ADVERTISING AND MARKETING PERFORMANCE OF GSM COMPANIES IN PORT HARCOURT METROPOLIS
CHAPTER 1
INTRODUCTION
1.1 Background of the Study
Every organization must recognize that the success of any manufactured product or service rendered depends on its level of acceptance in the market. The ever increasing product diversity and competition on the market of goods and services has dictated the pace of growth in the number of advertisements. Despite their admittedly diminished effectiveness over the recent years, advertisements remain the favoured method of sales promotion.
To endear a product to the consumer, many organizations employ different effective marketing tools and promotional strategies to enhance product acceptance. For a product to be accepted by the public therefore, the marketing mix must be available – product, price, place and promotion. This means that for a product to be successful, it needs the right price, the correct strategies and the right promotional activities. Alide (2002) sees advertising as a concept which can be defined as a form of communication through the media about product, services, ideas, personalities or organizations, paid for by an identified sponsor. Bovee and Arens (2005) gave a more widely accepted definition of advertising as the non-personal communication of information, usually paid for any usually persuasive in nature about products (goods and services) or ideas by an identified sponsor through various media. It is an exciting, dynamic, and challenging enterprise. Its often a persuasive communication in that it tries to persuade the reader, the listener or the viewer to take to the sponsor’s own point of view and also to take some appropriate action. It is not personal or face to face communication, rather it is directed to a group of people.
Advertising is also controlled, identifiable information and persuasion by means of mass communication media. Defined by Wrignt and Zeight (2002). Gillran Dyer says that in its simplest sense, the word “advertising” means drawing attention to something or notifying or informing somebody of something. On the other hand, GSM stands for Global System for Mobile Communications. In Nigeria, GSM means Telecom explosion. The GSM revolution began in August 2001 and changed the face of Information and Communications Technology in Nigeria. Since the GSM launch, mobile telephony has rapidly become the most popular method of voice communication in Nigeria. Growth has been so rapid that Nigeria has been rightly described in various for a as ‘one of the fastest growing GSM markets in the world”.
Indeed these developments have been truly explosive: according to statistics from the Nigerian Communications Commission (NCC), compared with just about 450,000 working lines from NITEL in 2001, by August 2004, the GSM operators had recorded over seven million subscribers. Expectations are that the figure should rise to nine million by the end of 2004, due to massive expansion programmes launched by the operators. As a result of this various Handset or mobile phones are now available in the country with different size, face, colour, facilities and cost.
One of the tools that are available to manufacturers to crate awareness as well as create product image in the minds of buyers and potential users is advertising. The influence of advertising in the action consumer takes concerning a particular product lies in the frequency of exposure to the message and the usefulness of the product to the indentified needs of the would-be users. Generally speaking, the role of advertising is to inform both loyal and potential consumers of the benefit, function, and/or the price of the product; to persuade consumers to buy the said product; and to remind those who are already using the product of the existence of the product in the market. Writing on the information function of advertising, Daiwan (2009) agrees that the primary role of advertising is ‘to inform potential buyers of the problem-solving utility of a firm’s market offering, with the objective of developing consumer preferences for a particular product’.
The concept of consumer preference comes even alive in the Nigerian telecommunications industry which has been described has the “largest and fastest growing in Africa and among the 10 fastest growing telecom markets in the world” (Nwachukwu, 2013).B Analysis of the sector showed that operators of the global system for mobile telecommunication (GSM) sector have a huge overall control of the telecoms market, 118,470,236 active connections were recorded as at the end of September 2013 from 113, 195, 95 as at December 2012. The MTN Nigeria, Glo Mobile (Globacom), Etisalat Wireless and Airtel Nigeria in that other rule the market. With this scenario, it is clear that the various network providers would strive to outdo one another by attempting to position their services ahead of others so as to become the biggest network with the largest subscribers. According to Kotler (2001), promotion is designed to stimulate the market, the trade, and the organization’s own sales force. To this end, the research intended to x-ray the impact of advertising on the marketing Performance of GSM companies in Port Harcourt.
1.2 Statement of the Problem
In any competitive marking environment such as ours, a marketing department/ term is often faced with the problems of how to determine the measure of demand for its products in a given market segment, how to determine the factors responsible for the variations in the demand pattern.
Many GSM service providers are faced with the problem of not only identifying suitable strategies to bet their competitors but also how to determine the strength of the contributions of various components of the promotional mix variables especially advertisement to achieve the purpose of stimulating demand of their product brand. This has equally led to high budgetary allocation by the GSM service providers as they understand that Nigerians are among the top users of mobile phone based on the population. However, the study is to appraise the impact of advertising and Marketing performance of GSM companies in Port Harcourt.
1.3 Purpose of the Study
The study seeks to examine the advertising and Marketing performance of GSM companies in Port Harcourt. The specific objectives are as follows:
1. To examine the association between Media and Marketing performance of GSM companies in Port Harcourt.
2. To examine the association between Word of Mouth and Marketing performance of GSM companies in Port Harcourt
1.4 Research Questions
Here, certain questions are raised; the provision of answers to them will be controlling the idea of the research work. The questions pertain the crux of the matter and are statements of major problems to be encountered as the progress is made on the work. The questions, which are interdependent, include the following ones:
To what extent does Advertising Media affect marketing performance of GSM companies in Port Harcourt?
2. To what extent does word of Mouth affects marketing performance of GSM companies in Port Harcourt?
1.5 CONCEPTUAL FRAMEWORK OF ADVERTISING AND MARKETING PERFORMANCE OF GSM COMPANIES IN PORT HARCOURT
Sales Growth (SG)
MARKETING PERFORMANCE
ADVERTISING
Media
Market Share (MS)
World of mouth
SOURCE:(Researcher’s Desk 2015).
1.6 Research Hypotheses
As contained in the statement of objectives, it is logical to identify some relationship between different variables that now form the bases of hypotheses of the study. In order to carry out this research, the following hypothesis would be postulated:
Ho1: There is no significant association between Advertising media and Sales Growth in GSM companies in Port Harcourt.
Ho2: There is no significant association between Word of Mouth and Market share in GSM companies in Port Harcourt
Ho3: There is no significant association between Advertising media and market share in GSM companies in Port Harcourt.
Ho4: There is no significant association between Word of mouth and Sales Growth in GSM companies in Port Harcourt
1.7 Significance of the Study
This study will be of benefits and interest not only to Accounting Firms in Nigeria, but it will be valuable to other service sectors in Nigeria as a whole.
Advertisers: The study will be of importance to advertisers on the need to improve sales through the use of advertisement technique.
Media: Mass media outfit will also benefit from the study to know what the public is expected when advertising a product or service
GSM Producers: It is anticipated that results from this study will help to evaluate and identify better ways of making GSM advertising and business operations more effective.
General Public: At the end of this research, the public should be able to identify good advertisement from one that is aim at deceiving them.
1.8 Scope of Study
The general scope of this study covers Advertising and Marketing performance. The geographical scope is Rivers State of Nigeria. The study will be carried out to examine (MTN, Etisalat, Airtel and Globacom
1.9 Limitations
The drawbacks in the course of carrying out this study, that could. limit the general applicability of the research, these hindrances includes fund, time and other human material resources.
Material: At the time of gathering materials for this study there was relatively little material.
Finance: There is no much found to travel to and browse online for necessary materials
Time: Available time for this study is relatively short compare to the task while other academic activities also coincide to with the period of the project.
1.10 Definition of the Terms
Advertising: This is any paid form of non-personal presentation and promotion of ideas, goods or services, by an identified sponsor, Adirika, Ebue, Nnolim (2006:107).
Marketing: This can simply be referred to as the efforts by a company to design and disseminate information about it’s terms and the benefits to the target market, using different medium. Adirika, Ebue, Nnolim (2006:87).
GSM: Global System for Mobile or mobile phone.
CHAPTER FIVE
SUMMARY CONCLUSION AND RECOMMENDATION
The objectives of this study were to
1. To examine the association between Media and Marketing performance of GSM companies in Port Harcourt.
2. To examine the association between Word of Mouth and Marketing performance of GSM companies in Port Harcourt
Findings from the study revealed the following
1. Media is the communication channel through which GSM companies can advertise their product.
2. Media helps the customers of GSM companies to know when they have a new product.
3. Customers would be happy to recommend any GSM company that cares for their service needs.
4. Sales growth is the process of business expansion by increased output, customer base expansion or a new product development.
5. Sales growth shows how well a business improved over a given time.
6. Market share refers to company’s portion of sales within the entire market in which it operates.
7. Market share indicates a company’s size within its market.
8. There is a significant positive association between advertising media and sales growth in GSM companies in Port Harcourt.
9. There is a significant positive association between word of mouth and market share in GSM companies in Port Harcourt.
10. There is a significant positive association between advertising media and market share in GSM companies in Port Harcourt.
11. There is a significant positive association between word of mouth and sales growth in GSM companies in Port Harcourt.
CONCLUSION
Advertising is a persuasive communication which attempted to change or reinforce one’s prior attitude and it is basically done not only to inform customers about products, rather it is a process which further influences and persuades customers to purchase. This study sought to establish the extent to which advertising affect the sales growth and market share of GSM companies in Port Harcourt. Hypothesis one test of the study revealed a statistically significant and positive association between advertising media and sales growth of GSM companies in Nigeria. It could be concluded that the amount of money committed into advertising budgets of the firms resulted into increased sales revenues for the GSM companies. The amount of resources committed to advertising was sufficient enough to stimulate increased sales revenues of the firms over the period. On the other hand, the finding could also imply that there is also a statistical positive relationship between word of mouth and market share of GSM companies. The third hypothesis test indicated that there is a significant relationship between advertising media and market share of GSM companies. The finding could imply that since the use of advertising media has helped to improve the market share of GSM companies, it might likely affect or increase the profitability of the firms, hence the observed significance of the profitability of the firms. The study was based on the primary data collected from GSM companies in Port Harcourt Nigeria. The companies were selected based on the observation made by (Kingsley, 2012). Also the selection of the firms was made on the bases of filtering the companies with data availability covering the period of this study.
RECOMMENDATION
Based on the findings and the conclusion reached in this study, the following recommendations were made:
i. The management should emphasize on advertising as an important and strategic policy aimed at increasing sales revenues and market share of the firms while formulating creative advertising entrepreneurial marketing strategies relating to sales revenue and profitability promotion policy. This could be achieved through the commitment of more financial resources and the enhancement of advertisement budgets from time to time in tandem with economic realities.
ii. We recommended that there is the cogent need for the management to review their existing advertising policy on their products so that multiple approaches could be used in a cost effective manner to reach out to target consumers and by implication increase sales revenues for the firms.
iii. Other factors which are crucial to increase sales revenue and profitability such as sales promotion, personal selling and publicity etc. which are important should be considered while formulating promotion policy for the firms.
iv. Finally, management should use the right medium of advertising so that the message would reach the target consumers with the right products. By doing so, a large number of consumers would be reached. This could help to increase the patronage of the buyers leading to improving the sales revenue of the companies in Nigeria
.