ABSTRACT

Banks are established to make profits. Are these profits made at me expense of the customers or is it as a result of the seminar provided by these banks.
This study attempts to highlight those key factors that different banks managements will consider in their choice of branch locations and customers preferences for their choice of banks to serve them. This will enable banks to focus on the critical factor that affect market preferences.
The study was done using survey research design with questionnaire as due key instrument for collecting primary data. A total of 1000 and 200 bank customer and officials questionnaire respectively were duly completed and analyzed. Based on the analysis of the generated formulated hypothesis were tested at 95% level of significance using 2 test of proportion.
The underlisted constitute some of the major findings of the study, management of Banks have special preference for large markets like Lagos and Aba for their branch locations. Marketing activities of banks in these large markets are directed at protecting and expanding their stream of revenues in these areas. Banks in both markets describe the nature of their banking business in terms of the product/services they offer and their I.T power.
In the light of these findings, the study recommends that, Banks should posses profitable and complete range of product, continuous product service innovations and improvements. Banks should always invest heavily in information technology to remain relevant and profitable. As banks must to open branches in these markets, it is appropriate for banks to make their customer dependent on them and gain their trust and confidence.

CHAPTER ONE

INTRODUCTION
BACKGROUND OF THE STUDY
The deregulation of the Nigerian economy came into being in 1986. By that time, the banking industry was one of the most vibrant and most sought after by investor in Nigeria. According to Nwankwo (1991:2), the number of commercial and merchant banks rose from 33 (thirty three) commercial banks and 15 merchant banks in 1987 to 65 (sixty five) and 47 (forty seven) respectively in 1991.
The bank industry entered this decade with less caution but aware of global economic changes. According to Clausen (1990:12) the industry entered the new decade well aware that the world was about to change but in retrospect not fully realizing the far- reaching extent of that change nor its velocity and impact. In the ensuring six years the industry was unable to respond rapidly enough to the wrenching dislocation brought by deregulation, fierce new competition and unstable world economy. Crisis erupted within the first quarter of this decade and the condition deteriorated in the following area:
1. The industry was losing money, with not losses in billions since mid nineties.
2. Some of the banks suspended payment of dividends on their common stocks:
3. Some of the banks were facing hostile takeover attempts by the regulatory bodies (NDIC and CBN)
4. Regulatory bodies had directed several banks boards of Directors to redress the worsening capital base and 
5. Questions were raised about some of the banks ability to survive independently.
Marketing in the banking industry in Nigeria as we know today, owes much to the survival strategies of some new generation commercial and merchant banks after the banking distress of 1992 through 1996. This development attends the tastes and demands of the society stimulated competition and created selling opportunities and rewards. The banking habits now spread throughout the social classes.
New services have been introduced as the bank met competition, fill gaps in their services range, or try to steal a march on the competition by endeavouring to discover and satisfy the needs of new niche markets. Business customers have also witnessed the wind of change as the banks gained a greater appreciation in its highly profitable corporate markets. Thus, the banks own marketing expertise has been pushed along by competition and a desire to gain market share. It has also been pulled along it’s customers demanding more flexible advantageously priced and comprehensive facilities.
The needs of customers, and prospective ones, cannot be ignored by any bank especially in larger markets like Lagos and Aba environment. Relying merely on selling only those services which are already available is, at best, a short-term expedient, as market attitudes preference, technology and environmental factors are constantly changing.
To survive profit must be earned by banks and part of this process involves containment of cost when seeking the most profitable markets to exploit. Therefore, banks resources must be channeled towards the potentially more profitable “Banking markets” which in turn, necessitates making a choice among larger markets like Lagos, Aba, Kano, Onitsha, Kaduna etc. It is the identification of the right balance of resources that calls for the marketing skills of research, planning and assessment.

STATEMENT OF THE PROBLEM
Without customers, banks would have no revenues. Marketing is directed at protecting and expanding this stream of revenue. Organization (including banks) regards customers wherever they may be as their single most important reason for existing. They operate in a rapidly changing, regulatory and economic environment. Consequent upon this, it is the job of the marketer to understudy and understand the purchase decision/patterns of these customers who have been known to be difficult and complex in nature. The task become even different in the light of increasing competition, growing customer sophistication, and innovation in an environment of trade liberalization, financial deregulation and internationalization. The problem was further compounded by the recession in the economy, which led to the introduction of S.A.P (1990: 15) pointed out, between 1986 and 1992, there were low capacity utilization in most industries, declining per capita- income and reduced disposable income. The bank sector thus become more competitive and business environment like Lagos, Aba, Onitsha, Port Harcourt, Kano, etc developed peculiar business climates/markets, and attracted a large number of bank branches to their areas. Against this background, it became necessary for us to establish the locational factors that influence banks in the marketing of their financial services, with particular reference to Lagos and Aba markets.

OBJECTIVE OF STUDY
The objective of this study is to examine the locational factors influencing the marketing of financial services in Lagos and Aba markets. It will seek to do the following:
i Examine if there are locational differences between factors affecting banks preference for Lagos and Aba markets.
ii Consider the factors that determine banks preferences for a particular location in both Lagos and Aba markets.

RESEARCH QUESTIONS
For the purpose of this research, the following 
Questions will act as guide;
1. Why are banks establishing many branches in Lagos and Aba markets?
2. Do banks through various branches lend more in Lagos and Aba markets and make more profits?
3. Does accessibility to these bank branches influence the patronage of customers in these markets?
4. Is response time to customer’s enquiries and transactions in these areas an important attraction?
5. How important is technology (system support, computer etc.) to the customers in these areas?

FORMULATION OF HYPOTHESIS
Ho: Banks are not establishing many branches in Lagos and Aba markets;
Hi: Banks are establishing many branches in Lagos 
and Aba markets;
Ho: Bank do not lend more in their branches in Lagos and markets and make more profit.
Ho: Accessibilities to these bank branches does not influence their patronage in this bank market;
Hi: Accessibilities to these banks branches influences their patronage in these markets;
Ho: Response time to customers’ enquires and 
transaction is not an attraction to bank customers in Lagos and Aba markets;
Hi: Response time to customers’ enquires and transaction is an attraction to bank customers in Lagos and Aba markets.
Ho: Technology is not an important factors affecting customers’ preference in these areas.

SCOPE AND LIMITATION OF THE STUDY 
This study shall be restricted to Lagos and Aba business/Banking environment Lagos and Aba market were chosen because:
1. The head offices of about 90% of the banks are in Lagos.
2. The banks that do not have their head offices in Lagos, have regional offices and/or head office annexes
3. Many banks have either regional office and / or area offices in Aba.
4. Lagos is the nations industrial capital with over 75% of the more bank users.
5. The under listed 10 (ten) banks (by number of branches), have at least five branches in Lagos and at least two branches in Aba (excluding their cash centers).
BANKS BRANCHES NET WORK RANKING MARKETING SLOGANS
First bank of Nig. plc 319 1 Truly, the first
Union bank of Nig .plc 284 2 Big, strong, Reliable
United bank for Africa 219 3 The wise choice in banking
Afribank Nig. plc 137 4 The one stop bank
Savannah bank of Nig. 87 5 We treat you like a person.
Bank of the North Ltd. 86 6 We earn your confidence
Wema Bank plc 86 7 Reaching for greater heights
Standard trust bank Ltd. 77 8 Vision to become a role model for Africa B12
Habib Nig bank Ltd. 55 9 The bank with a difference
All State Trust bank plc. 47 10 The professional Bank.
Respondents for the study will be drawn from Banks senior officials and individual bank customers and due objectives will be to find out what inform their bank (branch) Locational considerations the under listed have been identified as some of the limiting factors:
1. Bas of Respondents:- The respondents are form different backgrounds with their own prejudices since they have no direct stake in this study. The reliability of data generated from them is suspect and will be fraught with many inconsistencies.
2. Sampling error:- I have only a sample to represent the entire population. The sample was selected using convenience- sampling technique since the sample is just a small representation of the entire population, sampling error is therefore inevitable.

SIGNIFICANCE OF STUDY
This research will attempt to show the locational factors influencing the marketing of financial services in Lagos and Aba markets. Issues to be analyzed will include people banking habits: branch network; technology application; interest rates on Loans; security of funds, response time amongst others. The customers will be classified into 2 (two) broad group for analysis viz corporate bodies, and
i. Corporate bodies, and 
ii. Individuals
We shall therefore strive to establish the existence of differences in factors that influence various bank choice of location in Lagos and Aba business banking environment.
Having established the existence of a difference or lack of it. The research will then make suggestions that would help banks price their product better in the Lagos and Aba competitive banking environments, improve on their technology applications, ensure security of customers funds and other general attributes that customers consider vital.