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Abstract
The study was determined to examine the effect of sales promotion on customer loyalty for Dangote products in Rivers State. The survey design was employed since the study was to examine the effect of sales promotion on customer loyalty. The study was designed to focus on Dangote products in Rivers State where primary data, via questionnaire were collected. The population of this study constitutes management and staff of all senior and junior staff of Dangote company in Rivers State which was unknown. The judgmental sampling technique which is a non-probability sampling technique was used for selecting the sample. The sample size of this study is judgmental sample of 25 respondents which comprise of both the senior and junior staff of Dangote company, Port Harcourt. In this study both the primary and secondary data were used. A self-designed questionnaire on the impact of sales promotion on customer loyalty was used and administered for the collection of data from the respondents. The data collected were processed electronically using Statistical Packages for Social Sciences (SPSS). The statistical test used in the analysis of the data collected was the Chi-Square statistical tool. In this context, all the questions were considered and analyzed. Findings reveal amongst others reveal that there is a significant relationship between refunds and rebates and customer loyalty. Based on the finding of the study we recommended that management should establish the sales promotion objectives, selecting the appropriate tools or techniques, developing the program, and evaluating the consumer response or influence, also current spending must be analysed and categorized by the type of activities such as display, contrast, packages, insert, fair exhaustion and others, that advertising be used effectively to communicate with their customers through the television advertisement because it create an everlasting memory on the particular product been advertise and the firms should also create an affordable cost of sales to enable the customers patronise their product.
Table of Contents
Title Page i
Cover Page ii
Declaration iii
Certification iv
Dedication v
Acknowledgements vi
Abstract viii
Table of Contents ix
CHAPTER ONE 1
INTRODUCTION 1
1.1Background of the Study 1
1.2 Statement of the Problem 3
1.3 Objectives of the Study 4
1.4 Research Question 5
1.5 Research Hypotheses 5
1.6 Significance of the Study 5
1.7 Scope of the Study 6
1.8 Limitation of the Study 7
1.9 Definition of Terms 8
CHAPTER TWO 9
REVIEW OF RELATED LITERATURE 9
2.1 Introduction 9
2.2 Conceptual Framework 9
2.2.1 Concept of Sales Promotion 10
2.2.2 Dimensions of Sales Promotion 17
2.2.3 Concept of Customer Loyalty 19
2.2.4 Measures of Customer Loyalty 22
2.2.5 Sales Promotion and Customer Loyalty 25
2.3 Theoretical Framework 26
2.4 Review of Related Empirical Studies 28
2.5 SUMMARY OF LITERATURE REVIEW 30
CHAPTER 3 31
RESEARCH METHODOLOGY 31
3.1 Introduction 31
3.2 Research Design 31
3.3 Population of the Study 31
3.4 Sampling Techniques Used 32
3.5 Sample Size 32
3.6 Source of Data 32
3.6.1 Primary Source (s) of Data 32
3.7 Research Instrument for Data Collection 33
3.8 Validity and Reliability of Instrument 33
3.9 Techniques for Data Analysis 34
CHAPTER FOUR 35
DATA PRESENTATION AND ANALYSIS 35
4.1 Introduction 35
4.2 Presentation of Question/Items in the Questionnaire and Analysis of Responses 35
4.3 Testing of Hypothesis 39
4.4 Discussion of Findings 44
CHAPTER FIVE 47
SUMMARY, CONCLUSION AND RECOMMENDATION 47
5.1 Introduction 47
5.2 Summary 47
5.3 Conclusion 48
5.4 Recommendations 49
Appendix I 53
Appendix II 54
CHAPTER ONE
INTRODUCTION
1.1Background of the Study
Sales promotion has become an effective marketing tool that assists organization to wax stronger in a global competitive environment.
Oyedapo, (2012) identified sales promotion as a key ingredient in marketing campaigns which assist organization achieve its objectives, the main aim of any organization is to maximize profit and have largest market shares and to become leader in a competitive market environment.
Okoli (2011) confirmed that the essence of setting up a business organization is to make profit. Sales promotion simply exists to have a direct impact on the behaviour of the firm’s customers. (Blatt Bery and Nelsin 1990).
Aworemi (2008) in his research finding said that sales promotion plays a significant role on sales volume which helps in achieving the organizational objectives. The role of sales promotion in achieving organization stated objective cannot be underestimated, the purpose of sales promotion is to motivate the customers to immediately purchase a particular product that enhancing its sales volume (Sadia and Syeda, 2012; Odunlami and Ogunsiji, 2011; and Aderemi; 2003).
According to Shimp (2003), sales promotion refers to any incentive used by a manufacturer to induce the trade (wholesalers, retailers, or other channel members) and other consumers to buy a brand and to encourage the sales force to aggressively sell it. Kotler (2003) sees sales promotion as a key ingredient in marketing campaigns and consists of a diverse collection to incentive tools, mostly short term designed to stimulate quicker or greater purchase particular product or services by consumer. Sales promotions programmes are those activities other than stimulate consumer purchase. Sales promotion is an important component of an organization overall marketing strategy along with advertising, public relation and personal selling. Sales promotion acts as a competitive weapon by providing an extra incentive for the target audience to purchase or support one brand over another (Odunlami and Ogunsiji, 2011).
Product is the most important element of the marketing mix. The aim of the product is to satisfy the needs and desire of the customers. The basic idea behind the existence of any product is the satisfaction of needs and wants. (Kolter, 1998).
A product is anything that can be offered to a market for attention, acquisitions, use of consumption of product.
According to him, what people desire is not the product, but satisfying expenses. This view was confirmed by Levith (1989) who argues that a product needs to be seen in terms of benefit they provide rather than function they perform.
Worlu (1999) “sales promotion is essentially an exercise that has to do a lot with information, persuasion and influence” Kolter P. (1980) “the essential purpose of sales promotion is to change the location and shapes of the demand, which creates more revenue for a company’s product. In economy theory, the use of sales promotion increases a products sales volume at a given price. It is also hoped that sales promotion will affect demand elastically for the product making the demand elasticity in the face of price increase and elastic when price decreases. From the foregoing therefore, the study is determined to examine the effect of sales promotion on customer loyalty for dangote products in Rivers State.
1.2 Statement of the Problem
Until recently, many supermarket operations pay little or no attention to promotional activities it was considered as a meaningful business activity and not economical. Those business managers believed that sales promotion was not necessary rather distribution was considered the most prominent.
In business communication sales promotional effect accounts for their poor sales margin and consequently leads to their low return on investment. Most sales literature indicates that poor sales promotional adaptation by firm leads to their high level of underemployment of resources as their markets are satisfactory served and further opportunities are rarely sought, yet the prevailing threats in the business environment could not overcome since the lack of sales promotion makes marketing management not to be able to determine the demand preference, perception, taste in fashion of the market.
This condition invariably leads to inefficient sales promotion vise-a-visa inefficient consumption, and poor utilization of resources.
1.3 Objectives of the Study
The main objective of this study is to examine the effect of sales promotion on customer loyalty for Dangote products in Rivers State. The specific objectives are as follows:
- To examine the extent to which bonus offer influence customer loyalty for Dangote products in Rivers State.
- To examine the extent to which coupons influence customer loyalty for Dangote products in Rivers State.
- To examine the extent to which refunds and rebates influence customer loyalty for Dangote products in Rivers State.
- To examine the extent to which trade fair and exhibition influence customer loyalty for Dangote products in Rivers State.
1.4 Research Question
The following research questions were proposed to guide the study.
- To what extent does bonus offer influence customer loyalty for Dangote products in Rivers State.
- To what extent does coupons influence customer loyalty for Dangote products in Rivers State.
- To what extent does refunds and rebates influence customer loyalty for Dangote products in Rivers State.
- To what extent does trade fair and exhibition influence customer loyalty for Dangote products in Rivers State.
1.5 Research Hypotheses
The following hypotheses were formulated to guide the study:
HO1:There is no significant relationship between bonus offer and customer loyalty.
HO2:There is no significant relationship between coupons and customer loyalty.
HO3:There is no significant relationship between refunds and rebates and customer loyalty.
HO4:There is no significant relationship between trade fair/exhibition and customer loyalty.
1.6 Significance of the Study
This research work will help the firm to improve the marketing performance of small and mediums scale business firms as well as individual in assessing the impact of sales promotion on the market share of the firm.
The research findings would also help policy makers and management consultant to adopt adequate strategies of sales promotion on the marketing performance of small scale business firm.
It will help small scale business firms to appreciate the importance of sales promotion to the market share of the firm. The study will guide the good small scale business firms to identify promotional strategies in order to increase the market share of the firm.
Finally, the work would highlight the influence of sales promotion in marketing performance of small scale business firm to other business firm who do not give attention to sales promotion.
1.7 Scope of the Study
The study is delimited under the following heading: content scope, geographical scope and unit of analysis.
Content Scope: The content scope of this study involves an investigation to ascertain the relationship between sales promotion and customer loyalty. The dependent variable is customer loyalty, measured by attitudinal loyalty and behavioral responses. While independent variable is sales promotion measured by bonus offer, coupons, refunds and rebates and fair/exhibition.
Geographical Scope: The geographical scope of the study is Dangote products in Rivers State.
Unit of Analysis: The unit of analysis in this research involves both senior and Junior staff of Dangote Groups at the time of carrying out the study.
1.8 Limitation of the Study
The interest of this study is to highlight the relevance impact of sales promotion and market share of the firm. It is also aims at producing a glance, the influence of sales promotion in marketing. However, the geographical area covered by the study was Rivers State.
Through the research experience some difficulties in caring out this research due to time constraints, financial constraints which also impede on the availability of data to carry on this research work.
This is so because every human has its inherent weakness and strengths. As a result, this study own boundary of limitation finance, time, and lacks of adequate corporation from the respondents and logistics where some of the problems the research faced in the cause of is study. Consequently, it is obvious that the research has some problems limitations during this research work which none is considered so serious as to affect its validity.
1.9 Definition of Terms
Sales Promotion
This is face-to-face interaction between the seller and the prospective buyers to facilitate and actualise sales.
Customer
It is an individual organisation that buys a product both finished or raw materials for use or resale.
Customer loyalty
It is the result of consistently positive emotional experience, physical attribute-based satisfaction and perceived value of an experience, which includes the product or services.