to be used in the making or developing of
products. According to one (20%) of respondent, they do not have unique image of their
product for they lack raw materials to be used specially on packaging and labeling as well.
The bottles used for their Mukosako is the coco-cola plastic having no label and as to their
wine it was bottled in an emperador or blue gin bottle.
Furthermore, one (20%)of the respondent admitted that financial support is not enough to
sustain their product, to buy planting materials specially the seedlings which are to be
imported from China, South Korea and Poland and that they do not have the capability or
enough financial support to import seedlings. As a result the respondents just propagate or
generate new seedlings from the past planting but no longer the same quality as time passes.
Price strategies. Majority (60%) of the respondents encountered the problem buyers
preferential differences- wherein some customers are value oriented (want to pay low
prices for acceptable quality) and others want high quality and are willing to pay anything
to get it. Also, 40% of the respondents stated that they pricedtoo low that result to low
profit and 20% of the respondent saidthat price is too high that customers can’t afford it
and price of one of their product can impact sales of other products. One (20%) of the
respondent stated that one of their problems that affect their pricing is the orientation of
customers on the price of one product to be stable/steady all throughout and without
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
considering the quality and demand of the product which is changing and that customers
just say that the price is always the same/alike.
Place and distribution strategies. Majority (80%) of the respondents encountered
limited channels of distribution. Twenty percent of the respondents have a problem on the
distance of production and market site that it takes many hours or days before it reaches
the customers and by that there are tendencies for the product to be damaged during the
transportation.
Promotion strategies. All (100%) of the respondents stated that they have limited
knowledge on promotional strategies. Twenty percent of the respondents do not have
enough resources to be used for the promotional strategies of their product.
Table 9. Problems encountered
PARTICULARS
FREQUENCY PERCENTAGE
Product strategy
Limited production cost
2
40%
Lack of raw materials to be used
5
100%
Financial support is not enough
2
40%
*Multiple response
Price strategy
Price is too high that customers cannot
1
20%
afford to buy it
Price is too low that result to low profit
2
40%
Price of one product can impact sales of
1
20%
other products
Buyers preferential differences
3
60%
*Multiple response
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 9. Continued. . .
PARTICULARS
FREQUENCY PERCENTAGE
Place strategy
Limited channel of distribution
4
80%
Far distribution channels
1
20%
TOTAL
Promotion strategy
Not enough resources
1
20%
Limited knowledge on promotional
5
100%
strategies
Product development
1
20%
*Multiple response
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary
This study was conducted in the five selected cooperatives in Atok, Benguet. It was
conducted to determine the businesses of cooperatives; to identify the marketing strategies
of cooperatives in terms of product, price, place and promotion; to determine the
cooperatives’ marketing strategies which are successful and sustainable and to identify
problems encountered by each cooperative in adopting such strategies
Five management staff and officers (2 chairman and 3 managers) were the key
respondents of the study. A structured questionnaire was employed and personal interview
using the guide questionnaires to gather the needed information and data that were
tabulated analyzed and interpreted using tables and descriptive method like frequency and
percentage analysis.
The results revealed that though some of the cooperatives are registered as multi-
purpose it operates as a consumer type. They offered goods/services which are more on
farm supplies like pesticides, fertilizers; credit and financing (consumers’ goods,
appliances); and marketing (member products, coop products).
The finding showed that the marketing strategies adopted and being used by the
respondents. In terms of product strategies, the respondents have the same target markets,
farmers, professionals, students, and some tourist and passers-by. Their product value is to
meet customers’ needs and wants or customer satisfaction. Likewise in some ways or in
some points to help lessen/make work easier specifically farming problems and household
problems. As to the problems encountered in their product strategies, all the respondents
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
answered lack of raw materials and funds. They lack funds to improve and develop their
product.
Also, in terms of pricing strategies, all the respondents priced their product based
on production cost plus percentage mark-up having the main objective to satisfy customers.
For one (20%) of the respondentsis for greater return to investment. As to the strategies in
pricing their product, they compare with other cooperative or to competitors. Two (40%)
of respondents price their product same with their competitors, one (20%) respondent is
through psychological pricing and one (20%) based on the demand of the product and 20
% based on production cost plus percentage mark-up. With regards to the problems
encountered in the pricing strategies, majority stated that it is buyers preferential
differences where in most of their customers are value oriented (want to pay low prices for
acceptable quality) and others want high quality and are willing to pay anything to get it.
Furthermore, in terms of place and distribution strategies, the finding showed that
majority are located near the highway where it is more accessible and where the customers’
traffic. As to the channels of distribution and right accessibility of distribution channels of
the cooperatives, all respondents used direct customers and retailers and access through
delivery and pick up. Only one (20%) of the respondent used wholesalers and access
distribution channels through trucking aside from the strategy mentioned above. For the
problems encountered by the respondents in the distribution, majority (80%) said they have
limited channels of distribution and one (20%) of the respondent said their problem is far
distance of production and market site.
The results shows that in terms of promotional strategies, all (100%) of the
respondents promote their product through sales promotion which are plain product display
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
and some give aways like printed bags, t-shirt and hat. Under advertising only one (20%)
of the respondent uses radio, tarpaulins in promoting their productsand majority get the
marketing message on occasions, festivals that influence the respondents to the innovation
and development of their product. As to the problems encountered in promotional strategies
all the respondents admitted that besides for not having enough resources, they also have
limited knowledge on promotional strategies.
Successful and sustainable marketing strategies there are: trainings and
seminars/programs, effective and efficient service offered by the cooperatives,
cooperatives focused on common goods and wants; products offered by the cooperative
have its own/patent that attracts customers to buy. In addition, consistent supply of the
product (comparative advantage), social services (Ammoyong Death Aid) and lending
services are what sustain the success of the respondents.
Conclusions
Based on the findings of this study, the followings were drawn:
1. Majority of the cooperatives, though registered as multi-purpose but operates
consumer type and that each cooperative have its own product and services offered to the
customers which are more on financing (consumer’s goods, common goods) , marketing
(coop product, member product), farm supplies, credit (provident loans);
2. In terms of pricing strategies, all the cooperatives price their product based on
production cost plus percentage mark-up, having the main objective of satisfying
customers and offering member and bulk discounting to attracts customers;
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
3. With regards to place strategies, majority of the cooperative are located near the
highway where it is more accessible to target markets, to channels of distribution and
having the right distribution channels through delivery pick up and trucking;
4. The cooperatives uses sales promotion which are plain product display and some
give-ways in promoting their product and most of the cooperative get the marketing
message during occasions and festivals like wedding, birthdays and parade during festivals
wherein flowers are needed for floral arrangement and bouquet and wine for the celebration
that influence them to innovate and develop their product;
5. Cooperatives’ marketing strategies which are successful and sustainable are
trainings and seminars/programs; effective and efficient service offered by the cooperative
importantly the employees/staffs; focus of the cooperative is on common goods and wants;
products offered have its own/patent brand that attracts customer to buy and for some is
the consistent supply (comparative advantage) offered by the cooperative and social service
(Ammoyong, death aid), lending services that help sustain the cooperative; and,
6. Problems encountered by the cooperatives are lack of raw materials to be used in
terms of product strategies; buyers’ preferential differences and price is too low that result
to low profit for pricing strategies; limited and far distribution channels for place strategies
and lack of knowledge on promotional strategies.
Recommendations
Based on the results of the study the following were recommended:
1. Cooperatives must continue in innovating and developing their productfor the
benefit of the members;
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
2. Cooperatives should seek the assistance of the union or federation for some
financial support or assistance;
3. Cooperatives should set a price that complements the product, place, and promotion
and must be aware of the customers’ perceived value for the product;
4. The cooperatives must have pricing efficiency which is concerned with improving
the operation of the buying, selling and pricing in order to remain responsive to consumers’
needs and wants;
5. The cooperatives should look for alternative market outlets for the products
specially the cut flowers, mukosako so that farmers could increase the volume of their
production; and,
6. The cooperatives to tap and avail technical assistance by way of trainings and
seminars regarding marketing strategies; product, price, place and especially promotion
strategies and have continuous cooperative education and trainings to motivate members
to patronize the cooperative.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
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Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
TOYAO, JOANA A. APRIL 2013. Marketing Strategies of Selected Cooperatives
in Atok, Benguet. Benguet State University, La Trinidad, Benguet.
Adviser: David Joseph L. Bognadon, MSc.
ABSTRACT
This study was conducted covering five selected cooperatives in Atok, Benguet. Three
managers and two chairman of the board of directors as key respondents of the study.
Specifically the objectives of this study were to: know what are the businesses the
cooperatives are in; marketing strategies in terms of product, price, place and promotion;
cooperatives’ marketing strategies which are successful and sustainable to the cooperative
and the problems encountered. The results revealed that majority of the cooperatives offer
farm supplies, credit and financing of consumers’ goods. The cooperatives also offer
marketing services for their member products.
Furthermore, the result shows that with regards to each marketing strategies,
cooperatives have their own product uniqueness and value that helps address customers’
needs. Cooperatives priced their products based on production cost plus percentage mark-
up. Having the objective to satisfy customers and they used direct customers, retailers and
promote their product through sales promotion and majority gets their marketing message
on occasions and festivals that influence the cooperatives to the innovations and
development of their product.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Moreover, with regards to the marketing strategies, cooperatives encountered
problems which are in terms of product: lack of raw materials to be used; for price strategy:
buyers’ preferential differences wherein some customers are value oriented; for place
strategy: limited channel of distribution and in terms of promotional strategy is the limited
knowledge on promotional strategies. On the other hand, cooperatives have successful and
sustainable marketing strategies which are trainings and seminars, effective and efficient
service offered products, patent and brand, consistent supply of the product, lending
services and social services (Ammoyong, death aid).
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
INTRODUCTION
Rationale
Atok is a fourth class municipality in the province of Benguet, Philippines. It is
centrally located in the heart of the province of Benguet. It is bounded by the municipality
of Kibungan and Buguias on the north, the municipalities of the Kabayan and Bokod on
the east, the municipality of Kapangan on the west and the municipality of Tublay on the
south. It is politically subdivided into eight (8) barangays wherein from present each of this
barangay had put up their own cooperatives which are either service, consumer, multi-
purpose, producer cooperatives. Most of their cooperatives are multi-purpose, service and
consumer cooperatives. Others put up two cooperatives in each barangay.
Each cooperative have their own approaches and strategies in having more customers and
members. They have their own way of conceptualizing how to market their product and/or
the cooperative itself. Each has their own marketing strategy in helping make their
cooperative successful.
Marketing has become an increasingly vital ingredient for business success and one of the
most important components required for sustainable operation of Cooperatives (Cravens,
1987).
The process of marketing involves meeting needs profitably, identifying and
meeting human and social needs. It is an organizational function and a set of process for
creating, communicating and delivering value to customers and for managing customer
relationships in ways that benefit the organization and its stakeholders (Czepiel, 1992).
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Nowadays, many cooperatives have succeeded but there are also those which failed
for some reasons. One reason can be due to less attention on the marketing aspect of the
cooperatives and also many of the Cooperatives’ managers and/or executives lack
marketing orientation needed in marketing their products and in satisfying their customers.
Also, due to existence of competitors and that they lack strategies in marketing their
products.
Therefore, Cooperatives must develop marketing mix, in other words, managers,
executives and board of directors decide about the most effective composition of the four
components of marketing strategy, namely; product/service, price, place and promotion in
order for the cooperatives to succeed.
Cooperatives are considered to be an instrument for socio-economic development
of the people into a more responsible and more productive citizen. This study will focus on
the marketing strategies of the selected Cooperatives in Atok, Benguet to make comparison
on their similarities and differences that will be an instrument to strengthen anddevelop the
potentials of the people in building up capital for productive investment and empower them
towards economic independence.
Equipped with this set of information, any cooperative will be able to formulate
future effective marketing strategies. This means the questions on what product to sell or
what service to serve, how to price, where to sell, how to sell or promote the product and
service would be best decide upon. Also, Cooperatives would be able to gather the required
information to make wise and sound decisions in formulating and applying marketing
strategies.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Statement of the Problem
The study focused on the marketing strategies of selected Cooperatives in Atok, Benguet.
Specifically, this study answers the following questions.
1. What businesses the cooperatives are in?
2. What are the marketing strategies of cooperatives in terms of product, price, place
and promotion?
3. What are the Cooperatives’ marketing strategies that are successful and
sustainable?
4. What are the problems encountered by the cooperatives in adopting such strategies?
Objective of the Study
The study aimed:
1. To determine what businesses the cooperatives are in;
2. To identify the marketing strategies of cooperatives in terms of products/
services, price, place and promotion;
3. To determine the Cooperatives’ marketing strategies which are
successfuland sustainable; and,
4. To identify the problem encountered by the cooperatives in adopting such
strategies.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Importance of the Study
Since the study is about the marketing strategies of cooperatives, the findings of
this study will provide information to researchers as well as to manager or executives in
their decision making process in making strategies to achieve organizations’ competitive
advantage towards the cooperatives’ success.
Also, the findings of the study will serve as a strategic tool by cooperatives that
enables them to improve strategies in identifying key driving forces and anticipate future
market directions. It helps provide numerous benefits including anticipating competitors’
actions improve teamwork, promote learning and innovation within the organization.
Furthermore, the study will serve as a reference for students and researchers
intending to study marketing strategies.
Scope and Delimitation of the Study
The study focused on the marketing strategy of selected Cooperatives in Atok, Benguet. It
is delimited to managers and chairman of the board of directors of every selected
cooperative in Atok, Benguet.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
REVIEW OF LITERATURE
Marketing Strategy Defined
Marketing strategy is a process that can allow an organization to concentrate its resources
on the optimal opportunities with the goals of increasing sales and achieving a sustainable
competitive advantage. Marketing strategies includes all basic and long-term activities in
the field of marketing that deal with the analysis of the strategic initial situation of a
company and the formulation, evaluation and selection of market-oriented strategies and
therefore contribute to the goals of the company and its marketing objectives (Kohls and
Downy, 1972).
Marketing strategies serve as the fundamental underpinning of marketing plans designed
to fill market needs and reach marketing objectives. Plans and objectives are generally
tested for measurable results. Commonly, marketing strategies are developed as multi-year
plans, with a tactical plan detailing specific actions to be accomplished in the current year.
Marketing strategies are dynamic and interactive. They are partially planned and partially
unplanned (Evans and Berman, 1990).
Marketing strategy involves careful scanning of the internal and external environments.
Internal environmental factors include the marketing mix, plus performance analysis and
strategic constraints. External environmental factors include customer analysis, competitor
analysis, target market analysis, as well as evaluation of any elements of the technological,
economic, cultural or political/legal environment likely to impact success. A key
component of marketing strategy is often to keep marketing in line with a company's
overarching mission statement. Once a thorough environmental scan is complete, a
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
strategic plan can be constructed to identify business alternatives, establish challenging
goals, determine the optimal marketing mix to attain these goals, and detail
implementation. A final step in developing a marketing strategy is to create a plan to
monitor progress and a set of contingencies if problems arise in the implementation of the
plan (Aaker, 2008).
Cooperative Defined
Cooperatives (Laidlaw, 1974) are duly registered association of persons with common
bond of interest, who voluntarily joined together to achieve a lawful common social and
economic end, making equitable contributions to the capital required and accepting a fair
share of the risks and benefits of the undertaking in accordance with universally accepted
cooperatives principles.
Moreover, cooperative as defined by Grove (1985) is an autonomous association of persons
united voluntarily to meet their common economic, social and cultural needs and
aspirations through a jointly owned and democratically controlled enterprise. It has their
own principles, strategies and approaches in managing their cooperatives.
Classification of Cooperatives
According to Mcleod (2006) the business or enterprise of cooperatives may be classified
as to activities.
Credit cooperative. Promotes and undertakes savings and lending services among
its members. It generates a common pool of funds in order to provide financial assistance
to its members for productive and provident purposes.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Consumer cooperative. The primary purpose is to procure and distribute
commodities to members and non-members. It aims at fulfilling the needs and aspirations
of their members and further uniting consumers for joint purchases and for the production
of consumers’ goods and subsequent sales of these goods to its members and the
population.
Producer cooperative. It undertakes joint production whether agricultural or industrial. The
production and processing of raw materials or goods produced by its members into finished
or processed products for sale by the cooperative to its members and non-members. Any
end product or its derivative arising from the raw materials produced by its members sold
in the name and for the account of the cooperative, shall be deemed a product of the
cooperative and its members.
Marketing cooperative. It engages in the supply of production inputs to members and
marketing their products. It specializes in providing its members with marketing services,
bringing goods from the producers to the consumers. Maybe considered as a process of
marketing producer which enables the growers to market their produce at better prices,
followed by the intention of securing better marketing services and ultimately contributing
to improvement in the standard living of members.
Service cooperative. It provides service to their members. Also, it engages in the medical
and dental care, hospitalization, transportation, insurance, housing labor, electric light and
power, communication professional and other services. It is important part of the definition
of a service cooperative and provides clues to its nature and its method of working. It means
for example that it does not provide services to other than its members and therefore the
user of its services must become members.
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Multi-purpose cooperative. This combines two or more of the business activities of a
cooperative. For instance the cooperative serviceis a combination of credit lending
production and provision of consumer goods.
Functions Performed by Cooperatives
Cooperatives may perform one or more three core functions; marketing products,
purchasing supplies and providing services ( McLeod, 2006).
Marketing cooperative. It assist members maximize the return they receive for goods they
produce. Most cooperative marketing activity involves either agricultural products or those
of producers in related industries such as forestry, aquaculture and horticulture. New
marketing ventures are developing in such diverse industries as handicrafts, professional
services and information technology. Some marketing cooperatives limit their activity to
negotiating prices and terms of sale with buyers. Growers of fruits and vegetables for
processing and dairy farmers are primary users of these cooperatives.
Other marketing associations assemble member production into large quantities for sale
to further processors, wholesalers or retailers. This first-handler role is common for
cooperatives of grain growers and producers of fruits and vegetables for the fresh produce
market.
Furthermore, marketing cooperative add further value to member production by processing
or manufacturing member products into other more valuable products. These may serve as
ingredients in further processed products or be sold to institutional buyers and restaurants
for their direct use, to grocery chains for resale as private label products, or to brand-name
companies for resale under their brand. Cooperatives that process dairy products, fruits,
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TOYAO, JOANA A. APRIL 2013
vegetables, grains, fish, and lumber exemplify these value-added processing activities.
Marketing cooperatives enable members to extend control of their products and realize
additional margins through processing, distribution and sale.
Purchasing cooperatives. These were first used by farmers to gain access to affordable,
quality production supplies such as feed, fuel, fertilizer and seed. These early efforts often
became businesses having full-time managers and warehouses to handle other production
supplies and services such as farm chemicals, animal health products, fencing, building
supplies, construction contracting, automotive accessories, etc. Many local purchasing
cooperatives have affiliated with other such organizations, often through regional and
national federated cooperatives. These efforts reduce member costs and strengthen their
purchasing power through direct ownership of large-scale facilities. Today many nonfarm
businesses have developed supply purchasing cooperatives to gain access to the same
volume discounts and quality control assurances long available to farmers. These include
hardware stores, independent grocery stores and fast food restaurant franchisees
Service cooperatives. These were also developed to serve farmers. Some of these services
are farm-specific such as recommending and applying fertilizer, lime, or pesticides; animal
feed processing and crop harvesting. Others are general in nature such as credit through the
Farm Credit System, electricity through rural electric cooperatives and communications
service through rural telephone cooperatives. Nonagricultural service cooperatives are also
flourishing. Credit unions and the National Cooperative Bank provide credit on a
cooperative basis to nonfarm individuals and cooperatives. School systems, health care
providers, and insurance buyers are among the general public segments making use of
service cooperatives.
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Benefits of Cooperatives
People buy stock in a non-cooperative business to make money on their investment. The
more of the company you own, the more benefits (stock appreciation and dividends) you
will realize if the business succeeds.
According to Dogarawa (n.d.) the benefits of being a cooperative member differ in
two ways. First, the advantages are more numerous. Second, they are distributed on the
basis of how much use you make of the cooperative, rather than your equity stake. Here
are some benefits of cooperative membership and how they relate to use.
Access to quality supplies and services at reasonable cost. By banding together and
purchasing business supplies and services as a group, individuals offset the market power
advantage of firms providing those supplies. You can gain access to volume discounts and
negotiate from a position of greater strength for better delivery terms, credit terms, and
other arrangements. Suppliers will be more willing to discuss customizing products and
services to meet your specifications if the purchasing group provides them sufficient
volume to justify the extra time and expense.
The larger the group purchasing supplies and services through the cooperative, the greater
the potential for savings. And the more each individual member uses the supply operation,
the more he or she may save over doing business elsewhere.
Also, cooperative members are to manufacture their own supplies and hire experts directly
to provide essential services. This gives members even more reliable sources of supply and
greater control over the types of products available, the cost and the quality of the services
received.
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Increased clout in the marketplace. Marketing on a cooperative basis like purchasing
supplies and services, permits members to combine their strength while maintaining their
status as independent business people. They can lower distribution costs, conduct joint
product promotion, and develop the ability to deliver their products in the amounts and
types that will attract better offers from purchasers. Through cooperative marketing,
members can share information and negotiate with buyers from a position of greater
strength and security. They can also develop processing facilities by themselves or as part
of a joint venture with other cooperative or non-cooperative firms.
A cooperative can also serve as a vehicle for people selling goods and services to work
with their customers to promote industry research, reduce regulatory burdens, and develop
markets for their products. The cooperative can help create a "win-win" situation for the
entire industry, a business environment where both producers and buyers have more
income.
Share in the earnings. Some people talk about non-cooperative firms operating "for profit"
while cooperatives operate "at cost." This isn't totally accurate. Most cooperatives generate
earnings. They differ from non-cooperative firms in how they allocate and distribute their
earnings.
A non-cooperative firm retains its earnings for its own account, or perhaps pays part
of them out to shareholders as dividends, based on the amount of stock each investor owns.
In a cooperative, earnings are usually allocated among the members on the basis of the
amount of business each did with the cooperative during the year. Permitting their
cooperative to accumulate retained patronage refunds is a relatively easy and painless way
for members to help finance activities and growth. Also, if certain rules are followed, the
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TOYAO, JOANA A. APRIL 2013
cooperative may deduct both the cash pay-outs and the retained patronage refunds from its
taxable income. This makes cooperative earnings particularly valuable.
Political action. Growers, small business owners, and other rural residents have to realize
that no one gives you a favorable law or regulatory ruling just because you think you
deserve it. You have to build your case and argue your point convincingly. A cooperative
gives people a means to organize for effective political action. They can meet to develop
priorities and strategies. They can send representatives to meet with legislators and
regulators. These persons will have more influence because they will be speaking for many
and not just for themselves.
They can also form coalitions with other groups having similar views on issues. The
larger the voice calling for a specific action, the more likely that the system will respond
with the policy you desire.
Local economy enhanced and protected. Having its businesses owned and controlled on a
cooperative basis helps your entire community. Cooperatives generate jobs and salaries for
local residents. They pay taxes that help finance schools, hospitals and other community
services.
When a business is a cooperative, your town is less likely to lose those jobs and taxes.
A business owned by one person or a subsidiary of a big company, can easily be moved to
another community. When many local people share the ownership of a cooperative, no
individual or company can take it from your area or simply close it. Only the membership
as a whole can make such decisions.
Role of Cooperative in Economic Development
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Cooperatives are community-based, rooted in democracy, flexible and have participatory
involvement which makes them well suited for economic development (Gertler, 2001). The
process of developing and sustaining a cooperative involves the processes of developing
and promoting community spirit, identity and social organization as cooperatives play an
increasingly important role worldwide in poverty reduction, facilitating job creation,
economic growth and social development (Gibson,2005).
Cooperatives are viewed as important tools for improving the living and working
conditions of both women and men. Since the users of the services they provide owned
them, cooperatives make decisions that balance the need for profitability with the welfare
of their members and the community which they serve. As cooperatives foster economies
of scope and scale, they increase the bargaining power of their members providing them
among others benefits, higher income and social protection. Hence, cooperatives accord
members opportunity, protection and empowerment -essential elements in uplifting them
from degradation and poverty (Somavia, 2002). As governments around the world cut
services and withdraw from regulating markets, cooperatives are being considered useful
mechanisms to manage risk for members and keep markets efficient (Henehan, 1997). In a
number of ways, cooperatives play important role in global and national economic and
social development. With regard to economic and social development, cooperatives
promote the “fullest participation of all people” and facilitate a more equitable distribution
of the benefits of globalization. They contribute to sustainable human development and
have an important role to play in combating social exclusion. Thus, the promotion of
cooperatives should be considered as one of the pillars of national and international
economic and social development (Levin, 2002).
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In addition to the direct benefits they provide to members, cooperatives strengthen the
communities in which they operate. According to Somavia (2002), cooperatives are
specifically seen as significant tools for the creation of decent jobs and for the mobilization
of resources for income generation. Many cooperatives provide jobs and pay local taxes
because they operate in specific geographical regions. According to Levin (2002), it is
estimated that cooperatives employ more than100 million men and women worldwide.
Cooperatives can provide locally needed services, employment, circulate money locally
and contribute to a sense of community or social cohesion. They can provide their
employees with the opportunities to upgrade their skills through workshops and courses
and offer youth in their base communities short and long-term employment positions.
Students could also be employed on casual-appointment basis during long vacations.
Through these, cooperatives will contribute to economic development.
Challenges of Cooperative Societies
Cooperatives over the world are in a state of flux. In almost all parts of the world,
cooperatives face one or more of the following crises: crisis of ideology, crisis of capital,
crisis of credibility and crisis of management (Taimni, 1997). Cheney (1995) identified
challenges facing cooperatives. These are cultural transformation, competition and
expansion, wage solidarity, centralization and reorganization, strategies and approaches
and programme to increase productivity and participation. Groves (1985) on the other
hand, posits that one of the major problems of cooperatives is how to keep balance in the
two parts of cooperative business’ efficiency and democracy, since those who are charged
with the operation of a cooperative chiefly, the board and manager must serve two masters:
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the imperatives of good business practice and the social purpose of a community of people.
Hence, to maintain their special character, cooperatives must be two things in one: a
business organization and a social movement. This is what makes a cooperative a business
enterprise with a human face and so very difficult to manage. In striving for efficiency,
cooperatives often tend to imitate other business, but in pursuing a social purpose they
bring out the features which make them different (Laidlaw, 1974). Educating,
training
and retraining of members in general and officers in particular are always a challenge to
cooperatives especially in developing countries. A cooperative without a strong component
of education is in danger of losing its essential character, that is, the human and personal
characteristics which distinguish it as a cooperative. Education is of paramount importance
to the cooperative sector. Unless all those responsible for cooperatives (directors, officers,
members, staff) are well informed and knowledgeable, cooperatives are likely, in some
countries, to become much like capitalist, profit-seeking business, or in other countries to
become handmaids of the State. Education makes people easy to lead, but difficult to drive;
easy to govern but impossible to enslave. Assuming the validity of the sector concept (the
"mixed economy", as it is often called), cooperators face such questions as what type of
business activity is most suitable for each of the three sectors, public, private and
cooperative? Are there certain kinds of business that rightfully belong to the public sector?
Are there others which are best left to private enterprise? What kinds ideally, are most
suitable for the cooperative way of business? Are there some fields in which all three may
engage and compete? Hence, one other challenge that cooperative societies face is the
choice of business most suitable for the enterprise.
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Another challenge facing cooperatives is adaptation. No business in a national economic
system is completely independent and self-sufficient but operates in conditions of
dependence and interdependence. Similarly, the State and public enterprise depend greatly
on private enterprise or on cooperatives. Sometimes, private-profit business depends on
cooperatives. And of course, the reverse, cooperatives depending on private business in
some way or other, is quite common. Thus, cooperatives cannot be thought of as an
exclusive economic system but rather as one section of the total economy. They constantly
operate in co-existence with other forms of business and sometimes in conjunction with
them. Co-operatives therefore, have to adapt themselves by struggle in one place, by
agreement in another to the elements of a complex environment, partly free and partly
organized. It must now decide what place it means to claim for itself in the new economy,
either organized orin process of organization.
In addition, the cooperative sector suffers from an internal handicap of its own making; the
frequent failure of various types of cooperatives to work closely together as a sector.
Because of their voluntary and democratic nature, cooperatives have been reluctant to
impose strict disciplines on themselves - they much prefer to act by common consent and
persuasion. Often, management of cooperatives relies on relationship or is moved by
sympathy to act against even the societies’ bylaws. Cooperation among Cooperatives, the
different needs of customers, members, patrons, and owners challenges the cooperative’s
board of directors and manager to make good business decisions. Business earnings of the
cooperative must be great enough to systematically rotate the investment of members, pay
patronage, and offer goods and services at reasonable prices or pay fair market value for
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customer’s products. This unique business structure dictates that the manager, board of
directors and members understand the business and cooperative structure.
Marketing Mix Element
Marketing activities comes in all forms. One traditional depiction of marketing
activities is in terms of marketing mix, which has been defined as a set of marketing tools
the firm uses to pursue its marketing objectives and strategies and was classified as the four
P’s of marketing, product, price, place, promotion. Marketing mix decisions must be made
for influencing the trade channels as well as final consumers (Kotler, 1986).
Marketing mix helps the company to determine what goods or product to offer, to
decide what distribution mix to use, to inform customers and determine the overall level of
price. The main concept of marketing mix depends on number of decisions with regards to
the four major variables of the four P’s (Kotler, 2000).
Rue and Holland (1986) states that marketing mix strategy is also familiar as the
four P’s of marketing (product, place, price, promotion) provides a good starting point for
consideration of the requirements of strategy implementation in the marketing function.
Marketing strategy is an overall program based upon selecting a particular target of the
market (Jurado and Llanes, 1982).
A company’s marketing managers are responsible for planning and implementing
all the activities that result in the transfer of goods or services to its customers. These
activities culminate in the marketing plan-detailed strategy for focusing marketing efforts
on needs and wants. Therefore, marketing strategy begins when a company identifies a
consumer need and develops a product to meet it. In planning and implementing strategies,
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marketing managers develop the four basic components of the marketing mix. (Elbert and
Greffin, 2000).
The Product
It is seen as an item that satisfies what a consumer needs or wants. It is a tangible good or
an intangible service. Every product is subject to a life-cycle including a growth phase
followed by a maturity phase and finally an eventual period of decline as sales falls.
Marketers must do careful research on how long the life cycle of the product they are
marketing is likely to be and focus their attention on different challenges that arise as the
product moves through each stage. The marketer must also consider the product mix.
Marketers can expand the current product mix by increasing a certain product line's depth
or by increasing the number of product lines. Marketers should consider how to position
the product, how to exploit the brand, how to exploit the company's resources and how to
configure the product mix so that each product complements the other. The marketer must
also consider product development strategies (McCarthy, 1960).
Marketing begins with a product- a good, a service or an idea designed to fill a consumer
need or want. Conceiving and developing new products is a constant challenge for
marketers, who must always consider the factor of change- changing of technology,
changing consumer wants and needs, and changing economic conditions. Marketing
consumer needs often means changing existing products to keep face emerging markets
and competitors.
Product differentiation. Producers often promote particular features of products in order to
distinguish them on the market place. Product differentiation is the creation of the feature
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or image that makes a product differ enough from existing products to attract customers
(Elbert and Greffin, 2000).
Go (1997) states that the product function is to provide benefits desired by the target in its
feature like quality, service, brand packaging. Considering the product life cycle, when a
product reaches maturity before its decline, the product must gain a new life cycle. To do
this, continuous product innovation and product development are a requirement.
Innovation may mean repositioning the product by adding better feature or giving it a new
image or developing new concepts, system and approaches. Packaging is an important
factor in projecting the product image.
The Price
“The art of pricing is to have the price be an equate to the value of the product to the
customers –anything less than that represents a sacrifice in potential profits.”
E. Raymond Corey
The price is the amount a customer pays for the product. The price is very important as it
determines the company's profit and hence, survival. Adjusting the price has a profound
impact on the marketing strategy, and depending on the price elasticity of the product, often
it will affect thedemand and sales as well. The marketer should set a price that complements
the other elements of the marketing mix. When setting a price, the marketer must be aware
of the customer perceived value for the product. Three basic pricing strategies are: market
skimming pricing, market pricing and neutral pricing.
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The 'reference value' (where the consumer refers to the prices of competing products) and
the 'differential value' (the consumer's view of this product's attributes versus the attributes
of other products) must be taken into account (McCarthy, 1960).
The second critical marketing mix tool is the price. The concept of price is the amount paid
by the customers for a certain product or service. This can also be defined as a certain value
paid by the user of a certain product. Price can make many forms, but in the final analysis
it is what a buyer pays a seller for a product, service, license or future obligation. A product
price may be termed as a list price, sales or markdown price. A price for service may be
referred as fee or tuition (Holland, 2000).
In marketing mix, price is the only element that produces revenue, all other marketing mix
represent cost. Price is also one of the most flexible elements of the marketing mix where
it can be changed quickly. Price affects most the demand, the company’s sales, the market
share and profit. The price indicates to companies what to produce and who will be their
customers.
Go (1997) revealed that the price function is to make the product affordable to target market
and reflect the value of benefits provided. Customers and competition must be considered
in setting the prices. Tactics in prices include variation, discounts, psychological pricing
and price lining.
Rue and Holland (1986) states that pricing must be considered in relation to costs,
consistency and potential inflation. Benefits of well-conceived pricing include increasing
sales to current customers, attracting new customers, maximizing short-run cash flow, and
maintaining an established position. Pricing product through the prevailing price is another
strategy in commonly practiced. The price for the service is reasonable and fair; moreover,
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much competition was noted with the presence of the same services within the vicinity
(Mahmood, 1996).
Pricing is also a crucial element of marketing mix because profit implication affects the
long term success of any enterprise. Many factors influence pricing decision, for example
is cost, competition, type of product or service, image, supply and demand, environmental
factors such as legislation, taxes and exchange rates. Other decisions on pricing include
different ways of pricing, discounts and credits (Majaro, 1993).
The Promotion
It represents all of the methods of communication that a marketer may use to provide
information to different parties about the product. Promotion comprises elements such as:
advertising, public relations, personal selling and promotion. Advertising covers any
communication that is paid for, from cinema commercials, radio and Internet
advertisements through print media and billboards. Public relations is where the
communication is not directly paid for and includes press releases, sponsorship deals,
exhibitions, conferences, seminars or trade fairs and events (McCarthy, 1960).
Promotion has its own task in the marketing mix to communicate to the customers what
the other elements offer. The promotion of a product communicates what market or what
must be done to satisfy consumer’s needs. The promotion component of the marketing mix
includes four major elements such as personal selling, advertising, sales promotion and
public relation. Almost all promotion conveys some kind of information about the product
and service availability and use. It informs the customers about the functional and
psychological needs the product is designed to satisfy. Promotion is also to remind the
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customers that the product is still available. It also communicates directly or indirectly
through words and sounds. Promotion is done either to effectively inform and persuade
target market or to offer a positive image of the company and brand which convince
customers to buy (Go, 1997).
A promotional strategy is like a general overall battle plan, it tells a broad term how a firm
will see promotion to secure an advantage over the competition to attract buyers and
capitalize on its resources. A firm’s objective indicates where it wants to go, and its strategy
describes how it will get there and how it will accomplish its objectives. The most
important promotional tolls includes advertising, personal selling, sales promotions and
public relations (Rue and Holland, 1986).
The Place
It refers to providing the product at a place which is convenient for consumers to access.
Place is synonymous with distribution. Various strategies such as intensive distribution,
selective distribution, exclusive distribution and franchising can be used by the marketer
to complement the other aspects of the marketing mix.
Furthermore, place is usually referred to as the channel or distribution. This has been very
important in business. It is very important to have the product at the right place. Having
the product at the right place is to go near the target market customer. Bringing the product
to the target customer is to minimize cost in the business. The purpose is to make the
product available and accessible to target customers. Traditional concept of physical
distribution typically started at the plant and involved bringing low cost solution to get
them to customers (Holland, 1986).
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Go (1997) states that place is otherwise seen as distribution and its function is to make the
product conveniently available to make market consistent with its purchasing patterns.
Influencing factors may be the customers, product or competition are the external factors
and as for the initial factors is the experience, production (control requirements as of the
transportation cost and economic aspect). The distribution system brings the product or
service to the place where it can best fill customer’s needs. Access to distribution can mean
the difference between success and failure for new product.
Placing a product in the proper outlet-say, a retail store requires decisions about several
activities, all of which are concerned with getting the product from the producer to the
consumer. Distribution is also all about finding the best outlet for costumers to receive the
products and/or services the cooperatives offer. Distribution is establishing a system that
gets the product to where the customers want to buy it (Majaro, 1993). The business has to
decide on a channel of distribution which may be described as a system of people and
organization that get product or service from the producer to the customer. Distribution
decisions include deciding on whether to use a direct or an indirect distribution channel
and where the business is to be located (Hutt and Stull, 1992).
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Definition of Terms
Clout. Special advantage or influence; advantage, vantage - the quality of having a superior
or more favorable position; "the experience gave him the advantage over me".
Combating. To fight or contend against; oppose vigorously; to struggle and strive in
conflict.
Joint venture. A joint venture (JV) is a business agreement in which parties agrees to
develop, for a finite time, a new entity and new assets by contributing equity. They exercise
control over the enterprise and consequently share revenues, expenses and assets.
Strategies. As a way of action, becomes necessary in a situation when, for the direct
achievement of the main goal, the available resources are not enough. The task of strategy
is an efficient use of the available resources for the achievement of the main goal. Tactics
is the tool to implement strategy, and is subordinated to the main goal of strategy.
Sustainable. Refers to a mode of human development in which resource use aims to meet
human needs while preserving the environment so that these needs can be met not only in
the present, but also for generations to come; capable of being sustained; capable of being
continued with minimal long-term effect on the environment: sustainable agriculture.
Successful. Having a favorable outcome; having obtained something desired or intended;
having achieved wealth or eminence.
Intrinsic value. Create a new desire or the ability to satisfy needs and wants
Product innovation effectiveness. Developing new product and giving new image.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
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METHODOLOGY
Locale and Time of the Study
In order to obtain the desired information, this study was conducted from January to
February 2013 in Atok, Benguet.
Respondents
The respondents of the study were managers and chairman of the board of directors of
primary selected Cooperatives in Atok, Benguet. Specifically the Abiang Community
Multi-Purpose Cooperative (ACMPC), Banayakew Multi-Purpose Cooperative (BMPC),
Caliking Consumer Multi-Purpose Cooperative (CCMPC), Mountain Blooms Multi-
Purpose Cooperative (MBMPC) and Topdac Mtulti-Purpose Cooperative (TMPC).
Research Instrument
Survey questionnaire was employed in the study. Personal interview was conducted to
validate information gathered in the survey questionnaire.
Data Gathered
The data gathered were the marketing strategies in terms of product, price, place
and promotions of selected primary cooperatives in Atok, Benguet. It includes the
marketing strategies which are successful and sustainable and the problems encountered in
adopting such strategies.
Data Analysis
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The data collected were categorized, tabulated and interpreted according to
theobjectives of the study using tables and descriptive method like frequency and
percentage analysis.
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Figure 1. Location Map of the Study
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RESULTS AND DISCUSSION
Profile of Cooperative
Table 1 presents the profile of the five selected Cooperatives in Atok, Benguet. It
included the type of Cooperative, when was it organized, initial members and initial paid-
up share capital, number of directors and employees.
Type of cooperative. Three (60%) of the respondents are consumer type and two
(40%) are operating both consumer and credit type. It implies that though the cooperative
is registered as a multi-purpose it does not necessarily mean that the cooperative is
operating two or more activities. Some just mainly operate as consumer store.
Year organized. The table shows that two (40%) of the respondents were organized
within the year range 2003-2008 and two (40%) from 1990-1995 and only one (20%)
respondents was organized within 1980-1985. It shows that TMPC is the oldest cooperative
and ACMPC is the youngest cooperative among the five.
Initial members when organized. The result shows that when the cooperative was
organized, two (40%) of the respondents had initial members ranging from 15-20 members
and two (40%) from 40-50 members and only one (20%) had the initial member of 90-100
members. It implies that the cooperative that was organized first have the largest initial
members and those cooperatives that were organized lately have few initial members.
Initial paid-up share capital when organized. The table shows that only one (20%)
of the respondents have the initial paid-up share capital ranging from 4,000-8,000 pesos
while two (40%) of the respondents from 9,000-13,000 and two (40%) from 14,000-
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18,000. It shows that the Cooperatives’ initial paid up share capital when organized was
quite small, lesser than Php 20,000.
Number of directors. Table 1 shows the number of members comprising the board of
directors in each cooperative. Ideally a cooperative should have at least minimum of five
directors and a maximum of fifteen. The result shows that two (40%) of the cooperatives
have 4-5 directors and 3 (60%) have 6-7 directors.
Number of employees. The table shows that three (60%) of the cooperatives have one to
three employees, one (20%) of the cooperative have 4-6 employees and one (20%) with
10-12 employees.
Table 1. Profile of Cooperative
CHARACTERISTICS
FREQUENCY PERCENTAGE
Type of Cooperative
Consumer
3
60%
Multi-Purpose
2
40%
TOTAL
5
100%
Year Organized
2003-2008
2
40%
1990-1995
2
40%
1980-1985
1
20%
TOTAL
5
100%
Initial Members when Organized
15-20
2
40%
40-50
2
40%
90-100
1
20%
TOTAL
5
100%
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Table 1. Continued…
CHARACTERISTICS
FREQUENCY PERCENTAGE
Initial Paid-Up Share Capital when Organized
4,000-8,000
1
20%
9,000-13,000
2
40%
14,000-18,000
2
40%
TOTAL
5
100%
Number of Directors
4-5
2
40%
6-7
3
60%
TOTAL
5
100%
Number of Employees
1-3
3
60%
4-6
1
20%
10-12
1
20%
TOTAL
5
100%
Cooperative Leaders
Table 2 presents the general information of the respondents such as age, gender,
civil status, educational attainment, occupation, position in the cooperative and years of
membership in the cooperative.
Age. Most (60%) of the respondents are at the age of 40-45 and two (40%) are at
the age bracket of 46-50 wherein the age range of 40-50 are relatively young going to the
golden age.
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Gender. The table shows that three (60%) of the respondents are male and two (40%) are
female which implies that males are more likely nominated to manage or run the
cooperative.
Civil status. All (100%) of the respondents are happily married.
Educational attainment. All (100%) of the respondents are high school graduate and
that have attended formal education.
Position in the cooperative. Majority (60%) of the respondents are the manager of
the cooperative and 2 (40%) are the chairman of the board of directors.
Occupation. Aside from being the manager and/or chairman of the board of
directors of the cooperative, all (100%) of the respondents are engaged in farming
activities. Atok is blessed with fertile lands and favorable climate suitable for the
production of various highland crops and thus, all the respondents are into farming.
Years of membership. The table shows that two (40%) of the respondents are members of
the coop for 5-20 years and two (40%) for 15-20 years while only one (20%) of the
respondents is member of the cooperative for 30-35 years. It shows that from the start the
cooperative was organized, they were pioneer members and later became the managers and
chairman of the board of directors.
Table 2. General information of the respondents
CHARACTERISTICS
FREQUENCY
PERCENTAGE
Age
40-45
3
60%
46-50
2
40%
TOTAL
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 2. Continued. . .
CHARACTERISTICS
FREQUENCY
PERCENTAGE
Gender
Male
3
60%
Female
2
40%
TOTAL
5
100%
Civil Status
Married
5
100%
TOTAL
5
100%
Education Attainment
High School Graduate
5
5%
TOTAL
5
100%
Occupation
Farming
5
100%
TOTAL
5
100%
Position in the cooperative
Manager
3
60%
Chairman of the Board
2
40%
TOTAL
5
100%
Years of membership
5-10
2
40%
15-20
2
40%
30-35
1
20%
TOTAL
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Background Information of the Cooperative
Table 3 presents the products and services offered by the cooperatives.
Farm supplies. Majority (80%) of the respondents are into offering farm supplies such as
pesticides, fertilizers and farming materials specifically seedlings. They provide also
trainings and seminars such as application of feed fertilizer or pesticides, animal feed
processing, crop harvesting, quality control postharvest and technology and irrigation
facility maintenance.
Credit. Majority (60%) of the respondents were providing credit to their members
such as crop loans. As Mcleod (2006) stated, cooperative offering credit generates a
common pool of funds in order to provide assistance to its members for productive and
provident purposes. Also, majority (80%) of the respondents are into financing which
specifically deals with the consumers goods like foods and appliances that satisfy the
needs/wants of customers.
Marketing. All (100%) of the respondents were engaged into marketing which deals
with the members’ product or cooperative products. The cooperative market their
members’ product like the Mukosako which is an organic foliar spray for potato blight and
CJDRA wine, made of cidra and yeast; cut flowers specifically carnation, roses, callalily,
siesta, agapantus and snap dragon; rice wine; potato chips and bags, clothes(sewed).
According to Mcleod (2006), the products and processing of raw materials or goods
produced into finished/any end product or its derivative arising from the raw materials
produced by the cooperative members sold in the name or account of the cooperative shall
be deemed a product of the cooperative.
Table 3. Goods/Services offered by the Cooperative
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
PARTICULARS
FREQUENCY
PERCENTAGE
Farm supplies (Fertilizers, Pesticides)
5
100%
TOTAL
5
100%
Credit
Provident/productive loans
4
80%
Financing (common goods, appliances)
4
80%
*Multiple response
Marketing (member products, coop products)
Flowers (carnation, roses)
1
20%
Rice wine
1
20%
Mukosako
1
20%
CJDRA wine
1
20%
Potato chips
1
20%
TOTAL
5
100%
Marketing Strategies of the Cooperative
Table 4-9 shows the marketing strategies adopted by the five selected Cooperatives
in Atok, Benguet, and alsothe cooperatives’ marketing strategies which are successful and
sustainable. And the problems encountered in adopting such strategies in terms of product,
price, place and promotion.
As Elbert and Greffin (2000) stated, marketing managers are responsible for
planning and implementing all the activities that result in the transfer of goods or services
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
to its customers. These activities culminate in the marketing plan-detailed strategy for
focusing marketing efforts on needs and wants. Therefore, marketing strategy begins when
a company identifies a consumer need and develops a product to meet it. In planning and
implementing strategies, marketing managers develop the four basic components of the
marketing mix (product, price, place and promotion).
A. Product Strategies
Table 4 presents the Cooperatives’ strategies in terms of their product, what makes
their product unique, value of the product, their target market and customers problems. As
McCarthy (1960) stated, product is an item that satisfies what a consumer needs or wants.
Marketers must do careful research on how long the life cycle of the product they are
marketing is likely to be and focus their attention on different challenges that arise as the
product moves through each stage.
The marketer must also consider the product mix and how to position the product, how to
exploit the brand, how to exploit the company's resources and how to configure the product
mix so that each product complements the other. The marketer must also consider product
development strategies.
Target market/customers. One hundred percent of the respondents identified the students,
professionals and farmers as their target markets and 60% of the respondents identified
tourist and passers-by as some of their target markets. According to Mrs. Picpican, TMPC
manager, aside from the mentioned target markets and customers others also are the
passers-by specifically passengers and motorist in vans, trucking, private vehicles who
happened to stop in their place and after realizing it is a cooperative store, some of them
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
actually became a member of the cooperativespecially people from of Kibungan, Buguias
and Kabayan.
As Jurado (1982) stated, marketing strategy is an overall program based upon selecting a
particular target of the market on what a customer needs and wants.
Product uniqueness in the market. The result shows that three (60%) of the
respondents says that both utility of the product and product innovation effectiveness are
what made their product unique in the market/customers. Also twenty percent of the
respondents say that product labeling and packaging are what make their product unique.
As one (20%) of the respondent said, what makes their product unique in the
market/customers is that no other products looks like it for they are the only ones producing
that kind of flowers (Carnation) and it is only in their place that this kind of flower can
grow because of their climate and also having the characteristics of being showy, colorful
(complete color like pink, blue, white, red) and long lasting flowers that has become one
of the favorite cut flowers which is excellent for floral bouquet.
Furthermore, their product is unique for having good quality a prolong life span or
shelf life for each member have their own greenhouse where they plant and secure the
quality of the flowers. After harvest, the flowers are conditioned immediately after storage
to counteract slight dehydration during storage and it is done either re-cutting the stem by
about 2-4 cm or by placing in the preservative or warm water of 38-40 degree Celsius for
at least two hours before arranging in a vase or delivering.
One (20%) of the respondents whose product is rice wine stated that the taste of the
wine is just exact, no alcohol and water added and for two (40%) of the respondentssaid
that what makes their CJDRA wine and mukosako unique is that they are the only ones
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
producing that kind of wine and no other products looks like it. And for the potato chips of
one (20%) of the respondent, it has different flavors like cheese and spicy from different
varieties of potato such as granula, raniag and LBR; different sizes like jumbo, super XL
and extra used in the production of potato chips.
According to Elbert and Greffin (2000), one must have a product differentiation that would
make a certain product unique in the market and would promote particular features of the
products in order to distinguish them on the market place. Product differentiation is the
creation of the feature or image that makes a product differ enough from existing product
to attract customers.
Value of the product to customers. The table shows that all (100%) of the respondents’
products provide value to customers and that is customer satisfaction; 60% of the
respondents said reliability; durability and tangibility and helps lessen or make work easier
is the value of their product provided to customers.
One of the respondent stated that other value their product provide to customers is that
having a long shelf life, as Mr. Celo added, their product cannot easily be withered and
destroyed (“mabayag nga mausar, mapakinabangan”). It has variety of colors that
customers can select and also used to make ceremonial crowns and coronations were
decorative head bands made of woven flowers worn by young maidens.
As G0 (1997) imposed, efficiency and effectiveness of a cooperative is not
measured by the amount of profit it makes during a time but on how satisfied the members
and customers are with the service/product rendered.
Problems and concerns that are addressed by the cooperatives’ product and service.
The result shows the multiple responses of the respondents on what are the problems that
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
were addressed by the product. As Go (1997) stated that the product function is to provide
benefits desired by the target market/customers. Majority (80%) of the respondent stated
that farming problems such as crop/plant diseases that according to TMPC they have the
“Mukosako” which is an organic foliar spray from burned ashes and used to control blight
of potatoes; 60% on household problems and 40 % are on sense of belongingness, hunger,
thirst, discomfort and self-image enhancement or affective fulfillment.
Table 4. Product strategies
PARTICULARS
FREQUENCY PERCENTAGE
Target Markets/Customers
Students
5
100%
Professionals
5
100%
Farmers
5
100%
Tourist
3
60%
Passers-by
3
60%
*Multiple response
Product Uniqueness in the Market
Product class dissociation
1
20%
Utility of the product
3
60%
Labeling and packaging
1
20%
Product innovation effectiveness
3
60%
*Multiple response
Table 4. Continued. . .
PARTICULARS
FREQUENCY PERCENTAGE
Value of the Product to Customers
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Reliability
3
60%
Durability and tangibility
3
60%
Meet customers’ needs and wants
5
100%
Helps lessen or make work easier
3
60%
*Multiple response
Customers’ problems that help solved by the product
Sense of belongingness
Hunger, thirst, discomfort
2
40%
Self-image enhancement(affective fulfillment)
2
40%
Farming problems
2
40%
Household problems
4
80%
3
60%
*Multiple response
B. Pricing Strategies
Table 5 presents the pricing strategies of the Cooperatives on how they price their product,
what are their main objective in pricing, what discounts they offer to customers, customers’
price sensitivity and cooperatives’ pricing. As Go (1997) revealed that the price function
is to make the product affordable to target market and reflect the value of benefits provided.
Customers and competition must be considered in setting the prices. Tactics in prices
include variation, discounts, psychological pricing and price lining.Other decisions on
pricing include different ways of pricing, discounts and credits.
Price of the product. The result shows that all (100%) of the respondents price their
product based on production cost plus percentage mark-up.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Main Objective in pricing. All (100%0 of the respondents had the objective to satisfy
customers in pricing their product. And one of the respondents had the objective of greater
return to investment. Majaro, (1993) stated that pricing is a crucial element of marketing
mix because profit implication affects the long term success of any enterprise.
Discounts offer to customers. Twenty percent of the respondents offer bulk
discounting and member discount to customers. Specifically, MBMPC give or offers give-
aways like extra bundles or stems of flowers as their discounts to whoever will buy their
product and sometimes give their customers the privileges to choose and pick the flowers
they wanted right at the green houses. Also for the Mukosako, discount offered is extra
liters or ml of mukosako like 150ml and for the rice wine, potato chips and CJDRA wine
have only member discount.
Customers price sensitivity. All (100%) of the respondents said that with a small decrease
in price it does not gain extra market share wherein if the cooperative lower their price it
results to low profit and with a small increase in price gain extra profitwherein if
cooperative price their product higher it results to higher profit.As the saying of Raymond
Corey stated, the art of pricing is to have the price be an equate to the value of the product
to the customers –anything less than that represents a sacrifice in potential profits.
Cooperative pricing. Two (40%) of the respondents price their products same with
competitors and 20% of the respondents price their product with the demand of the product,
psychological pricing and based on production cost plus percentage mark-up.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 5. Pricing strategies
PARTICULARS
FREQUENCY PERCENTAGE
Price of the Product
Based on production cost plus
percentage mark-up
5
100%
TOTAL
5
100%
Main objective in pricing
Satisfy customers
4
80%
Greater return to investment
1
20%
TOTAL
5
100%
Discounts offer to customers
Bulk discounting
1
20%
Member discount
5
100%
*Multiple response
Customers’ price sensitivity
Small decrease in price doesn’t gain extra
5
100%
market share
Small increase in price gain profit margin
5
100%
*Multiple response
Cooperative’s pricing
Psychological pricing
1
20%
Demand of the product
1
20%
Same with competitors
2
40%
Production cost plus percentage mar-up
1
20%
TOTAL
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
C. Place and Distribution Strategies
Table 6 presents the place and distribution strategies of the Cooperatives that included
where the cooperative is located, why did they choose that location, having that location
who are their target markets, channels of distribution and access to right distribution
channel.
Location of the cooperative. The table shows that majority (60%) of the respondent are
located near the highway and 40% are away from the highway and market area.
Reasons in choosing the location. Almost all (80%) of the respondents chose the location
for its accessibility and 40% choose the location for its safety and customers traffic. While
20% of the respondents specifically ACMPC do not have a choice because there are no
more suitable locations.
Target market. The table shows that all (100%) of the respondents targeted students,
employees and farmers and 60% targets the passers-by.
Channels of distribution. All (100%) of the respondents used direct customers and retailers
as their distribution channels and only 20% uses wholesalers as their channel of
distribution. Hutt and Stull, (1992) said thatthe business has to decide on a channel of
distribution which may be described as a system of people and organization that get product
or service from the producer to the customer. Distribution decisions include deciding on
whether to use a direct or an indirect distribution channel and where the business is to be
located.
Access to right distribution channels. The result showed that all (100%) of the respondents
access the right distribution channels through delivery and pick up and only 20% of the
respondents is through trucking.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 6. Place strategies
PARTICULARS
FREQUENCY PERCENTAGE
Location of the Cooperative
Near the highway
3
60%
Market area
2
40%
Away from the highway
2
40%
*Multiple response
Reasons in Choosing the Location
Accessible
4
80%
Many customers
2
40%
Safer
2
40%
No choice
1
20%
*Multiple response
Target Market
Farmers
5
100%
Employees
5
100%
Students
5
100%
Passers-by
3
60%
*Multiple response
Table 6. Continued. . .
PARTICULARS
FREQUENCY PERCENTAGE
Channels of Distribution
Direct customers
5
100%
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Retailers
5
100%
Wholesalers
1
20%
*Multiple response
Access to Right Distribution Channels
Delivery
5
100%
Pick up
5
100%
Trucking’s
1
20%
*Multiple response
D. Promotion Strategies
Table 7 presents the promotional strategies of the Cooperatives on the method and ways in
promoting their product, where and when to get across the marketing message to target
market and how does it influence the cooperative choice of promotional activities. As
stated by Rue and Holland (1986), promotional strategy is like a general overall battle plan,
it tells a broad term how a firm will see promotion to secure an advantage over the
competition to attract buyers and capitalize on its resources. A firm’s objective indicates
where it wants to go, and its strategy describes how it will get there and how it will
accomplish its objectives. The most important promotional tools includes advertising,
personal selling, sales promotions and public relations.
Methods of promoting the product. Majority (80%) of the respondents uses
personal selling in promoting their product; 40% uses sales promotion and 20% of the
respondents uses advertising in promoting their product. The result shows that under
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
advertising, only one (20%) of the respondents specifically MBMPC uses fliers, radio and
tarpaulin in advertising their product to attract customers. Other ways is through give-
aways or gifts like for TMPC, they do not have promotional strategies but they considered
giving Cooperative printed t-shirts, umbrella, hat and bags as ways or methods to attract
their customers.
On the other hand, under sales promotion all (100%) of the respondents uses plain product
display. Under getting across the market message to target markets were multiple responses
from the respondents. All (100%) of the respondents get their market message to target
markets during occasions like weddings and birthdays wherein the flowers are needed for
bouquet and floral arrangement also wines for the celebrations; 80% says during festivals
like parades and 60% says during holidays where many students are spending their holidays
in their places and market area on peak seasons.
Influences on the cooperatives’ choice of promotional activity. The result shows that all
(100%) the respondents were influenced by their target market to innovate and develop
their products and services.
As Go (1997) stated, when a product reaches its maturity or even in the marketing message,
the product must gain a new life cycle or continuous product innovation and product
development by adding better feature or giving it a new image of the product.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 7. Promotion Strategies
PARTICULARS
FREQUENCY PERCENTAGE
Ways of promoting the product
Advertising
Radio
1
20%
Tarpaulins
5
100%
*Multiple response
Sales promotion
Plain product display
5
100%
Give aways
2
40%
*Multiple response
Getting across the marketing message
Market area on peak season
3
60%
Occasions
5
100%
Festivals
4
80%
Holidays
3
60%
*Multiple response
How does it influence the coop
Innovation and development
5
100%
TOTAL
5
100%
Successful and Sustainable Marketing Strategies
Table 8 presents that all (100%) of the respondents stated that trainings and
seminars were the strategies which are successful and sustainable to their Cooperatives. As
the managers and chairman of each cooperatives stated, attending trainings and
seminars/programs enhancetheir knowledge on cooperatives that would help them became
more active in the cooperative. Further, Four (80%) of the respondents said that effective
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
and efficient service offered by the cooperative and having focused on common goods and
wants of target markets are also one of the cooperatives marketing strategies.
Also,
two (40%) of the respondents said that one of their strategies is that offering product having
its own/patent brand that attracts customers to buy. As Go (1997) said, product
innovation/development may mean repositioning the product by adding better features,
giving it a new image or own/patent brand for packaging is an important factors in
projecting the product image.
Moreover, 20% of the respondent stated that consistent supply or having the
comparative advantage is what made their cooperative successful and sustainable because
of the consistent supply of the product. For TMPC one strategy that sustains their
cooperative is the lending and social services (“Ammoyong” Death aid) a kind of mutual
fund given in case of death of one person and with this many became a members of the
cooperatives.
Table 8. Successful and Sustainable Marketing Strategies
PARTICULARS
FREQUENCY PERCENTAGE
Products offered have its own
patent/brand that attracts customers to buy
2
40%
Focus is on common goods and wants
4
80%
Trainings and seminars/programs
5
100%
Effective and efficient service offered
4
80%
Consistent supply(comparative advantage)
1
40%
Ammoyong Association and lending services
1
40%
*Multiple Responses
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Problems Encountered in Adopting such Strategies
Table 9 presents the problems encountered by the respondents in adopting such
strategies.
Product strategies. In terms of product strategies, all (100%) of the respondents
encountered lack of raw materials to be used and 40% of the respondents stated limited
production and finance. Funds are not enough to be used in the making or developing of
products. According to one (20%) of respondent, they do not have unique image of their
product for they lack raw materials to be used specially on packaging and labeling as well.
The bottles used for their Mukosako is the coco-cola plastic having no label and as to their
wine it was bottled in an emperador or blue gin bottle.
Furthermore, one (20%)of the respondent admitted that financial support is not enough to
sustain their product, to buy planting materials specially the seedlings which are to be
imported from China, South Korea and Poland and that they do not have the capability or
enough financial support to import seedlings. As a result the respondents just propagate or
generate new seedlings from the past planting but no longer the same quality as time passes.
Price strategies. Majority (60%) of the respondents encountered the problem buyers
preferential differences- wherein some customers are value oriented (want to pay low
prices for acceptable quality) and others want high quality and are willing to pay anything
to get it. Also, 40% of the respondents stated that they pricedtoo low that result to low
profit and 20% of the respondent saidthat price is too high that customers can’t afford it
and price of one of their product can impact sales of other products. One (20%) of the
respondent stated that one of their problems that affect their pricing is the orientation of
customers on the price of one product to be stable/steady all throughout and without
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
considering the quality and demand of the product which is changing and that customers
just say that the price is always the same/alike.
Place and distribution strategies. Majority (80%) of the respondents encountered
limited channels of distribution. Twenty percent of the respondents have a problem on the
distance of production and market site that it takes many hours or days before it reaches
the customers and by that there are tendencies for the product to be damaged during the
transportation.
Promotion strategies. All (100%) of the respondents stated that they have limited
knowledge on promotional strategies. Twenty percent of the respondents do not have
enough resources to be used for the promotional strategies of their product.
Table 9. Problems encountered
PARTICULARS
FREQUENCY PERCENTAGE
Product strategy
Limited production cost
2
40%
Lack of raw materials to be used
5
100%
Financial support is not enough
2
40%
*Multiple response
Price strategy
Price is too high that customers cannot
1
20%
afford to buy it
Price is too low that result to low profit
2
40%
Price of one product can impact sales of
1
20%
other products
Buyers preferential differences
3
60%
*Multiple response
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
Table 9. Continued. . .
PARTICULARS
FREQUENCY PERCENTAGE
Place strategy
Limited channel of distribution
4
80%
Far distribution channels
1
20%
TOTAL
Promotion strategy
Not enough resources
1
20%
Limited knowledge on promotional
5
100%
strategies
Product development
1
20%
*Multiple response
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary
This study was conducted in the five selected cooperatives in Atok, Benguet. It was
conducted to determine the businesses of cooperatives; to identify the marketing strategies
of cooperatives in terms of product, price, place and promotion; to determine the
cooperatives’ marketing strategies which are successful and sustainable and to identify
problems encountered by each cooperative in adopting such strategies
Five management staff and officers (2 chairman and 3 managers) were the key
respondents of the study. A structured questionnaire was employed and personal interview
using the guide questionnaires to gather the needed information and data that were
tabulated analyzed and interpreted using tables and descriptive method like frequency and
percentage analysis.
The results revealed that though some of the cooperatives are registered as multi-
purpose it operates as a consumer type. They offered goods/services which are more on
farm supplies like pesticides, fertilizers; credit and financing (consumers’ goods,
appliances); and marketing (member products, coop products).
The finding showed that the marketing strategies adopted and being used by the
respondents. In terms of product strategies, the respondents have the same target markets,
farmers, professionals, students, and some tourist and passers-by. Their product value is to
meet customers’ needs and wants or customer satisfaction. Likewise in some ways or in
some points to help lessen/make work easier specifically farming problems and household
problems. As to the problems encountered in their product strategies, all the respondents
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
answered lack of raw materials and funds. They lack funds to improve and develop their
product.
Also, in terms of pricing strategies, all the respondents priced their product based
on production cost plus percentage mark-up having the main objective to satisfy customers.
For one (20%) of the respondentsis for greater return to investment. As to the strategies in
pricing their product, they compare with other cooperative or to competitors. Two (40%)
of respondents price their product same with their competitors, one (20%) respondent is
through psychological pricing and one (20%) based on the demand of the product and 20
% based on production cost plus percentage mark-up. With regards to the problems
encountered in the pricing strategies, majority stated that it is buyers preferential
differences where in most of their customers are value oriented (want to pay low prices for
acceptable quality) and others want high quality and are willing to pay anything to get it.
Furthermore, in terms of place and distribution strategies, the finding showed that
majority are located near the highway where it is more accessible and where the customers’
traffic. As to the channels of distribution and right accessibility of distribution channels of
the cooperatives, all respondents used direct customers and retailers and access through
delivery and pick up. Only one (20%) of the respondent used wholesalers and access
distribution channels through trucking aside from the strategy mentioned above. For the
problems encountered by the respondents in the distribution, majority (80%) said they have
limited channels of distribution and one (20%) of the respondent said their problem is far
distance of production and market site.
The results shows that in terms of promotional strategies, all (100%) of the
respondents promote their product through sales promotion which are plain product display
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
and some give aways like printed bags, t-shirt and hat. Under advertising only one (20%)
of the respondent uses radio, tarpaulins in promoting their productsand majority get the
marketing message on occasions, festivals that influence the respondents to the innovation
and development of their product. As to the problems encountered in promotional strategies
all the respondents admitted that besides for not having enough resources, they also have
limited knowledge on promotional strategies.
Successful and sustainable marketing strategies there are: trainings and
seminars/programs, effective and efficient service offered by the cooperatives,
cooperatives focused on common goods and wants; products offered by the cooperative
have its own/patent that attracts customers to buy. In addition, consistent supply of the
product (comparative advantage), social services (Ammoyong Death Aid) and lending
services are what sustain the success of the respondents.
Conclusions
Based on the findings of this study, the followings were drawn:
1. Majority of the cooperatives, though registered as multi-purpose but operates
consumer type and that each cooperative have its own product and services offered to the
customers which are more on financing (consumer’s goods, common goods) , marketing
(coop product, member product), farm supplies, credit (provident loans);
2. In terms of pricing strategies, all the cooperatives price their product based on
production cost plus percentage mark-up, having the main objective of satisfying
customers and offering member and bulk discounting to attracts customers;
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
3. With regards to place strategies, majority of the cooperative are located near the
highway where it is more accessible to target markets, to channels of distribution and
having the right distribution channels through delivery pick up and trucking;
4. The cooperatives uses sales promotion which are plain product display and some
give-ways in promoting their product and most of the cooperative get the marketing
message during occasions and festivals like wedding, birthdays and parade during festivals
wherein flowers are needed for floral arrangement and bouquet and wine for the celebration
that influence them to innovate and develop their product;
5. Cooperatives’ marketing strategies which are successful and sustainable are
trainings and seminars/programs; effective and efficient service offered by the cooperative
importantly the employees/staffs; focus of the cooperative is on common goods and wants;
products offered have its own/patent brand that attracts customer to buy and for some is
the consistent supply (comparative advantage) offered by the cooperative and social service
(Ammoyong, death aid), lending services that help sustain the cooperative; and,
6. Problems encountered by the cooperatives are lack of raw materials to be used in
terms of product strategies; buyers’ preferential differences and price is too low that result
to low profit for pricing strategies; limited and far distribution channels for place strategies
and lack of knowledge on promotional strategies.
Recommendations
Based on the results of the study the following were recommended:
1. Cooperatives must continue in innovating and developing their productfor the
benefit of the members;
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
2. Cooperatives should seek the assistance of the union or federation for some
financial support or assistance;
3. Cooperatives should set a price that complements the product, place, and promotion
and must be aware of the customers’ perceived value for the product;
4. The cooperatives must have pricing efficiency which is concerned with improving
the operation of the buying, selling and pricing in order to remain responsive to consumers’
needs and wants;
5. The cooperatives should look for alternative market outlets for the products
specially the cut flowers, mukosako so that farmers could increase the volume of their
production; and,
6. The cooperatives to tap and avail technical assistance by way of trainings and
seminars regarding marketing strategies; product, price, place and especially promotion
strategies and have continuous cooperative education and trainings to motivate members
to patronize the cooperative.
Marketing Strategies of Selected Cooperatives in Atok, Benguet
TOYAO, JOANA A. APRIL 2013
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