ABSTRACT
The study investigated the response of customers to sales promotion of selected commercial banks in Imo State, Nigeria. The specific objectives were to; ascertain the influence of entry qualification on customers response to sales promotion; determine the effect of promo timing and duration on customers response to sales promotion; establish the effect of reward redemption process on customers response to sales promotion; discover the influence of reward value on customers response to sales promotion; prove the effect of promo awareness level on customers response to sales promotion; and ascertain the influence of promo presentation style on customers response to sales promotion.. To achieve the objectives of the study, survey research design was adopted. The researcher adopted primary data and used questionnaire as a tool in getting the required information. In testing the hypotheses, multiple regression models was used. The findings further revealed that there is a significant relationship between promo timing and duration and customers response to sales promotion. The findings further showed that there is no significant relationship between Reward Redemption Process and response to customers to sales promotion. The researcher recommended that Commercial Banks should closely pay attention to entry requirements of their sales promotion such entry requirements like minimum account balance, periodic deposit of a given sum of money or opening of new accounts (for prospective customers) should be one that is customer friendly and convenient to customers income, time and comfort. The researcher further recommended that Commercial Banks should carefully choose the right start and end dates for sales promotion that take into account major festive seasons. The duration of a sales promotion should be moderate-neither too long nor too short
TABLE OF CONTENTS
Title page i
Declaration ii
Certification iii
Dedication iv
Acknowledgement v
Abstract vi
Table of
Content
CHAPTER ONE:
INTRODUCTION
1.1 Background
to the Study 1
1.2 Statement
of Problem 3
1.3 Objectives
of the Study 4
1.4 Research
Question 4
1.5 Research
Hypotheses 5
1.6 Scope
of the Study 6
1.7 Significance of the Study 6
1.8 Limitation
of the Study 7
CHAPTER TWO:
REVIEW OF RELATED LITERATURE
2.1 Conceptual Framework 8
2.1.1 Meaning of Sales Promotion 8
2.1.2
Banks Sales Promotional Tools 11
2.1.3
Sales promotion and Consumer Behavior 16
2.1.4 Brand Loyalty 17
2.1.5 Brand Switching 18
2.1.6
Culture and Consumer Behavior 18
2.1.7 The relationship between sales promotions and
consumer buying behavior 19
2.2 Theoretical Framework 20
2.2.1 Technology Acceptance Model 20
2.2.2 Theory of Planned Behavior 20
2.3 Empirical Review 21
CHAPTER THREE:
METHODOLOGY
3.1 Research Design 25
3.2 Area of the Study 25
3.3 Sources of Data 25
3.3.1 Primary source of data: 25
3.3.2 Secondary source of information: 26
3.4 Population of the Study 26
3.5 Sampling Techniques and Sample Size 26
3.5.1 Sample Size 26
3.5.2 Sampling Techniques 26
3.6 Description of Research Instrument 26
3.7 Validity of the Instrument 27
3.9 Reliability of the Instrument 27
3.10 Method of Data Analysis 27
3.11 Model Specification 27
CHAPTER FOUR: DATA
PRESENTATION ANALYSIS
4.1 Questionnaire
Administration 29
4.2 Sample
Characteristics 30
4.3 Data
Presentation 31
4.3.1 Distribution
of Respondents by Education 31
4.3.2 Distribution of Respondents by Age Groups 32
4.3.3
Distribution of Respondents by Marital Status 32
4.4 Analysis
of Research Questions 33
4.4.1 Research
Question one 33
4.4.2 Research
Question Two 33
4.4.3 Research
Question Three 33
4.4.4 Research
Question Four 34
4.4.5. Research Question five 34
4.4.6 Research question six 34
4.5 Test of
Hypotheses 34
4.5.4 Test of
Hypothesis Two (Ho2) 36
4.5.5. Test of
Hypothesis Three (Ho3) 36
4.5.6 Test of
Hypothesis Four (Ho4) 36
4.5.7 Test of Hypothesis Five (Ho5) 37
4.5.8 Test of
Hypothesis Six (Ho6) 37
4.6 DISCUSSION
OF FINDINGS 37
CHAPTER FIVE:
SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 Summary 40
5.2 Conclusion 40
5.3 Recommendations 40
REFERENCES
APENDICES
CHAPTER
ONE
INTRODUCTION
1.1 Background
to the Study
With
the advancement of technology, a variety of new products are developed and
innovated into the already present market to improve the quality of life. One
of the most effective and easiest ways to be outstanding among the competitive
market world is to apply sales promotion. Promotion is classified as one of the
backbones of marketing mix, which is used to increase the consumer’s purchasing
behavior (Kotler and Keller, 2006)
Research proposed that among the competitive
business, promotion is an essential factor to a new product and present product
to continue surviving in the market shelf (Abdalnaser et al, 2011). Based on a marker’s perspective, sales promotion has
acted as a vital tool to increase sales and profit within a short period of
time. Meanwhile, as consumers, we are surrounded by promotion in our daily life
without being noticed..Therefore, the implication and effectiveness of sales
promotion have received high attention and concern (Ndubuisi and chiew, 2005).
It
has been reviewed the type of sales promotion which have played an important
role in influencing the purchasing behaviour of the potential customers
(Alvarez and Casielles, 2005; Chandon et
al, 2000; Hendel and Nevo, 2006; Kalaiselvan, 2013). Moreover, due to the
consistent exposure to variety of sales promotion and individual differences,
each unique customer has developed a different perception and response towards
sales promotion.
Improvement
activities include incentives which contribute to higher value of revenues and
which increases the interest of staff, traders customers for product (Senic,
2003). For others, sales promotion is defined as a key element in marketing
campaigns which help the institution to achieve its long-term goals, primarily
through attracting new customers and creating loyalty with existing ones
(Oyedapo, et al., 2012). However,
according to the most comprehensive definition of sales promotion includes
series of stimulus funds (mostly short term) designed to stimulate quicker or
greater purchase of a particular products or services by customers (Blattberg
and Neslin, 1990). In other words, sales promotion is considered to be the most
stimulating promotional technique which help sales directly, but in a short term,
i.e, which has an influence on purchasing decision of consumer or business
customers. Precisely, while advertising offers reasons to buy, sales promotion
offers an additional incentive to purchase (Palmer. 2004).
Sales
promotion as a key component in marketing campaigns, includes activities of
sales promotion both to consumers and business customers, as well as activities
to improve business operations and sales force (Kotler and Keller, 2006). And
although each of the types of sales promotion deserves special attention, the
subject of this research will be the method of sales promotion directed at bank
customers.
Marketers
have come to realized that advertising alone is not always enough to move their
products and services into the hands of customers. Sales promotion is used to
ensure that customers are aware of the products that organizations offer. Sales
promotional activities were originally intended as short term incentive aimed
at producing immediate customer buying responses. Consumer promotions are short
term incentives targeted directly at consumers and they include; free offers,
patronage reward and other incentives. Traditionally, these techniques were
viewed as supplements to other element of the firm’s promotional mix.
Priya
et al, (2004) suggested that
promotion is a temporal offer to customers which are designed to achieve a
specific sales objective.
Promotional
activities are integral part of many marketing plans, and financial
institutions continue to spend a large amount from their communication budget
on sales promotion and it is estimated that 75 percent of banks marketing
communication budgets are allocated to sales promotion (Low and Mohr, 2000).It
is against this background that the study tends to evaluates response of
customer to sales promotion of selected deposit money banks in Nigeria.
1.2 Statement
of Problem
Majority
of the deposit money banks are currently facing unprecedented competition,
declining loyalty, increased promotional sensitivity, brand proliferation,
increase in taxes and increase accountability as a result of the government’s
trade liberalization policy. This situation has resulted to loss of sales
revenue to firms, sometimes so severe that some have to close down. This is in
accordance with what Peattie and Peattie (1993) claimed about sales promotions
becoming so common that firms are obliged to follow or risk losing market share
or close down. Previous researchers have mainly investigated the effectiveness
of the traditional marketing communication channels in eliciting consumers’
responses with little emphasis on the promotional mix (Mazia, 2005). Researches
on customer’s response to sales promotion have been heavily skewed in examining
the influence of social-economic, demographic and personal characteristics of
consumers. Very few research have focus on the influence of characteristics of
promotion itself on customer response to sales promotion. Also, studies on
customers’ response to sales promotion with respect to product have received
considerable amount of attention. Very few research have focus on this issue
vis-à-vis service especially financial services. Among the very few research
that have examined customers response to sales promotion with respect to
financial services, there exist no study research in Imo State, Nigeria. The
uncertainty and interesting outcome surrounding the nature of the consumers’
responses to sales promotion is quite captivating. It is against all these
issues raised that necessitates this research.
1.3 Objectives
of the Study
The
broad objective is to determine the response of customers to sales promotion of
selected commercial banks in Imo State, Nigeria. The specific objectives are
to;
(i)
ascertain the influence
of entry requirements on customers response to sales promotion.
(ii)
determine the effect of
promo timing and duration on customers response to sales promotion.
(iii)
establish the effect of
reward redemption process on customers response to sales promotion.
(iv)
discover the influence of
reward value on customers response to sales promotion.
(v)
prove the effect of promo
awareness level on customers response to sales promotion.
(vi)
ascertain the influence
of promo presentation style on customers response to sales promotion.
1.4 Research
Question
The
study will seek to answer the following questions
(i)
Does entry requirements
have influence on customer’s response to sales promotion?
(ii)
What effect does promo
timing and duration have on customers’ response to sales promotion?
(iii)
What effect does reward
redemption process have on customers’ response to sales promotion?
(iv)
Does reward value have
influence on customers’ response to sales promotion?
(v)
What effect does promo
awareness level have on customers’ response to sales promotion?
(vi)
Does promo presentation style
have influence on customers’ response to sales promotion?
1.5 Research
Hypotheses
The following hypotheses
has been formulated in null form for this study
HO1:
There is no significant relationship between entry requirements and customers’
response to sales promotion.
HO2:
There is no significant relationship between promo timing and duration on
customers’ response to sales promotion.
HO3:
There is no significant relationship between reward redemption process and
customers response to sales promotion.
HO4:
There is no significant relationship between reward value and customers’
response to sales promotion.
HO5:
There is no significant relationship between promo awareness level and
customers’ response to sales promotion.
HO6:
There is no significant relationship between promo presentation and style and
customers’ response to sales promotion.
1.6 Scope
of the Study
The
study focused on promotion strategy with emphasis on sales promotion, factors
of interest that may influence customer response include; Entry Qualification,
Promo timing and duration, Reward
Redemption Process, Reward value, Promo Awareness Level, and Promo presentation
and style.
The
study is domiciled in Imo State. The 3 senatorial zones of the State were the
area focus of the study. The sampling units of the study are customers of
commercial banks who either owns current or saving accounts.
1.7 Significance of the
Study
The
study will be quite significant to the following group of people; banks,
customers, government, scholars and researchers.
The
study will enable banks to know the customer response to sales promotion. The
study will also help banks to the type of sales promotion strategy that will
attract customers to buy their product or service. The study will enable
customers to know the type of sales promotion available in the market and the
ones that will have an influence in their purchase behaviour. The study will
also help customers to make response on sales promotion. Also the study will be
significant to government as it will help them in policy making such as tax
administration among others. Finally, the study will educate the student of
this noble institution and other institutions on the response of customers to
sales promotion. The study will serve as a reference material to future
researchers.
1.8 Limitation
of the Study
The
study is geographically limited to Imo State, Nigeria. It is also interested
only in customers of commercial banks.
In
the analysis, frequency tables were only used for the descriptive statistics.
Multiple regression analysis was the only inferential statistics used.
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