THE IMPACT OF SALES PROMOTION ON THE SALES OF SOFT DRINKS IN NIGERIA
(A CASE STUDY OF 7UP BOTTLING COMPANY PLC, ABA)
One of the major problems addressed was due to the low amount of money invested by the company on sales promotion activity result to low sales turnover was addressed which result to the increase in sales turnover.
The total population used is two hundred (200) made up of production department, marketing/production and Administration department and sample of 133 employees was randomly drawn from 7up bottling Company Plc Aba depot.
The personal interview and questionnaire are as well analyses accordingly.
The researcher used chi-square (X2) statistics for testing hypotheses formulated. Findings show that inadequate capital base is a major problem responsible for the low company’s sales turnover.
The researcher recommended that the marketing manager of 7up Bottling Company Plc, Aba Depot should know that the use of sales promotion activities is the only way to ensure consumers patronage and as such they should maintain its product quality and price.
1.1 Background of the study
1.1.1 PROFILE OF 7UP BOTTLING COMPANY Plc,
1.2 Statement of the problem
1.3 Objectives of the study
1.4 Research Questions
1.5 Research Hypotheses
1.6 Significance of the study
1.7 Scope and Limitations of the study
1.8 Definition of terms.
2.2 The concept of marketing
2.3 Promotional activity in Nigeria
2.4 Elements of promotional Mix
2.5 What is sales promotion
2.6 Types of sales promotion
2.7 Objective of sales promotion program
2.8 Sale promotion techniques
2.9 Developing the sales promotion program
2.10 Evaluating sales promotion effectiveness
2.11 Comparison of promotional Element
2.12 The benefits of Sales promotion
2.13 Problems of sales promotion.
2.14 Liability and limits of sales promotion
2.15 What to consider in adopting sales promotion
3.1 Design of the study
3.2 Area of the study
3.3 Population of the study
3.4 Sample and sampling techniques
3.5 Method of data collection
3.6 Method of data Analysis.
Presentation and analysis of data
4.1 Question by question analysis of the investigation research questions
4.2 Testing of hypotheses
4.3 Discussion of findings
Summary, conclusions and recommendations
5.1 Restatement of findings
5.5 Suggesting for further studies
1.1 BACKGROUND OF THE STUDY
Marketing generally is aimed at profitable sales by offering want satisfy goods and services to the market.
Every Business Organization be it manufacturing distributive or service firm has the goal of its marketing efforts.
But purchase in sales and profitability of a firm cannot be enhanced without promotion .
Advertising, personal selling, publicity and sales promotion are the salient from a promotion available to most tools are suitable for both industrial products and consumer items.
Most soft drinks companies usually employ advertising personal selling and to some extent publicity and perhaps sales promotion in promoting their products.
But the extent to which sales promotion impact the consumption of soft drinks is yet to be ascertained.
It is in the light of the above that the research thought it is wise to study the impact of sales promotion on the consumption of soft drinks ie (7UP products) in a segment of Abia State Nigeria using 7 Up Bottling Company ,Aba as a case study.
Sales promotion is one of the important promotion tools that have gained a lot of popularity in recent time, perhaps because of increase in competition in a depressed economy where disposable income kept on decreasing over a period of time. The American marketing Association (AMA) define sales promotion as activities other than personal selling.
Advertising and Publicity designed to stimulate sales and dealers effectiveness, which may take the form of display demonstrations shows and exhibition and various non-recurrent effort not in the ordinary routine.
Sales promotion is define by the author as that marketing function that seeks to achieve a given marketing objective by adding something of extrinsic value for the purpose of stimulating consumer and dealer effective within a given period of time, usually 3-4 months.
Sales promotion objective could be spelt out as follows to induce trial purchase, to induce repeat/multiple purchase, to increase our market share, to attract competitors market share, to smother season or demand for the product, and attract brand switcher to the product who will generalize after the promotion.
All those three main segments of s ales promoted simultaneously.
Otherwise one of those participants may frustrate the other by not passing down incentive to the final consumer.
1.1.1 PROFILE OF 7 UP BOTTLING COMPANY PLC
Seven Up is an International name is soft drinks business and was developed under modest circumstance in the United states of America in early 1920’s by C/L GRIGG, who also suggested the name “Seven Up”.
There is over 900 factories spread over 176 countries of the world.
A Lebanese name MOHAMMED EL-KHALI settled in Nigeria in 1926, and in 1956, he established a bottling company. Consequently in October 1, 1960 the first bottle of seven Up green and white on 7 up bottle thus rolled it of Ijora plant in Lagos. The colour green and white on 7up thus signifies the independent Day of Nigeria.
It second plant was opened in 1980 (twenty years after the first plant was opened) following by numerous depots opened all around the southern part of the country.
By setting up a plant at Kano 1983 seven-up company bought over Pepsi cola International and re-launched Pepsi in Nigeria in 1988 by so doing ,seven up became the number one brand in the Southern parts of Nigeria and it won the international Bottler of soft drinks award for the year 1989.
With this success, seven up opened Aba bottling plant and at the same year acquired the assets of soft drink division of John Kolt company.
There are currently 7 plants in various parts of the country-Nigeria-Aba, Benin, ILorin, Ikeja, Ibadan, kano and Kaduna, More are yet to come.
Pepsi cola is the best seller among them in East other products, 7up, Mirinda, orange Team, Cemonade, Mirinda Soda Water, Mirinda Tonic, Mirinda Ginger, Mirinda pineapples, Pepsi spice etc.
Seven up has made a remarkable impact on the economy of Nigeria, they create employment to unemployed Nigerian, render saturated amenities to communities and contributed to the nations economic growth way of generating fund, which is circulating in the economy.
They have engaged in a backward vertical integration with sun-glass Kaduna as the sources of some of their raw material.
Seven –Up gives people the right of choice and was able to force competitors drawn I price.
It is also gathered that the company has not suffered any shut down since in business and this is a credit to the company.
This company has also made great impact in the sales promotion, advertising etc. The company is noted for its tremendous engagement sales promotion.
Thus 1991- There was “EXPRESS” sale promotion.
January 1993 – 7up spell and Win
June 1993 – Wain mania
January 1994 – 7 Up spell and win
June 1996 high life
August 1995 – 7 up spell and win
September 1996 – 7 up high life
October 1998 till year 2001 January – winning was based on 7up high life, T-shirt Bonanza etc
There are slogans that create lasting impression such as:
The sales promotion techniques adopted 7up bottling company to beat the drawn about its product include:
These techniques are designed to reach a diversity of target audience and to achieve a wide range of objective such as
To this end all things being equal, seven up products really have prospect in the country and the marketing mix should and for better marketing strategies.
1.2 STATEMENT OF THE PROBLEM.
The major problem addressed was the low amount of money invested by the company sales promotion that always result to low sales, turnover was addressed due to the that fact huge amount of money was invested and their sales turnover becomes high which gave them the edge to become market leader in the soft drinks industry in Nigeria.
Sales promotion is essential in every company or business organization that want to achieve it stated or set objectives. The researcher identifies the following problems. The improper research carried out on sales promotional activity on how it influence consumer purchases has result to low increase sales of 7up product. The difficulty in convincing consumers to believe in the fantastic star prices of sales promotion has affected the sales volume of 7up product. The improper use of different sales promotional tools to promote their products has resulted to low profitability.
This research work therefore aim at addressing the problem of sales promotion for effective performance
1.3 OBJECTIVE OF THE STUDY
The objectives of the study were:
1.4 RESEARCH QUESTIONS
The following major research questions were considered in the study.
1.5 RESEARCH HYPOTHESES.
The following hypotheses were posited and tested in the study.
Ho1: Improper research carried out on sales promotional activity on how it influence consumer purchasing does not result to low increase is sales of soft drinks.
Hi1: Improper research carried out on sales promotional activities on how it affect consumers purchasing has result to low increase is sales of soft drinks.
Ho2: Difficulty in convincing consumer fantastic star prizes of sales promotion does not affect purchasing of soft drinks.
H12: Difficulty in convincing consumer to believe in the fantastic start prizes of sales promotion has impact on the purchasing of soft drinks.
Ho3: Improper use of difficulty sales promotional tools to promote their product does not affect their profitability.
Hi3: Improper use of different sales promotional tools to promote their product does not affect their profitability.
Ho4: The low amount of money invested by the company on sales promotional activity has resulted to low sales turnover.
Hi4: the low amount of money invested by the company on sales promotion activity does not bring about low sales turnover.
1.6 SIGNIFICANCE OF THE STUDY
Some management decisions to carry out promotional activities in many large organization are not guided by clear cut strategies.
However, luck may bring success for sharply defined purpose, improper initialization of resources may set in.
Against, this background and also with the back of empirical data on the relationship between promotional expenditure and sales, the success of those in this study would be of tremendous importance to those in these areas.
These studies would be tremendous helpful to both present and potential sales promotion manager to know the impact of promoting and using the right promotional tools.
The study will also necessitate a more impact coordination of the different promotional techniques of enhancing product patronage.
b. This study will help to fetch out the promotional problems facing 7up Bottling Company Plc Aba.
c. It will give the researcher and other users of the study an insight in to the promotional activities used by the business or large companies.
d. It would enable the 7up Bottling Company Plc Aba to give prominence attention some of the sales promotion tools
e. This study would enable the company achieve its objectives with the firms in applying some of sales promotional tools.
F. The suggestion of the elimination of the problem would be addressed .
g. The company through this research material would know the type of persuading in information attracting confidence and trust in consumers.
H. Finally the study would help the researcher who might want to use it for further study as source of reference.
1.8 DEFINITION OF TERMS
The following terms used in the study are defined as below:
ADVERTISING : Any paid form of non-personal presentation and promotion of ideas, goods or service by an identified sponsor, Includes the uses of such media as television set, Radio, Newspaper and Magazine etc (Mccarthy and Parauth 1987).
ADVERTISEMENT AGENCY: It is an independent company s et up to render specialized service of advertising in particular and of marketing in general (,Stanton 1985).
CONSUMER: A consumer is one whose goods/product in an exchange process (Scheme 1987)
CONSUMER GOODS: Are those goods and services destined for the ultimate consumers (McCarthy 1975).
CASH REFUND OFFERS (REBATES): Officer to refund part of the purchase price of a product to consumer who send a proof of purchase to the manufactures or it provide a price reduction after purchase rather than at the retail shop consumer send a specified proof of purchase” to the manufacturers who refund’ part of the purchase price by mail (Baker 1999 601)
COUPONS: Is the certificates that gives buyers a savings when they purchase a specified product of mailed, endorsed in other products or them, or inserted in magazine and newspapers. It is effective in stimulating sales of a mature brand and inducing early trail of anew brand (Michael Baker 1999 611).
DEALER LOADER: A dealer loader is a gift that is given to retailer who purchase a specified quantity of merchandize often dealer loader are use in an attempt to obtain special display part of premium (Ferred 1985).
DEALER LISTING: A dealer listing is a gift that is an advertisement that promotes a products and identifies the name of the participating dealers (Ibid).
Exhibitions: Are used as a form of sales promotion in both consumer and industrial goods market modern (1989-467) list five advantages of exhibitions as creations of awareness and recalled.
FREE MERCHANDIZE: It is sometimes offered to resellers who purchase a stated quantity of the same or different products.
Occasionally, free merchandise is used a payment for allowance provided through others sales promotion. It is usually accomplished by reducing the invoice to avoid handling and book keeping problems (IBID)
FREE CONRAIL: Inviting prospective purchasers to try the product without cost in the hope that will buy the products (Philip Kotler 1999).
FREQUENCY: this is the number of time an a advertisement is show/placed in a particular period of time (smith PR 1994-129
MARKET: Is a group of potential customers with similar needs who are willing to exchange something of value with sellers offering, various goods and/or services that is ways of satisfying those needs (William.MC Carthy 1996).
MARKETING: Is a societal process by which individuals and groups obtained what they wants and needs through creating offering and freely exchanging products and services of values other (Philip Kotler Pg 8200)
MARKETING MIX: Is the controllable variables that the company puts together to satisfy a target group (William 1967)
PERSONAL SELLING: According to Philip Kotler 1987, 461 say it is a personal presentation by the firm sales force for the purpose of marketing sales and building customers.
PRICES: price is what the buyer gives up in exchange for something that provides satisfaction (Scheme 1987 vii).
PROMOTION: It involves communicating information between sellers and potential buyers or others in the changed to influence attitudes and behaviour (Willaims/McCarthy,1996:10)
PATRONAGE REWARD: Cash or other awards for the regular use of a certain company’s products, or company services (Philip Kotler 1998).
PRICE PACKS (CENT- OF DEALS): It is offers to consumer of savings off the regular price of a products, flagged on the label or package (Michael Barker 1999).
POINT OF PURCHASE (POP) DISPLAY AND DEMONSTRATIONS: It take place at the point of purchase or sales many retailers do not like to handle hundreds of display sign and posters their receive form manufactories. Manufacturers are creating better Pop material trying them in with television of print message and offering to set them up (Philip Kotler 200p 602).
Publicity: is an activities to promote a company or its product by planting news about it in media not paid for by the sponsor (Philip Kkotler 1997 518).
PROMOTIONAL MIX: It is a specific mix of advertising personal selling promotional and public relations a company uses to pursue its advertising and marketing objective (Philip Kotler 1997, 461).
PRODUCT: Product is anything that can be offer to a market for attention, acquisition, use or need. It include physical objective services, places organization, ideas and people (Philip Kotler 2000.394).
PREMIUMS: A premium is a reward that offer free or at encourage an exchange. it is a products offered free or at less than the regular price in order to induce the consumer to buy on the product (Druker 1978).
Sales promotion: Consist of a diverse collection of incentive tools mostly, stout them, designed to stimulate quicker of greater purchase of particular products or services by consumer or the trade (Philip Kotler 2000 597).
SALES POTENTIAL: Share of a market that a company believe is achievable when its plans and strategies have been fully implemented (closing of marketing terms RBC 1983).
SAMPLING: Mea giving away of a product to consumer s about features of the product that cannot be conveyed adequately through advertising.
It put the products directly into the hand of the consumer (scheme 1990)
SALES CONTESTS: Aim at inducing the sales fore or dealer to increase their sales that sales results over stated period with prices going to those who succeed (Philip Kotler 2000 630).
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