This study examines the impact of sales promotion on
marketing of soft drinks in Abakaliki Urban: (study of sales promotion
conducted by Nigeria Bottling Company Plc from 21st March to 13th June, 2014).
The main objective of the study was focused on the adequate impact of sales
promotional tools on the marketing of soft drinks in Abakaliki urban. Sales
promotion is an important component of any organization’s overall marketing
strategies along side advertising, public relations, and personal selling. The
study was significant because, it contributed new knowledge by filling and
reducing the gab that existed in the understanding of sales promotion by
retailers and distributors of coco-cola products. It also serves as source of
reference to other researcher in this field. The literatures reviewed in this
study were conceptual framework empirical framework and theoretical framework.
A descriptive survey research design was applied. The sample size employed was 124
respondents which were distributors and retailers of coca-cola products.
Questionnaires were administered to the sampled respondents to collect primary
data used for this study. However, the study made use of survey design and
purposive sampling technique in selecting the respondents comprised of
distributors and retailers of coca-cola products. 5-points Likert rating scale
was used to present the data collected for the study. Chi-square technique
independence test was used to test the hypotheses stated. The results found
that sales promotional tools such as premium, contests and frequency programmes
have significant impact on the marketing of coca-cola products. It was concluded
that in the course of any sales promotion exercise, management should
strategically facilitate the exercise so that customers would not doubt the
reality of the programme by using credible techniques.
APPROVAL PAGE.. i
DEDICATION.. iii
ACKNOWLEDGEMENT.. iv
Abstract. vi
TABLE OF CONTENTS.. vii
LIST OF TABLES.. x
CHAPTER ONE.. 1
INTRODUCTION.. 1
1.1 Background of the Study. 1
1.2 Statement of the Problem.. 6
1.3 Objectives of the Study. 7
1.4 Research
Questions. 7
1.5 Research
Hypotheses. 8
1.6 Significance
of the Study. 8
1.7 The Scope of the Study. 9
1.8 Limitations
of the Study. 9
1.9 Definition of Operational Terms. 10
CHAPTER TWO.. 12
LITERATURE REVIEW... 12
2.1 Conceptual
Framework. 12
2.1.1 Implementing
and Evaluating the Program.. 17
2.1.2 Types
of Sales Promotion. 18
2.1.3 Advantages
of Sales Promotion. 21
2.1.3 Problems
of Sales Promotion. 21
2.1.4 Objectives
of Sales Promotion. 23
2.1.5
The Strength and strategies of Sales
Promotion. 25
2.1.6 The
Determinants of Sales Promotion Effectiveness. 26
2.1.7 Consumers
Attitude towards Sales Promotion. 29
2.1.8 Managing
Sales Promotion. 33
2.1.9 The
History and Growth of Sales Promotion. 33
2.2 Empirical
Framework. 37
2.3 Theoretical
Framework. 41
2.4 Gap in the Literature. 43
CHAPTER THREE.. 44
RESEARCH METHODOLOGY.. 44
3.1 Introduction. 44
3.2 Research Design. 44
3.3 Areas of Study. 45
3.4 Population of the Study. 45
3.5 Sample Size. 45
3.5 Instrument for Data Collection. 46
3.6 Validation of Instrument 47
3.7 Reliability of the Instrument 48
3.8 Procedures for Data Distribution
and Collection. 49
3.9 Method of Data Analysis. 49
3.10 Decision Criteria for Testing of
hypothesis. 50
CHAPTER FOUR.. 51
DATA PRESENTATION AND ANALYSIS.. 51
4.1 Introduction. 51
4.2 Data
Presentation. 51
4.3 Analyses of Data. 65
4.3.1
Hypothesis One. 66
4.3.2
Hypothesis Two. 69
4.3.3 Hypothesis
Three. 72
4.4 Discussion of Result 76
CHAPTER FIVE.. 77
SUMMARY OF FINDINGS, CONCLUSION AND
RECOMMENDATIONS.. 77
5.1 Introduction. 77
5.2 Summary of Findings. 77
5.3 Summary of Conclusion. 79
5.4 Summary of Recommendations. 80
REFERENCES.. 82
APPENDIX.. 87
QUESTIONNAIRE GUIDE.. 87
Table 4.2.1: Age
Distribution. 52
Table 4.2.2: Sex Distribution. 53
Table 4.2.3: Marital Status 53
Table 4.2.4: Contests, premium and frequency programs are among promotional tools
used by Nigeria Bottling Company Plc to market their products. 54
Table 4.2.5: The significant impact of contests increased consumers’ patronage for
coca-cola products. 55
Table 4.2.6: The adequate impact of premium changed consumers’ purchase decision
towards coca-cola products 56
Table 4.2.7: The effectiveness of frequency programs has more significant impact on
consumers’ loyalty for coca-cola products. 57
Table 4.2.8: Consumers’ patronage for coca-cola products is encouraged by the use
of contests as a promotional tool strategy. 58
Table 4.2.9: Premium enhances the significant impact of consumers’ purchasing
decision towards coca-cola products. 59
Table 4.2.10: Frequency programs a promotional tool helps to retain consumers’
loyalty towards coca-cola products 60
Table 4.2.11: Premiums affects consumers’ purchasing decision for coca-cola
products. 61
Table 4.2.12: Contest has significant impact on consumers’ patronage for coca-cola
products. 62
Table 4.2.13: Frequency programs adequacy motivates consumers’ loyalty for coca-cola
products. 62
Table 4.2.14: Premium determines the adequate impact of consumers’ purchasing
decision for coca-cola products. 63
Table 4.2.15: It has
been noticed that the Nigeria Bottling Company Plc is the market leader in the
Nigeria soft drink industry. Contest, premium and frequency programs are the
key success of coca-cola products performance in the market. 64
Table 4.3.16: Observed frequency table (fo) 66
Table 4.3.17: Expected frequency (Fe) table. 67
Table 4.3.18: Table for Fo-Fe. 67
Table4.3.19: (Fo-Fe)
. 68
Table 4.3.20: Computation for Chi-square 68
Table 4.3.21: Observed frequency table (fo) 70
Table 4.3.22: Expected frequency (Fe) table. 70
Table 4.3.23: Table for Fo-Fe. 71
Table 4.3.24: Table for (Fo-Fe). 71
Table 4.3.25: Computed chi-square 71
Table 4.3.26: Observed frequency (Fo) table. 73
Table 4.3.27: Excepted frequency (Fe) table. 73
Table 4.3.28: Table for Fo-Fe. 74
Table 4.3.29: Table for (Fo-Fe). 74
Table 4.3.30: Computation for Chi-square 74
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 with a particular reference to the: sales promotion,
conducted by Nigeria Bottling Company Plc between 21st March and 13th
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.
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.
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.
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?
Hypothesis
One
Ho: Contests
have no significant impact on consumers’ patronage towards coca-cola products
Hi: Contests
have significant impact on consumers’ patronage towards coca-cola products
Hypothesis
Two
Ho: 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
Ho: 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.
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.
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 21st March to 13th
June, 2014. The Scope of the study is limited to Abakaliki Urban. Though the
findings of the study can be used for generalization.
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.
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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