CHAPTER ONE

INTRODUCTION

1.1    Background of the Study

In any organization whether profit or non profit oriented, the main purpose of the organization is to achieve its objectives. The objectives cannot be achieved in a vacuum; there must be a clearly set strategy that management should use in order to meet these objects.

Many businesses fail to realize that they cannot stay in business without any marketing strategies. This is because they were operating in a market that was monopolistic in nature. This means that there was no intense competition from other organization. But these days due to dynamic nature of the market, and consumer taste changes every day, it has become imperative on the part of the management to look into their strategies and review them if at all they want to remain in the business.

The integrated marketing communication mix consists of the subsets of marketing tools that are primarily communicational in nature. They are tools normally classified under promotion which is one of the controllable variables of the 4ps of marketing promotional mix, they are made up of advertising, personal selling, sales promotion, publicity etc. It helps in conveying message about the product offering to the customers, creating demand, market positioning, and to make a decision related to buy a product. Among the various promotional tools, it has been found that sales promotion is one which stimulates quick and large purchases in a limited period of time. It can be said that, sales promotion is the marketing activity that adds the value proposition related to a product (i.e., getting more for less) for a limited time in order to stimulate consumer patronage, effective sales and the effort made by the sales force. It includes premium, contest, sweepstake, buy one get one free, discount, point of purchase event, price offs, free gifts rebates etc. The element in the promotional mix that is rapidly gaining additional recognition in most industries especially in Bottling Company in Nigeria is the sales promotion. It is not enough mostly in developing countries like Nigeria in manufacturing to merely produce and trust that consumers will become aware of such products. The firm has to engage in promotional activities.

Over the years some notable authors have regarded sales promotion as having such role as:

·     Boosting sales in a particular geographical area

·     Appealing to special segments of the market

·     Attracting bargain hunting, non brand conscious buyer

·     Stimulating a new use of the product

·     Encouraging more frequent use of a product

·     Securing self space of a particular product

·     Encouraging seasonal sales or stimulating off peak period sales.

·     Offsetting price competition

Assisting sales force in presentation of their product because motivation and encouragement have been created.

        According to Anyanwn (1993) in his definition. He defined sales promotion “as comprising of wide variety of tactical promotion tools of short term incentive nature”. Promotional tools can as well be called special offer because they are extra and specifically carried out in a particular time and place. Nwokoye (2000) defined sales promotion as an activity that is used to stimulate sales of a product or services and usually occurring once or even over a limited period of time as a “Sales” conducted by a retail store or featuring price reductions of many item of marketing.

Kotler (2000) defined sales promotion as “a short term incentives aimed at encouraging purchase or sales of a product or services. He further points that sales promotion is designed to stimulate stronger target response. Nkem (2001) also went further to define sales promotion as a marketing communication efforts or promotional campaign activities articulated by business firms, carefully planned, organized, staffed, directed, monitored, controlled and carried out by marketing men.

        Sales promotion devices are usually classified based on the sources and the target. The source in this aspect could be the manufacturer, the wholesaler and the retailer and the target could be the consumer, organization or the industrial users, the wholesaler and the retailers. Sales promotion as a source of stimulating demand has various techniques that must be adopted which include samples, premium, coupon, cash rebates, contest, trade shows, buying allowance etc all these depend on who the source and the target are. So, this study generally tries to access the Impact of Sales promotion on Marketing of Soft Drinks in Abakaliki Urban: Sales Promotion Conducted by Nigeria Bottling Company Plc from 21^st March- 13^th June, 2014.

        The Nigeria Bottling company tool up its source from coca-cola international. It was established by John permberton. He is a pharmacist and has operated in Nigeria since 1953.

The Nigeria Bottling Company (NBC) was first commissioned at Apapa in Lagos State. It has the largest plant of all the branches of Nigeria Bottling Company. The branches include Enugu, Onitsha, Owerri, Jos, Kaduna, Ibadan, Aba, Manduguri etc, together with their various deport. A deport was established along Abakaliki-Enugu express way in 1980 from the branch office at Enugu.

It was headed by the Deport Sales Services Officer (DSSO). He is the senior superintendent and assisted by another sales supervisor together with the following people: Accountant, Drivers, store keeper, severity men and workers. The duty of the Deport sales service officer is to take care of the whole activities of the company. To see that every body focus on their activities in the company, while his assistance, the sales supervisor as his job implies to ensure  a full record of all the sales of the company. The storekeeper is in change of all the drinks in the Deport. His duty is when the Deport sales service officer gives the loading order to the fork lift operators; he will comply with the order and make sure that all the sales truck must be loaded accordingly. They usually move their drinks from the branch office Enugu to the Abakaliki Deport. They stock different brands like fanta, coke, krest, bitter lemon, sprite, krest tonic water, and club soda etc. They have 25cl, 35cl and 50cl alike in most cases.

1.2    Statement of the Problem

This research work aims to find out the significant impact of independent variables (sales promotional tools like premium, contest, and frequency programs) on dependent variable (marketing of soft drinks) towards purchase, of coca-cola products. As per previous studies, it has been found that among the various promotional mix elements sales promotion is the most stimulating variable for quick selling. There are various types of sales promotion tools used by the marketers but how to decide that which of them can stimulate the purchase.

1.3    Objectives of the Study

The main objective of this study is to examine the adequate impact of sales promotional tools on the Marketing of Soft Drinks in Abakaliki Urban.

The specific objectives are the following:

i.    To find the significant impact of contest on the marketing of soft drinks for consumers’ patronage towards coca-cola products.

ii.   To examine the significant impact of premium towards consumer purchase decision for coca-cola products.

iii. To examine the significant impact of frequency programs as an influencing tool towards consumer’s loyalty for coca-cola products.

1.4    Research Questions

i.    Do contests have significant impact on consumers’ patronage for coca-cola products?

ii.   To what extent does premium affect consumers’ purchase decision for coca-cola products?

iii. How adequate is the significant impact of frequency programs towards consumer loyalty for coca-cola products?

1.5    Research Hypotheses

       Hypothesis One

H_o: Contests have no significant impact on consumers’ patronage towards coca-cola products

H_i: Contests have significant impact on consumers’ patronage towards coca-cola products

       Hypothesis Two

H_o: Premium has no significant impact on consumers’ purchase decision towards coca-cola products.

H₂: Premium has significant impact on consumers’ purchase decision towards coca-cola products.

      Hypothesis There

H_o: Frequency programmes have no significant impact on consumer’s loyalty for coca-cola products.

H₃: Frequency programmes have significant impact on consumer’s loyalty for coca-cola products.

1.6    Significance of the Study

The findings of this study will be of immense benefit to:

i.    Nigeria Bottling Company: The findings of this study will be of benefit to the Nigeria Bottling Company because it will guide them on their next promotion exercise.

ii.   The competitors: The study will be of immense benefit to the competitors because it will guide them on planning their promotion exercise.

iii. Students/Researchers: The findings of this research work will be of great benefit to students and researchers who may wish to carryout a study on this topic in the future. The findings of this study will serve as a reference point to them.

1.7 The Scope of the Study

The scope evaluate the significance impact of sales promotion on marketing of soft drinks in Abakaliki Urban; sales promotion conducted by the Nigeria Bottling Company Plc from 21^st March to 13^th June, 2014. The Scope of the study is limited to Abakaliki Urban. Though the findings of the study can be used for generalization.

1.8    Limitations of the Study

The need for an in-depth research is desired but that urge to dig deep is limited by the following factors:

i.    Time constraint: The time available for this research work was grossly inadequate going by the extent of coverage researcher had in mind.

ii.   Difficulty in obtaining relevant data: This limited the scope of national content due to poor documentation method in Nigeria.

iii. Financial constraint: Finance is the first problem I encountered, which really restricted my research to certain level such as the cost of browsing the internet for data.

iv.  Risk: This is another factor ensuring that all questionnaires administered were not left out during conversation of data which contributed greatly in hindering the carrying out of this project work. The risk as well associated with going round Abakaliki Urban which is the area of the study.

1.9    Definition of Operational Terms

Sales promotion: Nkem (2001) define sales promotion as marketing communication efforts or promotional campaign activities articulated by business firms, carefully planned, organized, staffed, directed, monitored, controlled and carried out by marketing men.

Marketing: Is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large (Kotler 2013)

Loyalty: This is being addicted to a particular product out of habit (Kotler 2013)

Premium: Merchandise offered at a relatively low cost or free as to purchase of a particular product. A with-pack premium accompanies the product inside or on the package. A free in-the-mail premium is mailed to consumers who send in a proof of purchase, such as a box top or UPC code. A self-liquidating premium is sold below its normal retail price to consumers who request it. (Kotler 2013)

Frequency programs: Programs providing rewards related to the consumers’ frequency and intensity in purchasing the company products or services. (Kotler 2013)

Contest: A contest calls for consumers to submit an entry to be examined by a panel of judges who will select the best entries. (Kotler 2013)

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