ABSTRACT
The study examined the effect of sales promotion on customer brand loyalty among GSM users in Umuahia. The study examined the relationship between (free megabyte incentive, free air time/night call incentive and customer loyalty. Descriptive survey design was used. The data was obtained with the use of questionnaire as a result instructive. 309 questionnaire was distributed to respondent in Umuahia. The data was analyzed using multiple regression analysis with the aid of SPSS version 20. The study reveal that free megabyte, discount call incentive have significant effect in customer loyalty. It was recommended that GSM providers should focus attention on discount calls and NCC should ensure that GSM operator fulfill their sales promotion claims.
TABLE OF CONTENTS
Title Page
Title
Page i
Declaration ii
Certification iii
Dedication
iv
Acknowledgement v
Table
of Contents vi
List
of Tables ix
List
of Figures x
Abstract
xi
CHAPTER ONE
INTRODUCTION 1
1.2 Statement of Problems 4
1.3 Research Objectives 5
1.4 Research Question 5
1.5 Statement of Hypothesis 6
1.6 Significance of the Study 6
1.7 Scope of the Study 7
1.8 Organization of Study 7
CHAPTER TWO
REVIEW OF RELATED
LITERATURE 8
2.1 Conceptual
Framework 8
2.1.1 Sales
Promotion Examined 10
2.1.2
History of Sales Promotion 11
2.1.3 Types of Sales Promotion 12
2.1.4 Objective of Sales Promotion 13
2.1.5 Sales
Promotion Tools and
Programme of Companies 16
2.1.6 Sales Promotion Strategies
and Management 23
2.1.7 Planning and Designing the Sales Promotion Programme. 23
2.1.8 Measuring the Effectiveness of Sales
Promotion 27
2.2 Theoretical Framework 28
2.3 Empirical Framework 33
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 INTRODUCTION 38
3.2 Research Design 38
3.3 Study Area 38
3.4 Population of Study 38
3.5 Sample Size Determination 39
3.6 Sampling Technique 40
3.7 Instrument 40
3.8 Validity 40
3.9 Reliability Test 40
3.10 Method of Data Analysis 42
CHAPTER
FOUR
4.0 DATA PRESENTATION, ANALYSIS AND
INTERPRETATION
4.1 General
Description 42
4.2 Hypotheses
Testing 49
CHAPTER FIVE
5.0 SUMMARY, CONCLUSION AND RECOMMENDATIONS 52
5.1 Summary 52
5.2 Conclusion 52
5.3 Recommendation 52
References 54
Appendix
CHAPTER ONE
INTRODUCTION
Telecommunication
is growing rapidly since the deregulation of the sector on 2001. The telecom
operator are trying their best to attract and return the customers through
various marketing strategies. This is a vertical link between sales promotion
and customer loyalty. A satisfied customer will keep on purchasing the products
even on the normal price. Dodson and Taybout (2001) in Saeed, Nisar and Ahmed
(2013) promotion acts V an external stimulus and there is less probability that
the customers will repurchase the products after the campaign is over.
Convincing customers and proselytizing them to switch to competitors requires
strategic motivational incentives (Barriors and Lansangan, 2012) cited by
Okolo, Agu, Obikeze and Ugonna, 2015). In their opinion organization have to
all of huge amount to engage promotional strategies that will make them
identify and remain loyal to a given brand having been acquainted with the
knowledge that customers are getting more and more advanced and sophisticated in
their approach to marketing realities. In order to retain customers;
telecommunication firms must develop marketing strategies that will not only
win the customer but also retain them. Sales promotion is regarded as the
marketing strategy or technique that will help promote sales, increase profit,
market share, product life cycle and enhance customers’ goodwill. Sales
promotion activities has been identified as a marketing tools adopted to
attract the attention of customer and build their loyalty in a product. It is
seen as a means used by firms to communicate with intended target audience. Sales
promotion refers to those promotional activities other than advertising,
publicity and personal selling that stimulate interest, trial or purchase by
final customers or others in the channel (Pillai, 2007 cited by Abiola and
Samson, 2015).
Sales
promotion is seen today as an enterprise marketing tools adopted by firms to facilitate
sales, usage or trail of a product or services to creates awareness sales
promotion provides extra-incentive for the target audience to make purchases or
support one brand over another thereby serving as a competitive weapon. Hence,
it increases market share (Abiola and Samson, 2015) sales promotion as
marketing incentives and inducements offered a target market has the potency of
spurring up efficiency along the channel of product distribution based on staff
force motivation for ultimate objective of turnover enhancement based on
increase in product demand (Oko, 2002 and Oko, 2014); therefore it is targeted at
the members of corporate sales force (personnel), members of the marketing
intermediaries and the ultimate consumers. Organization adopt the tools of
sales promotion as an aid to building brand loyalty, given its ability to
attract loyal and profitable customers and to protect the vendor from
competitions especially as it grants the vendor greater control in the planning
and blending of the marketing mix elements (Shira 2009 and Oko, 2014) firms
adopt sales promotion tool as weapon of warfare for securing and enhancing
marketing share, given the degree of market competition Odunalami And Ogunsiji,
2011), hence it is cast involving in terms of planning and execution (Preko,
2012, Oko and Nnanna, 2014). The important issues in sales promotion are the
generation of turnover, stock file, disconnection (elimination), enhancement of
vendor’s image and the action of price image (high – low). Vyas, 2007, Oko and
Nnanna, 2014).
In
the Nigeria telecommunication service market, like in most other sectors, sale
promotion aids the vendor manage the perceived financial, social and
psychological risks associated with product consumption, (Oko, 2013, Oko and
Etuk 2012, Oko and Egwu, 2014 and Oko and Nnenna, 2014) as consumers develop
confidence in the offer, as acquired from accredited vendors product usage
confirming to the societal norms and are within the technological awareness and
acceptance level of the society and as accepted brand are offered for sale during
a defined sales promotion marketing period.
Again,
the Nigeria telecommunication sector is highly competitive and the operators
attempt to appeal and win customers through various sales promotion strategies.
The Nigeria telecommunication industry is entering its maturity phase, with
reducing average profits with fierce competitive telecom operators must work
hard to reduce cost, win new customers and return existing ones and increase
profit to ensure sustainable development of their business (Oyeniyi Omotayo,
2011). The telecommunication sector is the most developing industrial sector in
Nigeria since its deregulation in 2001. The deregulation commenced with the
granting of license to three companies to provide wireless telecommunication
services using the global system for mobile (GSM) platform. They are the Mobile
Telecommunications Networks (MTN), Mobile Telecommunication Service (Mitel) and
Econet wireless Nigeria now Airtel. There were 127, 10 million active lines for
the three industry operators as at March 2014, (NCC Report 2014) which is
divided as follows: Mobile GSM – 124.88m (98.5%), mobile (DMA – 2.04m (1.60%)
and fixed wireless 0.11m (0.13%). Presently, four national GSM carriers MTN,
Globacom (Glo), Airtel and Etisalate) and other secondary CDMA operators render
telecommunications services in Nigeria, these GSM providers are competing for
all the GSM customers/subscribers in the country since inception in 2001
(Aghara, 2005).
Many
academic work or research have been done on the telecommunication industry as
it affects the Nigeria consumer. Some of the studies includes effects of customer
loyalty strategies on customer satisfaction among GSM services providers in
South South Nigeria sales promotion in the marketing of telecommunication
service in Nigeria: impact analysis most of the study may not be very
reflective of consumers in South East region, this study bridge the gap.
1.2 Statement of Problems
The
Nigeria telecommunication sector is highly competitive and has allowed
competing telecommunication firm since the inception in 2002. (MTN, AIRTEL, GLO
and ETISALT). The customers of these GSM firms have various choices to make and
this competition tends to enhance efficiency to a large extent. Sales promotion
strategy is seen as a tool used widely by competing telecommunication players
in Nigeria (Omotayo, 2011).
As
rightly observed by Okolo, Agu, Obikeze and Ugonna (2015) the Nigeria GSM
service subscribers are tired of complaining about network failures, cross
lines, drop calls, poor internet connectivity, high call tariffs and general
poor customer care service. These are complaints that tend to make a customer
frequent stricting from one GSM firm to the other in search of satisfaction.
However, improving customer satisfaction through sales promotional activities
by telecommunication industry can lead to customer loyalty.
1.3 Research Objectives
The
main objective of this research is to evaluate the effect of sales promotion in
customer loyalty. The specific objectives includes:-
1. To ascertain the various consumer sales
promotion incentives by telecommunication firm.
2. To examine the influence of free air
time/night calls incentive on customer loyalty.
3. To examine the influence of free
megabytes incentive on customer loyalty.
4. To examine the influence of discount
calls incentive on customer loyalty.
5. To examine the influence of free sms/mms
incentive on customer loyalty.
1.4 Research
Question
In
line with the research objectives, the following research questions will guide
this study.
1. What are the various sales promotional
incentives adopted by telecommunication firms?
2. To what extent does free air/night call influence
customer loyalty?
3. To what level of influence does free megabyte
have on customer loyalty?
4. To what extent does discount calls
influences customer loyalty?
5. To what extent does free sms/mms
influences customer loyalty?
1.5 Statement
of Hypothesis
The following hypothesis will provide
direction for the study.
Ho1: Free
airtime/night calls will not significantly influence customer loyalty.
Ho2: Free
megabyte will not significantly influence customer loyalty.
Ho3: Discount
calls will not significantly influence customer loyalty.
Ho4: Free
sms/mms will not significantly influence customer loyalty.
1.6 Significance
of the Study
The
main thrust of the study is to investigate the effect of sales promotion on
customer loyalty in telecommunication industry. This research when completed
will be befitted to the following:
Telecommunication Organization:
The
study will immensely help the service providers to better understand how the
variable free airtime/night calls, free megabytes, discount call, free sms/mms will
influence brand loyalty. This will enable the service providers adjust their
offerings to suit these consumer requirements.
The Regulatory Body NCC: The body will equally benefit immensely
from the findings of this study. Their regulatory/supervisory role and policy
making direction will be further enhanced, by ensuring that the providers
comply with all critical/technical requirements that will guarantee safe and
efficient service delivery to the consumers.
Academic Community: The research will add to the body of
knowledge in the GSM telecommunication industry, which has attracted many
scholarly papers since the deregulation of the sector in 2001. It will be a
reference materials for scholars, teachers, researchers for further research,
based on finding.
1.7 Scope of the Study
This
study is in the effect of sales promotion on customer loyalty. The subject scope
is marketing communication and consumer behavior. The geographical scope is GSM
users in Abia State, finally the coverage spouse is made up of MTN and Glo
users in Abia State.
1.8 Organization of Study
The
research is organized in chapters. Chapter one contains the introduction,
problems statement, objectives, significance of the study, limitation and
hypothesis.
Chapter
Two will review some related literature, theoretical review, empirical review
and conceptual framework.
Chapter
three deals with research methodology, research design, instruments for data
collection, method of data collection and analysis.
Chapter
four deals with presentation and analyzed data collected using tables,
percentages.
Finally,
chapter five summarizes the study at large, makes conclusion, as well as useful
recommendations.
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