Effects of 4Ps Marketing Mix Strategies on Profitability Enhancement of Petroleum Companies in Afghanistan – A Case Study

Year 2024, Issue: 96, 32 - 58, 24.06.2024

Mir Abdullatif Yahya

https://doi.org/10.26650/imj.2024.96.1372899

Abstract

In the current era of intense rivalry, organizations must develop effective marketing strategies to differentiate themselves and raise awareness about their products or services. The effective execution of optimal marketing mix strategies possesses the capability to augment brand equity as well as establish a formidable competitive position. Unfortunately, the implications of 4Ps marketing mix strategies on the profitability of petroleum businesses (especially automotive fuels and autogas, or LPG) in Afghanistan have received little attention and have not been adequately investigated. The current study sought to determine the effectiveness of 4Ps marketing mix strategies and their relationship to increasing the petroleum company’s profitability in Afghanistan. A case study approach was used to evaluate the marketing mix strategies applied by Zhakfar Petroleum, operated by the company Zhakfar Logistics and Services Ltd. Primary and secondary data was collected via personal interviews with the CEO, branch managers, finance managers, and the website of the company. Content analysis was used to evaluate the data obtained from both the survey and the sales data of the company. The research suggested that the company employed various marketing strategies related to “Product”, “Price”, “Place”, and “Promotion”, which demonstrated a significant growth rate of 34.51% during three months of marketing campaigns.

JEL Classification : M1

Keywords

Marketing mix strategies, fuel industry, competitive advantage, sales performance, Afghanistan

References

• Aghara, V. N., Nwaizugbo, I. C., Oparah, P. C., & Ifeanyichukwu, C. D. (2018). Sales promotion as a leverage strategy for improving sales and profitability in alcohol beverage industry. International research journal of management, IT and social sciences, 5(4), 18-25. google scholar
• Ardley, B. (2005). Marketing managers and their life world: explorations in strategic planning using the phenomenological interview. The Marketing Review, 5, 111-127. https://doi.org/10.1362/1469347054426195. google scholar
• Arif, A. A. (2022). The Impact of the Marketing Mix on Online Business: A Study in Sylhet City. South Asian Res J Bus Manag, 4(6), 220-225. google scholar
• Armstrong, G., Adam, S., Denize, S., & Kotler, P. (2014). Principles of marketing. Pearson Australia. google scholar
• Bahadir, S. C., Bharadwaj, S. G., & Srivastava, R. K. (2015). Marketing mix and brand sales in global markets: Examining the contingent role of country-market characteristics. Journal of International Business Studies, 46, 596-619. google scholar
• Bandinelli, R., & Gamberi, V. (2011). Servitization in oil and gas sector: outcomes of a case study research. Journal of Manufacturing Technology Management, 23(1), 87-102. google scholar
• Banerjee, S., & Bhardwaj, P. (2019). Aligning marketing and sales in multi-channel marketing: Compensation design for online lead generation and offline sales conversion. Journal of Business Research, 105, 293-305. google scholar
• Bengtsson, M. (2016). How to plan and perform a qualitative study using content analysis. NursingPlus open, 2, 8-14. google scholar
• Bennett, P.D. 1995. Dictionary of marketing terms. 2nd edition. Chicago: American Marketing Association, p. 115. google scholar
• Benson, A., & Rissing, B. A. (2020). Strength from within: Internal mobility and the retention of high performers. Organization Science, 31(6), 1475-1496. google scholar
• Bitner, M. J. (1992). Servicescapes: The impact of physical surroundings on customers and employees. Journal of marketing, 56(2), 57-71. google scholar
• Booms and Bitner (1981). Marketing strategies and organizational structures for service firms. Marketing of services, Marketing of Services 1981, American Marketing Association. google scholar
• Borden, N. H. (1965). The concept of the marketing mix. In Schwartz, G. (Ed), Science in marketing. New York: John Wiley & Sons, 386-397. google scholar
• Campbell, D., Stonehouse, G., & Houston, B. (2002). Business strategy: an introduction. Routledge. google scholar
• Candemir, A., Ventura, K., & Kazançoğlu, İ. (2011). Content Analysis Of Top 1000 Turkish Company Web Sites: Marketing Mix Practices. International Journal of Business and Management Studies, 3(2), 55-68. google scholar
• Central Intelligence Agency. (2021). The World Factbook: Afghanistan. Access time: 17 May 2023, Retrieved from https://www.cia.gov/the-world-factbook/countries/afghanistan/ google scholar
• Check, J., & Schutt, R. K. (2011). Research methods in education. Sage Publications. google scholar
• Christensen, C., & Raynor, M. (2013). The innovator’s solution: Creating and sustaining successful growth. Harvard Business Review Press. google scholar
• Cooper, D. R., Schindler, P. S., Cooper, D. R., & Schindler, P. S. (2006). Marketing research. New York: McGraw-Hill/Irwin. google scholar
• Cronje, GJ, Du Toit GS, Motlatla, & MDC, Marais, A de K. 2007. Introduction to Buiness Management. 6th edition.Cape Town: Oxford University Press, p. 283. google scholar
• Culliton, J.W. (1948). The Management of Marketing Costs. Division of Research, Graduate, School of Business Administration, Boston, MA: Harvard University. google scholar
• Damirchi, G. V., & Shafai, J. (2011). A guideline to Islamic marketing mix. Interdisciplinary Journal of Contemporary Research in Business, 3(3), 1339-1347. google scholar
• Dworkin, S. L. (2012). Sample size policy for qualitative studies using in-depth interviews. Archives of sexual behavior, 41, 1319-1320. google scholar
• Edgar, T. W., & Manz, D. O. (2017). Convenience sampling. Research Methods for Cyber Security. google scholar
• Freiling, J. (2004). A Competence-based Theory of the Firm. management revue, 27-52. google scholar
• Gora, Rahila Chirai & Mohammed, Zakari & Habibu, Mohammed & Aliyu, Murtala. (2020). Influence of Marketing Strategies on Sale Of Periodical Publications By The Periodical Street Vendors In Zaria Metropolis, Kaduna State, Nigeria. google scholar
• Gronroos, C. (1994). From marketing mix to relationship marketing: towards a paradigm shift in marketing. Asia-Australia Marketing Journal, 2(1), 9-29. google scholar
• Guenzi, P., Sajtos, L., & Troilo, G. (2016). The dual mechanism of sales capabilities in influencing organizational performance. Journal of Business Research, 69(9), 3707-3713. google scholar
• Habibi, M., Kheiri, B., & Aligholi, M. (2023). Developing an Integrated Marketing Mix Based on the Behavior of Industrial Customer: The Case of Behran Oil Company. Iranian Journal of Management Studies, 16(2), 465-479. google scholar
• Hanaysha, J. R., Al Shaikh, M. E., & Alzoubi, H. M. (2021). Importance of marketing mix elements in determining consumer purchase decision in the retail market. International Journal of Service Science, Management, Engineering, and Technology (IJSSMET), 12(6), 56-72. google scholar
• Hindi, A. M., Schafheutle, E. I., & Jacobs, S. (2019). Community pharmacy integration within the primary care pathway for people with long-term conditions: a focus group study of patients’, pharmacists’ and GPs’ experiences and expectations. BMC family practice, 20(1), 1-15. google scholar
• Hourneaux Jr, F., Gabriel, M. L. D. S., & Gallardo-Vazquez, D. A. (2018). Triple bottom line and sustainable performance measurement in industrial companies. Revistade Gestâo, 25(4), 413-429. google scholar
• Ingram, T. N., LaForge, R. W., Avila, R. A., Schwepker Jr, C. H., & Williams, M. R. (2015). Sales management: Analysis and decision making. Routledge. google scholar
• Isoraite, M. (2016). Marketing mix theoretical aspects. International Journal of Research-Granthaalayah, 4(6), 25-37. google scholar
• Jain, S. C., & Punj, G. (2002). Developing marketing Practices: A framework Approach. Marketing Intelligence and Planning, 7(3), 34-42. google scholar
• Jaworski, B. J., & Kohli, A. K. (1993). Market orientation: antecedents and consequences. Journal of marketing, 57(3), 53-70. google scholar
• Johnston, W. J., Leach, M. P., & Liu, A. H. (2001). Using case studies for theory testing in business-to-business research: the development of a more rigorous case study methodology. In Getting better at sensemaking (pp. 215-241). Emerald Group Publishing Limited. google scholar
• Kanten, I. K., & Darma, G. S. (2017). Consumer behaviour, marketing strategy, customer satisfaction, and business performance. Jurnal Manajemen Bisnis, 14(2), 143-165. google scholar
• Keramati, A., Ardalan, A., & Ashtiani, P. G. (2012). Relationship between marketing mix and sales performance In the context of the Iranian Steel private firms. International Journal of Arts and Commerce, 1(6), 195-199. google scholar
• Khalazaie M (2019) “Developments in the oil and gas sector of Afghanistan” Kakar Advocates Law Firm LLC (https://kakaradvocates.com) Accessed: 25 May 2023. google scholar
• Khan, S., Steenkamp, P., & Haydam, N. (2012). Marketing mix strategy adaptation: a retail organization’s response to the global economic downturn. Journal of Applied Research in Business and Economics. google scholar
• Kotler, P., & Armstrong, G. M. (2010). Principles of marketing. Pearson Education India. google scholar
• Kotler, P., & Keller, K. (2003). Marketing management, (international version). google scholar
• Kozlenkova, I. V., Samaha, S. A., & Palmatier, R. W. (2014). Resource-based theory in marketing. Journal of the academy of marketing science, 42, 1-21. google scholar
• Lamb, C. W., Hair, J. F., & McDaniel, C. (2011). Essentials of marketing. Cengage Learning. google scholar
• Le Meunier-FitzHugh, K., & Lane, N. (2009). Collaboration between sales and marketing, market orientation and business performance in business-to-business organisations. Journal of Strategic Marketing, 17(3-4), 291-306. google scholar
• Londhe, B. R. (2014). Marketing mix for next generation marketing. Procedia Economics and Finance, 11, 335-340. google scholar
• Louis W. Stern and Adel I. EI-Ansary, Marketing Channels, 3rd ed. (Englewood Cliffs, NJ: Prentice-Hall, 1988). google scholar
• Lovelock, C. H., & Yip, G. S. (1996). Developing global strategies for service businesses. California management review, 38(2), 64-86. google scholar
• McCarthy, J. (1964). The concept of the marketing mix. Journal of Advertising Research, June, 2-7. google scholar
• McGrath, M. (2000). Product strategy for high technology companies. McGraw Hill Professional. google scholar
• Mihalcea, A. D. (2015). HUMAN RESOURCES AND MARKETING MIX IN OIL & GAS INDUSTRY. Annales Universitatis Apulensis-Series Oeconomica, 17(1). google scholar
• Möller, K. (2006). The marketing mix revisited: Towards the 21st century marketing by E. Constantinides. google scholar
• Morimura, F., & Sakagawa, Y. (2018). Information technology use in retail chains: Impact on the standardisation of pricing and promotion strategies and performance. Journal of Retailing and Consumer Services, 45, 81-91. google scholar
• Nagle, T. T., & Holden, R. K. (1995). The strategy and tactics of pricing Englewood Cliffs. NJ: Prentice Hall. Naman, JL and DP Slevin (1993)," Entrepreneurship and the Concept of Fit: A Model and Empirical Tests," Strategic Management Journal, 14, 137-54. google scholar
• Neri, A., Cagno, E., Lepri, M., & Trianni, A. (2021). A triple bottom line balanced set of key performance indicators to measure the sustainability performance of industrial supply chains. Sustainable Production and Consumption, 26, 648-691. google scholar
• Neubauer, B. E., Witkop, C. T., & Varpio, L. (2019). How phenomenology can help us learn from the experiences of others. Perspectives on medical education, 8, 90-97. google scholar
• Niazi, N., Rashid, M., & Shamugia, Z. (2021). Role of Marketing Mix (4Ps) in Building Brand Equity: Case Study of Shell Petrol, UK. International Journal of Applied Business and Management Studies, 6(1), 2021. google scholar
• Pajhwok Afghan News. (2020, October 26). Afghanistan’s Petroleum Potential and Investment Opportunities. Access time: 17 May 2023, Retrieved from https://www.pajhwok.com/en/2020/10/26/afghanistan%E2%80%99s-petroleum-potential-and-investment-opportunities google scholar
• Palmatier, R. W., & Crecelius, A. T. (2019). The “first principles” of marketing strategy. Ams Review, 9, 5-26. google scholar
• Parment, A., Kotler, P., & Armstrong, G. (2021). Principles of Marketing: Scandinavian Edition. Pearson Higher Ed. google scholar
• Paterson, A. (2005). Understanding Markets in Afghanistan: A Study of the Market for Petroleum Fuels (No. 298-2016-4739). google scholar
• Pitt, L., Berthon, P., & Berthon, J. P. (1999). Changing channels: the impact of the Internet on distribution strategy. Business Horizons, 42(2), 19-28. google scholar
• Porter, M. E. (2011). Competitive advantage of nations: creating and sustaining superior performance. simon and schuster. google scholar
• Prasnikar, J., Lisjak, M., Buhovac, A. R., & Stembergar, M. (2008). Identifying and exploiting the inter relationships between technological and marketing capabilities. Long Range Planning, 41(5), 530-554. google scholar
• Prescott, J. F., & Miller, S. H. (Eds.). (2002). Proven strategies in competitive intelligence: lessons from the trenches. John Wiley & Sons. google scholar
• Rahman, M., Islam, M., Al Amin, M., Sultana, R., & Talukder, M. (2019). Effective factors of service marketing mix on tourist satisfaction: A case study. Asian Social Science, 15(7). google scholar
• Rahmaty, H., Ershad, A. M., & Sabory, N. R. (2020). Afghanistan fuel market prediction. Repa Proceeding Series, 1-12. google scholar
• Rouzies, D., & Hulland, J. (2014). Does marketing and sales integration always pay off? Evidence from a social capital perspective. Journal of the Academy of Marketing Science, 42, 511-527. google scholar
• SAM, A. F. (2017). The Effects of Marketing Mix (4P) on Companies’ Profitability: A Case Study of Automotive Industry in France. Journal of Research in Marketing (ISSN: 2292-9355), 8(1), 636-640. google scholar
• Sanchez, R., & Heene, A. (2004). The new strategic management: Organization, competition and competence. Wiley. google scholar
• Schulz, S. A., & Flanigan, R. L. (2016). Developing competitive advantage using the triple bottom line: A conceptual framework. Journal of Business & Industrial Marketing. google scholar
• Singh, M. (2012). Marketing mix of 4P’s for competitive advantage. IOSR Journal of Business and Management, 3(6), 40-45. google scholar
• Srisorn, W., Chayanon, S., & Punluekdej, T. (2019). Marketing Mix Affecting Buying Behavior of Riceberry of the Consumers in Yasothon Province. BESM-30, 14. google scholar Sugianto, S. (2022). Behind the Selling Price Determination in Commercial Photography Service Practice. Indonesian Interdisciplinary Journal of Sharia Economics (IIJSE), 5(1), 331-341. google scholar
• Terho, H., Eggert, A., Haas, A., & Ulaga, W. (2015). How sales strategy translates into performance: The role of salesperson customer orientation and value-based selling. Industrial marketing management, 45, 12-21. google scholar
• Thanabordeekij, P., & Syers, K. (2020). The effect of marketing mix factors and brand image toward customer satisfaction and customer loyalty of liquefied petroleum gas for household use in Thailand. Journal of ASEAN PLUS Studies, 1(1), 35-43. google scholar
• Theodore Levitt (1965), Exploit the Product Life Cycle; to convert a tantalizing concept into a managerial instrument of competitive power, Product Management, Harvard Business Review. Access time: 23 May 2023, 11:01 AM, Retrieved from: https://hbr.org/1965/11/exploit-the-product-life-cycle. google scholar
• Turner, G. B., & Spencer, B. (1997). Understanding the marketing concept as organizational culture. European Journal of marketing. google scholar
• Ulmishek, G. F. (2004). Petroleum geology and resources of the Amu-Darya basin, Turkmenistan, Uzbekistan, Afghanistan, and Iran (Vol. 2201). Iran: US Department of the Interior, US Geological Survey. google scholar
• Varadarajan, R., & Yadav, M. S. (2009). Marketing strategy in an internet-enabled environment: a retrospective on the first ten years of JIM and a prospective on the next ten years. Journal of interactive marketing, 23(1), 11-22. google scholar
• Whetton, D. (2011). Organizational Effectiveness: A Comparison of Multiple Models (pp. 261-77). New York, NY: Academic Press. google scholar
• Yasanallah, P., & Bidram, V. (2012). Studying the status of marketing mix (7Ps) in consumer cooperatives at IIam province from members’ perspectives. American Journal of Industrial and Business Management, 2(04), 194. google scholar
• Yoo, B., Donthu, N., & Lee, S. (2000). An examination of selected marketing mix elements and brand equity. Journal of the academy of marketing science, 28(2), 195-211. google scholar
• Zahra, S. A., & Covin, J. G. (1995). Contextual influences on the corporate entrepreneurship-performance relationship: A longitudinal analysis. Journal of business venturing, 10(1), 43-58. google scholar
• Zeithaml, V. A., Parasuraman, A., & Berry, L. L. (1985). Problems and strategies in services marketing. Journal of marketing, 49(2), 33-46. google scholar
• Zimmerman, A., & Blythe, J. (2017). Business to business marketing management: A global perspective. Routledge. google scholar