THE IMPACT OF ADVERTISING AND SALES PROMOTION IN A SERVICE BASED ORGANIZATION (CASE STUDY OF MTN NIGERIA LTD)


THE IMPACT OF ADVERTISING AND SALES PROMOTION IN A SERVICE BASED ORGANIZATION (CASE STUDY OF MTN NIGERIA LTD)  

ABSTRACT

The major aim of this research work is to shed more light on the roles of advertising and sales promotion as a   marketing strategy and the importance of marketing as a tool in improving sales turnover in telecommunication industry using MTN as a case study. 

Any society mindful of economic strength ensures that production is completed; and for any production process to be completed, goods and services so produced are delivered effectively and efficiently to the acceptance and satisfaction of consumers, clients, subscribers and so on. How can this be achieved? 

It is practically of no use for a company to produce without selling their products or services, therefore in order to stimulate demand for their product, manufactures or producers must bring their products to the knowledge of consumers. One effective way of doing this is through advertising. Marketers can use the instrument of advertising to create (influence) demand. 

This is the question the Impact of Advertising and Sales Promotion on sales in any service delivery is sitting pretty on; providing and modernizing solutions among the Telecommunications in Nigeria is a great strategic planner in advertising and sales promotions which ranges from high creativity, technically, Branding, corporations, developments and promotions just for the singular purpose of attracting subscribers nationwide.

Demand for a product is created when a product is brought to a level of awareness such that consumers begin to recognize the product as being capable of meeting their needs. 

Advertising and sales promotion are mutually dependent on marketing; each complementing the other, while advertising spreads the word about a particular promotion, sales promotion on the other hand allows the consumers to exist the product; enforcing brand loyalty and sales forces. 

TABLE OF CONTENTS

Title page i

Certification page ii

Approval page iii

Dedication iv

Acknowledgement v

Abstract vi

Table of contents vii

CHAPTER ONE

1.0 Introduction 1

1.1 Background of study 1

1.2 Statement of product 3

1.3 Objective of Study 5

1.4 Research Questions 7

1.5 Research Hypothesis 8

1.6 Significance of Study 10

1.7 Scope of Study 12

1.8 Limitation of Study 13

1.9 Definition of Terms 15

1.10 Organizational Profile of MTN Nigeria Limited 17

References 34

CHAPTER TWO

2.0 Literature Review 35

2.1 Evolution of advertising and Sales Promotion 35

2.2 Meaning of Advertising and Sales Promotion 40

2.3 Types of Advertising 44

2.4 Functions of Advertising 47

2.5 Advantages and Disadvantages of Advertising and 

Sales Promotion 50

2.6 Objectives of Advertising and Sales promotion 62

2.7 Advertising process 67

2.8Methods of Evaluating advertising effectiveness 68

2.9 Evaluation of the impact of advertising/sales

Promotion in MTN Nigeria Limited 69

2.10 Advertising and sales promotion in relation to sales of 

service based organizations especially in 

telecommunication industries Budgets 71

2.11 Advertising Budget or appropriation 74

2.12 Factors that should be considered when setting 

Advertising Budgets 76

2.13 Need for Research in Advertising 77

2.14 Criticisms of Advertising and Sales Promotion Ethics 

in Nigeria 78

2.15 Future of Advertising and sales promotion 82

References 87

CHAPTER THREE

3.0 Research Methodology 88

3.1 Introduction 88

3.2 Research Design 88

3.3 Description of Study Population 90

3.4 Sources of Data 90

3.5 Sample Size Determination 92

3.6 Method of Data Presentation /Analysis 94

3.7 Test of Hypothesis 94

References 95

CHAPTER FOUR

4.0 Introduction 96

4.1 Data Presentation & Interpretation 96

4.2 Data Presentation 96

4.3 Testing of hypothesis 109

CHAPTER  FIVE

5.0 Summary of Findings, Recommendations & Conclusion 117

5.1 Summary of findings 117

5.2 Conclusion 119

5.3 Recommendation 120

Bibliography 123

Questionnaire 125

Appendix 126

CHAPTER ONE

1.0 Introduction

1.1 Background of the Study

Advertising and sales promotion are becoming very regular in our world today especially with the downturn in the economy and the consequent decimation of consumers purchasing power. In any production setting, it is believed that the production process is not complete until the goods and services get to the final consumers. Marketing as a concept involves the integration of advertising and sales promotion strategies which must be effectively carried out during and after the production of the products or services towards the effective and efficient satisfaction of consumer. Advertisements and commercials are available now in any media you turn to, on every newspaper, magazines, article, billboard adverts are everywhere especially in the urban places.  There is always one sales promotion or the other going on at any point in time.

Advertising has been defined by the Advertising Practitioners Council of Nigeria (APCON) as a form of communication through media, about products, services or ideas paid for by an identified sponsor.

The American Marketing Association and research professional defined Advertising as “any paid form of non –personal presentation and promotion of ideas, goods and services by an identified sponsor’.

From Communication perspective, advertising has been defined as “a form of paid mass communication intended to persuade prospects to prefer a brand or type of  certain goods, services or ideas to all others or others in the same category, and thus to move and induce them to patronize the goods or services or adopt the ideas”. The communication oriented definition has been further broken down for practical purposes by its author “saying the right things about the right product, service, or idea to the right people, in the right way, at the right time and place.

The time or space, used for the advertisement is paid for by the advertiser. This is what separates advertising from publicity.  A lot of people are exposed to the message at the same time, unlike in personal selling.  The message of the advertisement is about a product, idea or service.  The advertiser is always identified in an advertisement. This makes advertisement different from propaganda.

Sales promotion on the hand is any activity engaged in by a company to create a buying desire and an immediate reaction from customers, middlemen or company’s sales force. It comes in the form of raffle, giving out samples, and other branded items. It is aimed at creating a buying desire, rewarding loyal customers or attracting attention to product improvement.

Advertising and sales promotions are part of the marketing mix called promotion. They complement each other.  Advertisement spreads the word about a particular promotion. Sales promotion on the other hand allows the consumers to test the product, and thus the claims contained in the advertisement. It is used to enforce brand loyalty and reward loyal consumers and sales force.

1.2 Statement of Research Problems

A lot of money and time are being spent by companies and organization on and for advertising and sales promotion. It is on record that the Mobile Telecommunication Network, MTN for short, from its introduction into Nigeria at the dawn of the Millennium till date, has doled out huge hundreds of millions of naira solely for the purpose of advertising and sales promotion of their Telecommunication Networks.

Advertising agencies and strategies are growing by leaps and bound. MTN, through many advertising innovations, is standing firmer among all other Nigeria Telecommunication Network providers before the subscribers. Besides MTN field works for sales promotions, the network provider advertises and promotes its business through Media adverts, Sponsorship of entertainment industries like “football”, “Big Brother Africa shows”, “Who Wants to be a Millionaire”, “Development of Infrastructures in collaboration with the governments and even award of Scholarships.

Lo and behold, many companies and organization are with ineffective and inefficient advertising departments either deficient in funds, strategies or skills or both. It is a big concern that even customers and subscribers of rich advertising companies and organizations such as MTN, GLO, PHCN, UNICEF and so on complain that they are equally lacking in advertising strategies, skills and ideas. WHY?    How have these advertising deficiencies affected production, promotions, acceptability, marketability and general growth and successes of these companies and organizations? This is the statement of Research Problems aforementioned.

1.3     Objectives of the Study

A good number of research and investigation are consistently undertaken and hugely sponsored by MTN and even other companies and organization alike on the effectiveness of advertising and sales promotion strategies for the purpose of improving sales and services delivery.

MTN, through the outlet of their customer care service system (CCSS), persistently sample subscribers’ opinions, difficulties, ideas, complaints and suggestions for improved sales and services. This Telecommunication have equally employed the services of thousands for the singular purpose of field works through questionnaires and interactive sessions with customers and subscribers. With MTN’s “180 dialed” customers and subscribers are availed of an opportunity to speak directly with their providers.

Hence, the objectives of the study are worthy of enumeration as follows:

a) To ascertain the inherent effects of advertising and sales promotions on MTN’s customer and subscribers’ decision on patronage.

b) To examine the contributions of MTN’s advertising and sales promotion strategies in relation to other Network providers in Nigeria.

c) To discover the effects of advertising and sales promotions in the general growth and improvement of MTN’s market shares in the Tele communication world.

d) To determine potential effects of advertising and promotions deficiencies on MTN’s sales and service delivery to its customers and subscribers nationwide.

e) To uncover the consequences of employment and engagement of incompetent, inefficient and ill-skilled agents and workers in MTN’s advertising and sales promotion departments.

f) To ascertain the significance in the relationship between MTN’s advertising and sales promotion expenditures and sales/ service delivery turnover. 

1.4 Research Questions

In order to provide the required empirical data for the study, the following research questions shall be considered to validate recommendations.

1. How does advertisement and sales promotion strategies affect MTN’s customers’ and subscribers’ decision on patronage? 

2. What contribution does MTN advertising and Sales Promotion strategies in relation to other Network providers in Nigeria?

3. What effect does advertising and sales promotions have in the general growth and improvement of MTN’s market share in the Telecommunication world?

4. What potential effect does advertising and sales promotions have on MTN’s sales and service delivery to its customers and subscribers nationwide?

5. What are the consequences of employing and engaging incompetent, inefficient and ill-skilled agents and workers in MTN’s advertising and sales promotion department?

6. Is there any significance in the relationship between MTN’s advertising/sales promotion expenditure and sales/service delivery turnovers?

1.5 Research Hypotheses

The study will test the validity of the following hypothesis.

Hypothesis 1

Ho: Advertising and sales promotion strategies does not affect MTN’s customers and subscribers decision making on patronage. 

Hi: Advertising and sales promotion affects MTN’s customers and subscribers decision making on patronage.

Hypothesis 2 

Ho: Advertising and sales promotion strategies has no effect on the MTN’s market share in the Telecommunication world?

Hi: Advertising and sales promotion strategies has effect on the MTN’s market share in the Telecommunication world?

Hypothesis 3

Ho: There is a no significant relationship between MTN’s 

advertising/sales promotion expenditure and sales/service delivery turnovers?

Hi: There is a significant relationship between MTN’s 

advertising/sales promotion expenditure and sales/service delivery turnovers?

Hypothesis 4

Ho: There are no consequences in employing and engaging 

incompetent, inefficient and ill-skilled agents and workers in MTN’s advertising and sales promotion department?

Hi: They are consequences in employing and engaging 

incompetent, inefficient and ill-skilled agents and workers in MTN’s advertising and sales promotion department?

1.6 Significance of the Study

The significance of the study is founded on how MTN Nigeria limited can strengthen its adverting and sales promotion strategies to widen and improve on its production, promotion, acceptability, marketing,  general growth and successes in the currently highly competitive Telecommunication industry in Nigeria with GLO, ETISALAT, ZAIN, RETEL and others in the battle to win customers and subscribers.

The importance of this study is equally rooted in how best to improve on MTN’S employment and engagement of competent, skilled and expert agents and workers in their increasing advertising and sales promotion departments for the purpose of utmost sales and service delivery to its millions of customers and subscribers in Nigeria, its growth and sustenance of its successes.

The findings of this research will be of assistance to MTN’S body of advertising agents to discover virgin strategies and unexploited and untapped areas for stronger and more effective advertising and sales promotions for the promotion of healthy completion among Telecommunication tariff, highest service provision, widest interconnect ability with other Network providers and so on.

In summary, MTN Nigeria Limited, through the strongest Network provides nationwide, will and must boost the advertising and sales promotion strategies and personnel if it must maintain its position in Telecommunication in Nigeria

Advertising and sales promotion is fast becoming a part of everyday life. As the world is compressed into a global village, we depend more and more on the mass media and other communication gadgets.  Except for those in very remote villages, no day passes without one being exposed to at least one form of advertising or the other. Many organizations in the telecommunication industry are desperately struggling to beat competitors off and build competitive edge over other competitors in order to maintain their status quo. They have thus, engaged in different marketing strategies ranging from pricing to segmentation, distribution, promotion, product, planning and development etc.

The significance of this study is therefore to help telecommunication industries determine the relevance advertising and marketing strategies in enhancing the sales turnover level of their product/services.  This study will equally provide information about the effectiveness or otherwise of advertising and sales promotion as a marketing tool for stimulating purchase of products particularly in telecommunication industry, it will also help to promote healthy competitors among marketers/service organizations thereby promoting the development of the nation’s economy.

The findings of this research will help advertising practitioners create more effective advertisements and campaigns by letting them know the customer’s perception of a good advertisement.

Finally, this work will throw up means for further research.

1.7 Scope of the Study

The work basically evaluates the effect of advertising and sales promotion in improving sales in the telecommunication industry with particular interest in MTN Nigeria Limited.

Since it is impossible to visit every organization in the telecommunication industry, the scope of the study will be limited to MTN Nigeria Limited, and all suggestions and recommendations will be advisably relevant to the industry in relation to the topic of the research.

1.8 Limitation of study

The extent to which the project would have taken is hindered by some factors which include:-

Time:  

There was inadequate time to carry out the research work, considering the short semesters; much of the time was devoted to lectures, class quiz and preparation for final semester examination.

Materials:  

As a result of high cost of textbooks and other relevant materials all reference material needed for the purpose of the project could not be gotten. There was no much time to spend in the library, as a result, I made do with the few textbooks, journals, articles, I could lay my hands on and also materials from the international network (internet)

Respondents:  

The reluctance of the respondents to cooperate in giving their view on the topic especially in the area of filling the questionnaire on time also constituted a limitation. Again some of the questionnaires were filled improperly while some complained that they have no time to fill questionnaires.

Fund:  

Due to insufficient fund on my part, I could not cover much desired areas.  I ordinarily would have covered for this research.  As a matter of fact, I was supposed to travel to Abuja the second time for more information but I couldn’t due to money constraint.

Dearth of information:  

Most telecommunication/service based organizations have series gap between the level of information obtained and the knowledge of their consumer behavior so as to boost sales and increase productivity.

1.9 Definition of Terms

Advert:

This refers to the action of calling people to the attention of some paid announcements.

Advertisement:  

According to |Pride and Ferrel (1985), defines it as a paid form of non personal communication about an organization and/or its products that is transmitted to a target audience through mass medium.

Advertising:  

According to Nwosu and Nkamnebe (2006) it is defined as “a persuasively crafted marketing communication transmitted through the media”.

Chris Doghudje sees advertising as;

Any public notice, the aim of which is to sell or win patronage for goods, services, ideas or institutions. 

Marketing strategy:  

It comprises broad principles which marketing managers use to achieve its business and marketing objectives in target market ( Kotler).  

Product/ services:  

It can be defined as the totality of what the seller intends to sell and what the buyer intends to buy.

Customer:  

Include individual consumers, groups of individual households and organizational buyers whose needs the marketers struggles to satisfy at all time profitability.

Share of customers:  

This is simply the portion of the customers purchasing that a company gets in its product categories.

Prospects:  

These are the potential buyers or the right consumer of a particular product.

Marketing element:  

These are the set of controllable tactical marketing tools which firms blends to produce the response it wants in the target market.

Target market:  

This is a process whereby a company concentrates its marketing activities to satisfying a particular area.

Profitability:  This is to ratio of profits to the capital that had to be invested to generate these profits.

1.10 HISTORICAL BACKGROUND OF MTN NIGERIA LIMITED

MTN Nigeria Communication Limited is part of the Mobil Telecommunication Network (MTN) Group of Africa’s leading cellular telecommunications company. It was incorporated in Nigeria on November 8, 2000 as a private company; it secured a license to operate digital (Global System for Mobile Telecommunication GSM) telephony on February 9, 2001 from the Nigerian Communication Commission. It should be noted that the company paid the sum of N855 million as take off license fees from NITEL, following a bidding method advanced by the Federal Government.

Also on May 16, 2001, MTN became the first G.S.M. network to make a call on its GSM network in the new dimension, following the globally lauded Nigerian GSM auction conducted by the Nigerian Communications Commission earlier in the year.  Thereafter the company launched full commercial operation beginning with Lagos, Abuja and Port Harcourt.

To date, in excess of US$1.8 billion has been invested building mobile telecommunications infrastructure in Nigeria.  Since launched in August 2001, MTN has steadily deployed its services across Nigeria. It now provides services in 223 cities and towns, more than 10,000 villages and communities and a growing number of highways across the country, spanning the 36 states of the Nigeria and the Federal Capital Territory, Abuja.  Many of these villages and communities are being connected to the world of telecommunications for the first time ever.

The company’s digital microwave transmission backbone, the 3,400 kilometers Y’ellow Bahu was commissioned by President Olusegun Obasanjo in January 2003 and is reputed to be the most extensive digital microwave transmission infrastructure in all of Africa. The Y’ellow Bahn has significantly helped to enhance call quality on MTN network.

MTN Nigeria also recently expanded its network capacity to include a new numbering range with the prefix ‘0806’ and ‘081’ making MTN the first GSM network in Nigeria to have adopted an additional numbering system, having exhausted its initial subscriber numbering range – 0803.

In its resolve to enhance quality customer service, MTN Nigeria has also introduced a self help toll free 181 customer care line through which subscribers can resolve their frequently asked questions free of charge.

MTN’s overriding mission is to be a catalyst for Nigeria’s economic growth and development, helping to unleash Nigeria’s strong developmental potential not only through the provision of world class communication but also through innovative and sustainable corporate social responsibility initiatives.

1.10.1 MTN NIGERIA LIMTED NATIONAL COVERAGE

MTN Group Vision

MTN’s vision is to be the emerging markets’ leading telecommunications provider.  The company’s strategy is built on three pillars, ‘consolidation and diversification ‘Leveraging our footprint and intellectual capacity’ and ‘convergence and operational evolution.

1.10.2 MTN Group Strategy

“MTN has adopted a two-fold expansion strategy of leveraging existing business and growing into new markets”.

 MTN Group Strategy: An Overview

The MTN Group believes that information and communication technologies (ICT) are an indispensable catalyst for economic development, one that affords developing countries the opportunity to lead frog many stages of modernization from a technological perspective.

The Group’s aim to achieve excellence in each operation and in corporate citizenship presents many challenges. Each of their business faces differing economic, social and regulatory requirements. Each faces competition and rapid technological advances that prescribe tailored responses.  Nonetheless, at a group level, MTN key strategies are clear, and they include:-

⦁ MTN Company will focus on increasing communications network capacity where needed, and not merely increasing geographic coverage.

⦁ MTN Company will concentrate on increasing customer loyalty, and stimulating usage through innovative services.

⦁ MTN Company will continue to play an important role in bridging the digital divide, providing telecommunications services in emerging markets.

⦁ MTN Company will continue to invest in emerging markets, developing new growth engines to fuel the next phase of its development and diversifying its revenue sources.

⦁ MTN Company will continue to support African continental and emerging market development initiatives.

⦁ MTN Company will continue to embrace the philosophies of corporate citizenship and sustainable development in all its operations.

1.10.3 ORGANISATIONAL PROFILE (MTN)

The MTN Group Limited is a leading provider of communication services, offering cellular network access and business solutions, and listed in South Africa on the Johannesburg Securities Exchange (JSE) under the Industrial-Telecommunication sector.

Launched in 1994, MTN Group is a multinational telecommunications provider, with as core operation in 21 countries in Africa and the Middle East, and as at the end of December 2008, had more than 90.7 million recorded subscribers.

1.10.4 AWARD RECEIVED BY MTN NIGERIA LIMITED FROM 2007 TILL DATE IN NIGERIA

2007 MTN Nigeria

⦁ Best Corporate Tax Pay in the communications industry for the year 2005-2006

⦁ Titans of Tech award as GSM Company of the year awarded by ICT Africa.

⦁ Distinguished Corporate Award for contributions to the development and promotion of the human resource profession in Nigeria, awarded by the Chartered Institute of Personnel Management

⦁ GSM Company of the Year Award at the Lagos Enterprise Awards.

⦁ Best Health Merit Award, awarded by the Lagos State government.

1.10.5 MTN NIGERIA LIMITED ORGANIZATIONAL STRENGTH

The MTN Group is a multinational operating in a wide range of countries and cultures. The group has, as its core, five shared values which address the company business principles, conduct and interaction with all the company’s stakeholders. These are stated below.

LEADERSHIP

Ingredients – Foresight, commitment, Guidance

⦁ Building a future for our people and the customers we serve

⦁ Leading the way trough connectivity enablement

INTEGRITY

Ingredients – Solid Principles, Trusted, Togetherness

⦁ We are, because of you, our customers

⦁ We are, because of you, our employee

⦁ With your trust and belief, we will always succeed.

CAN DO

Ingredients – Optimum, future focus, Passionate, Happening

⦁ Creating brighter futures, for everyone whose life we touch

⦁ Empowering people communities  and countries

⦁ Creating possibility.

INNOVATION

Ingredients – Simplicity, Imagination, Insight, creativity

⦁ Doing things differently

⦁ Making unlikely connections

⦁ The unexpected exceeds expectations

RELATIONSHIPS

Ingredients – Teamwork, Friendly, personal, warm and caring

⦁ Connecting with people on “their level”

⦁ Having empathy for their unique situations

⦁ Building relationships with our customers (internal and external)

⦁ Source:  ⦁ www.mtnonlinOe,com

1.1.5 MTN ORGANIZATIONAL CHART/ORGANOGRAM 

MD/CEO

Public relations  manager

Sales manager

Advertising manager

Customer service manager

Marketing general manager 

Technical general manager

Admin general manager

personal general manager

Finance general manager

Fig 2.1 Source: www.mtnonline,com

1.10.6 MTN GROWTH PHILOSOPHY

MTN has adopted a two-fold expansion strategy of leveraging existing business while growing into new markets.  

The strategy has proven to be sound and has enabled them to meet their objective of developing telecommunications in emerging market and realizing a good Return On Investment (ROI).

The strategy is characterized by the following:-

⦁ Pursuit of new markets

MTN Group is routinely evaluating new license bids but also license acquisition opportunities in emerging markets.

⦁ Making small/uneconomic licenses attractive

MTN has adopted a regional approach aimed at consolidation and creating economies of scale.

⦁ Leveraging common infrastructure to exploit new opportunities.

Fixed line services, data and internet Satellite, Application Transmission Capacity, VPN.

⦁ Focus on R&D and innovation to create new services

MTN has created an incubator environment within its quest for innovative offerings. The Group’s success in this regard, is manifested in developing new applications, e.g. mobile payments and utilizing Voice over Internet Protocol (VoiP).

⦁ Platform for continued Growth

Sound investment criteria when rolling out into new markets has been a key discipline that has helped them maintain a good balance between operational objectives and shareholders return.

Making a significant and real contribution to the economies of the territories in which they operate is a priority for MTN and is an important component of our vision to be a leading provider of telecommunications in emerging markets. In line with this, up to December 2005, their investment in cellular infrastructure in our operating territories had already exceeded R30 billion, a significant contribution also to the New Partnership for Africa’s Development (NEPAD) goals for ICT development for the continent.

1.10.7 MTN NIGERIA LIMITED ANNUAL REPORT (2008 & 2009 RESPECTIVELY)

MTN Nigeria

ARPU ($) Subscribers(’000)

Net additions

Image Image

Launched August 2001, market share 49,6%, population 146,6 million, forecast market size in 2014 – 110,7 million, legal shareholding 76%.

MTN Nigeria revenue and expenses summary

  12 months to 12 months to  

  December 2009 December 2008 %  

  Rm Rm change  

  Airtime and subscription revenue 27 534 25 557 8  

  Interconnect revenue 4 045 4 291 (6)  

  Data and SMS 1 321 1 110 19  

  Connection revenue 116 236 (51)  

  Other 309 363 (15)  

  Total revenue 33 326 31 558 6  

  Direct network operating costs 3 240 3 418 (5)  

  Costs of handsets, SIMs and vouchers 785 590 33  

  Interconnect and roaming costs 2 793 2 847 (2)  

  Employee benefits and consulting costs 1 034 1 048 (1)  

  Selling, distribution and marketing costs 3 250 2 976 9  

  Other expenses (general and administration) 2 477 2 431 2  

  Total operating expenses 13 579 13 310 2  

  EBITDA 19 746 18 248 8  

  EBITDA margin 59,3% 57,8% 1,4 pts  

Overview

MTN Nigeria’s continued heavy investment in infrastructure to enhance the quality and capacity of its network, together with a more streamlined sales and distribution channel, helped boost subscriber numbers in Africa’s most populous country by a third in 2009, and lift MTN Nigeria’s market share to almost half.

The strength of the MTN brand, the broad appeal and innovative nature of its segmented value propositions and effective usage boosting promotions also assisted in ensuring that MTN Nigeria achieved more than three-quarters of the net additions in the market to end the year with 30,83 million customers and a GSM market share of 49,6%. To accommodate these new subscribers, MTN Nigeria rolled out its new 0813 number range.

Total mobile market penetration grew to 42, 4% from just 15% five years ago.

Although local currency revenue increased by 30% for the period, in line with subscriber growth, this translated into a much lower 5,6% growth in rand terms to R33,3 billion, due to the rand strength in the second half of the year compounding naira weakness in the first. In line with increased penetration into lower-usage segments and pressure on consumer spending, average revenue per user declined marginally in local currency, by 9,6% for the year. Weakness in the naira currency exacerbated the fall in dollar terms, with ARPU of USD12 for 2009 down from USD16 in 2008.

MTN Nigeria’s EBITDA grew 8% in rand terms and 32% in naira terms. The EBITDA margin improved by 1,4 percentage points to 59,3% mainly due to an increase in revenue and the benefits of scale together with a containment of operating expenses, in particular an 18% decline in the price of fuel.

Nigeria remained the top destination for MTN Group capital expenditure in 2009, accounting for some R10,2 billion. Investments were made to modernize the network and improve its capacity and coverage, with a major emphasis on strengthening the Company’s wireless data offering.

REFERENCES

Kotler P. and Armstrong  G. (2004), Principles of Marketing, thirteenth edition, Pearson Education, Inc, India.

Osuagwu, L.C. (2002):  Marketing Principles and Management, Second edition, Grey Resources Limited, Surulere, Lagos.

Udegbe, M.I. and Udegbe S.E (2004):  Introduction to Sales Management, first edition, Jelly Amin & Sons Enterprises, Mushin, Lagos.

Nwosu, I.E. (2008) “Strengthening and Expanding   Advertising Regulatory and Control Mechanism in Nigeria: Adopting an Intra-Professional and Consumerist Approach with Lessons from the American Situation

www.mtn,com

.

THE IMPACT OF ADVERTISING AND SALES PROMOTION IN A SERVICE BASED ORGANIZATION (CASE STUDY OF MTN NIGERIA LTD)



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