EFFECT OF SALES PROMOTION ON MARKETING PERFORMANCE OF NIGERIAN BREWERIES

ABSTRACT

This research focused on Effectiveness of Sales Promotion on Consumer Decision Making. The specific objectives of the study include determining the effect of sales promotion on customer patronage, examining the effect of sales promotion on increase in sales volume, to determine the effect of sales promotion on organizational profitability and to assess the effect of Sales Promotion on increase in Market Share. Primary data was collected from respondents in Abia state on their views about Sales Promotion and Consumer Decision making with the help of a well-structured questionnaire from 135 valid respondents. Results from the correlation analysis on the Effect of Sales Promotion on Customers’ Patronage showed a satisfactory positive relationship between Sales Promotion and Customer Patronage. The result of the analysis implies that the higher the Sales Promotion, the greater the Customers’ Patronage. The Effect of Sales Promotion on Sales Volume was tested using bivariate regression analysis the result shows that there is a strongly positive association between Sales Promotion and Sales Volume. The value of the correlation coefficient between Sales Promotion and Organizational Market showed that r = 0.667**, N = 135, Sig <0.05. This implies that a 1% increase in Sales Promotion will lead to 66.7% increase in Organizational Market Share. Therefore, Sales Promotion and Organizational Market Share are correlated positively. As a recommendation, Organizational firms should know that market Share, Sales Volume and Customer Patronage cannot be effectively achieved if there isn’t efficient Sales Promotion. Sales Promotion plays a vital role in Sales Volume and Customer Patronage. Thus, adequate Sales Promotion strategies need to be formulated and implemented to optimize profit. Marketing research that focuses on the Sales Promotion, Customer Patronage, and Sales Volume that can be desired by consumers should be conducted.

TABLE OF CONTENTS

Title page                                                                                                            i

Declaration                                                                                                         ii

Certification                                                                                                        iii

Dedication                                                                                                          iv

Acknowledgements                                                                                            v

Table of contents                                                                                                vi

List of tables                                                                                                       ix

Abstract                                                                                                              x

      References

CHAPTER ONE

INTRODUCTION

1.1   Background Of The Study                                                                     1

1.2  Statement Of The Problem                                                                     3

1.3     Objectives of the study                                                                             4

1.4     Research Questions                                                                                  4

1.5     Research Hypotheses                                                                               5

1.6     Significance of the Study                                                                         5

1.7     Scope of the study                                                                                    6

1.8     Limitations of the study                                                                           6

CHAPTER TWO

2.0      REVIEW OF RELATED LITERATURE

2.1     Conceptual Framework                                                                            7

2.1.1   Definitions of Sales Promotion                                                               8

2.1.2    Effect of Sales Promotion on Organizational Performance           9

2.1.3    Major Types of Sales Promotion techniques                                         10

2.1.4      Relationship between Sales Promotion and Organization

               Effectiveness                                                                                       16

2.1.5      Consumer behavior                                                                              19

2.1.6      Sales promotion and consumer behavior                                             19

2.2     Theoretical Framework                                                                            20

2.2.1    The Push Theory                                                                                    20

2.2.2      The Pull Theory                                                                                    21

2.2.3        The Combination Theory                                                                   21

2.3     Empirical Review                                                                                    22

CHAPTER THREE

3.0  RESEARCH METHODOLOGY                                                            25

3.1     Research Design                                                                                      25

3.2     Area of the Study                                                                                     25

3.3     Sources of Data/Method of Collection                                                    26

3.4     Population of the study                                                                            26

3.5     Sampling Procedure and Sample Size                                                     26

3.6     Validity of instrument                                                                              27

3.7     Reliability of the instrument                                                                    27

3.8    Method of Data Analysis                                                                           27

CHAPTER FOUR

4.0  RESULTS AND DISCUSSION                                                                         28

4.1     Effect of Sales Promotion on Customers’ Patronage                               28

4.2          Effect of Sales Promotion on Sales Volume                                            29

4.3          Effect of Sales Promotion on Organizational Profitability                               31

CHAPTER FIVE

5.0       SUMMARY, CONCLUSION AND POLICY RECOMMENDATION

5.1      Summary of Findings                                                                              35

5.2      Conclusion                                                                                              36

5.3     Recommendations                                                                                    38

                                LIST OF TABLES

TABLE 4.1  Distribution of questionnaire and response rate

TABLE 4.2  Distribution of respondents according to age

TABLE 4.3 Distribution of respondents according to educational qualification

TABLE 4.4     Distribution of respondents according to years of services

Table 4.4     Distribution of respondents according to years of services

 Table 4.5:   Distribution according to Religion

CHAPTER ONE

1.0     INTRODUCTION

1.1     Background of the study

Sales promotion is an initiative undertaken by organizations to promote increase in sales, usage or trial of a product or services (Adeleye, 2006) {i.e. initiations that are not covered by other elements of the marketing communication/promotional mix}.  Sales promotion is an important component of an organizations overall marketing strategy along with advertising, public relations, and personal selling. Sale promotion acts as a competitive weapon by providing an extra incentive for the target audience to purchase or support one brand over another.  It is particularly effective in spurring product trial and unplanned purchases (Aderemi, 2003). 

Most marketers believe that a given product or service has an established perceived price or value, and they use sales promotion to change this price value relationship by increasing the value and/or lowering the price compared with other components of the marketing mix (advertising, publicity, personal selling). In determining the relative importance to place sales promotion in the overall marketing mix, an organization should consider its marketing budget, the stage of the product in the life cycle, the nature of competition in the market, the target of the promotion, and the nature of the product (Nwokoye, 2000). For example, sales promotion is particularly attractive alternative when the budget is limited.  In addition, sales promotion can be effective tool in a highly competitive market, when the objective is to convince retailers to carry a new product or influence consumers to select it over those of competitors.  More so, sales promotion tends to work best when it is applied to impulse items whose features can be judged at the point of purchase, rather than more complex, expensive items that might require hands on demonstration. Sales promotion includes communication activities that provide extra value or incentives to ultimate consumers, wholesalers, retailers or other organizational customers thereby increasing growth of the market.  It also stimulate sales, product trial (Kotler and Keller, 2006). According to Shimp (2003), sales promotion refers to any incentive used by a manufacturer to induce the trade (wholesalers, retailers, or other channel members) and/or consumers to buy a brand and to encourage the sales force to aggressively sell it.  kotler (2003) sees Sales Promotion  a key ingredient in marketing campaigns and consists of a diverse collection of incentive tools, mostly short term designed to stimulate quicker or greater purchase particular products or services by consumers. Sales promotions programmes are those activities other than stimulate consumer purchase. Sales promotion is an important component of an organizations overall marketing strategy along with advertising, public relations, and personal selling. Sale promotion acts as a competitive weapon by providing an extra incentive for the target audience to purchase or support one brand over another (Odunlami and Ogunsiji, 2011).

1.2     Statement of the problem

Despite all the benefits derivable from sales promotion and the need to keep up with stiff competition in the market place, many organizations especially in developing countries still fail to accept sales promotion tool to reckon with(Katz and Kahn, 2008). It is true that consumers of both industrial and consumer goods exhibits various attitudes and behaviour towards the products and services rendered and offered to them. This is basically because presently consumers’ income is low due to economic predicaments coupled with the other environmental factors that influence their buying habit. Many consumers prefer to spend their hard earned resources on essential goods like: food stuff, clothes and other immediate requirement (Davies et al., 1992). Manufacturers are faced with the problem of product substance and competition. For that reason, many manufacturers now attempt to stimulate and get customer attention with customer loyalty, increase market share by using sales promotion tools on goods and services. But these has not been all that successful due to some problems such as lack of management know how, not appointing the right and experienced marketers or sales promotion expert  (Alawiya, 2014). When sales promotion is poorly carried out, it affects sales volume and profit. The problems of low sales and demand have prompted producers to use sales promotion to compliment the use of other promotional mix. Nevertheless, it has been observed that most producers do not employ the appropriate use of sales promotion tools and methods, to enhance the achievement of stated goals and have neglected the important marketing concept which is people oriented philosophy that regards the customers as kings and the sole aim of the business existence (Idemobi, 2012).

1.3     Objectives of the study

The broad objective of the study is to determine the effect of sales promotion on market growth. The specific objectives of the study are, to;

i.               determine the effect of sales promotion on customer patronage.

ii.             examine the effect of sales promotion on increase in sales volume.

iii.           determine the effect of sales promotion on organizational profitability.

iv.           assess the effect of sales promotion on increase in market share.

1.4     Research Questions

(i)            What are the effects of sales promotion on customer patronage?

(ii)          What are the effects of sales promotion on increase in sales volume?

(iii)         What are the effects of sales promotion on organizational profitability?

(iv)         What are the effects of sales promotion on increase in market share?

1.5     Research Hypotheses

 For the purpose of the study, the following hypotheses will be tested in null form

H₀₁:There is no significant relationship between sales promotion and market growth.

H₀₂:There is no significant relationship between sales promotion and customer patronage.

H₀₃:There is no significant relationship between sales promotion and organizational profitability.

1.6     Significance of the Study

The study will be quite significant to marketers, this is because the study would enable them to know the need to adopt sales promotion strategy in order to increase their market growth. Sales promotion is one of the marketing strategies that helps in customer patronage and increase in both sales volume and profit. Every organization that wants excel in the market need to adopt sales promotion and a clear knowledge of this work would guide organization in making such decision. The study would also be significant to consumers because consumers need to be satisfied in any product purchased and sales promotion guarantees customer satisfaction. The study would also be significant to scholars and researchers because the study would serve a reference material for future research.

1.7     Scope of the study

The scope of the study is the effect of sales promotion on market growth. The study will be carried out in Abia state using Nigeria breweries plc Aba, Abia State for data generation. The study will be focusing more on effects of sales promotion on customer patronage, effects of sales promotion on increase in sales volume, effects of sales promotion on organizational profitability and effects of sales promotion on increase in market share.

1.8     Limitations of the study

Perceived limitations to this study will include the following;

Financial Constraints:   To effectively complete a research work of this nature, good amount of money is required. Although the researcher, as a student, is not financially dependent, she is poised to making the best use of the available monetary resources to get the job properly done.

Time Constraint:            This the period of time needed for the researcher to source for   information. The time given for this research work may not be enough for the researcher to gather all the necessary information that is needed.

Unavailability of Record:        Lack of record has been a major constraint to the researcher. Most of the required data are either no where to be found or refused to be disclosed by the holders.

Buyers has the right to create dispute within seven (7) days of purchase for 100% refund request when you experience issue with the file received. 

Dispute can only be created when you receive a corrupt file, a wrong file or irregularities in the table of contents and content of the file you received. 

ProjectShelve.com shall either provide the appropriate file within 48hrs or send refund excluding your bank transaction charges. Term and Conditions are applied.

Buyers are expected to confirm that the material you are paying for is available on our website ProjectShelve.com and you have selected the right material, you have also gone through the preliminary pages and it interests you before payment. DO NOT MAKE BANK PAYMENT IF YOUR TOPIC IS NOT ON THE WEBSITE.

In case of payment for a material not available on ProjectShelve.com, the management of ProjectShelve.com has the right to keep your money until you send a topic that is available on our website within 48 hours.

You cannot change topic after receiving material of the topic you ordered and paid for.