Analysing retailers' buying behaviour and loyalty of branded adible groundnuts in the North West Province and Gauteng

Abstract

South Africa is an exporter of groundnuts (Arachis Hypogaea). The domestic market reaps the spinoff advantage that export quality reaches store shelves, but unfortunately at a price that is directly linked to the price traders achieve on the export market. The local edible groundnut demand is relatively stable, but some processors saw a dramatic decline in the demand for groundnuts within the fast moving consumer goods (FMCG) industry. Businesses in the groundnut industry have a specific objective to create a turnaround strategy for groundnut production in South Africa, in an attempt to increase exports of locally produced groundnuts. This directly results that importance of the domestic market, compared to the export market is secondary. Since retail buyers are the “gatekeepers of consumer choice”, it is important to understand buying behaviour and brand loyalty, as well as the factors that influence buyers’ decisions in a business to business context. Limited literature exists for the domestic South African that highlights or indicates specific buyer preferences towards branded edible groundnuts. Furthermore, a general conceptual model to measure or to provide insight on retailer buyer preferences and buying behaviour lack, or are generally unrelated. An adapted model was used to analyse retail buyer behaviour, perceptions, and brand loyalty influences and data was collected by means of a self administrered questionnaire. Descriptive statistics as well as factor analysis were utilised to identify which factors influence retail buyers’ purchase behaviour and loyalty towards an edible groundnut brand. The Kaiser-Meyer-Olkin measure of sampling adequacy, Bartlett’s test of sphericity and Cronbach Alpha was used to determine whether the collected data was appropriate for factor analysis. Through the factor analysis the following ten factors were identified as having a significant influence on retailers’ buying behaviour as well as brand loyalty towards branded edible groundnuts: * Long-term relationship with a preferred brand. * Brand Loyalty. * Brand trust. * Brand performance. * Satisfaction. * Intentional repurchase. * Brand affect. * Company reputation. * Involvement. * Value for money. More research on this topic is required to develop a single conceptual model in order to measure and analyse retail buyer behaviour and preference for a specific brand on a larger scale within the FMCG industry.