CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
One of the most important and bewildering promotional tools of modern marketing management is sales promotion. Sales promotion is bewildering because of it’s typically tagged effect and also the difficulty of isolating it’s effect from other elements in the marketing mix.
Moreover, sales promotion as a subject matter could be referred to as a “catch all” for those short term marketing activities which act as an incentive to stimulate quick buyers action such as coupons sweepstake, context, premium, free samples and trading sample.
Sale promotion is, however, a sub-section of the total promotional and communication mix. The term promotion in it’s broadest sense means to move forward. However, in the business field, it is referred to as the communication activities of advertising, personal selling, publicity and sales promotion. The blend of these promotional activities is referred to as the promotion mix or tools.
The emphasis that is placed on each element in the promotional mix considering sales promotion varies according to the product types, product characteristics and other variable factors including the company’s resources product within the firms competitive strength and weakness, managerial style and philosophy.
While the other communication elements with which promotion must be coordinated are the product itself, price of the product and the choice of distribution channel. The components of the product communication include the brand name, product design, package colour, product size and shape, trademark, label, task, and so on. These product physical features provide the consumers with subtle messages about the total product offering, the fact remains that the physical product itself can communicate a great deal of information to the prospective buyer.
Without some sense of functional relationship between sales and promotional expenditure, it becomes very difficult to know how much to spend on sales promotion due to the fact that the potential value is being testified to by Nigerian companies which engages in it. Companies in this circumstance tend to resort to simple rules for setting the sales promotion budget that may work satisfactorily in practice but are not likely to represent an optional level. In the case of Etisalat Nigeria sales promotional activities are being carried out at least twice a year, one in the beginning of the year and other during festive periods.
Furthermore, sales promotion expenditures are growing rapidly in other nations, both socialist and capitalist economy of the world. It is unlikely that without the power of sales promotion a new product could not reach it’s potential market so that their interest be drawn to the good offering, provided and developed and that how in the world or business activities and competition could an old product continue to prove successful in terms of increased sales without sales promotion in highly competitive environment. Statistics revealed that over 62.3% of the product that are promoted via sale promotional strategy succeeds.
1.2 STATEMENT OF PROBLEM
The telecommunication industry, which was once dominated by parastatals like NITEL and NIPOST has experienced a drastic change with the introduction of Global system for mobile communication (GSM) into the Nigerian market, having four key players heavily contesting for the attentions of the Nigerian market.
The Nigerian market being relatively illiterate to this new technology will have problem in determining which service provider to subscribe to the responsibility is solely that the provider to be able to educate and convince the market on their product offering.
The study will seek to find the different promotional strategy adopted by Mobile Telephone Networks (ETISALAT) in combating the competition in the market and being able to strive in the industry.
1.3 OBJECTIVE OF THE STUDY
Sales promotion are those activities or devices that are designed to create activities (such as demonstrations, shows, coupons, premium and special sales) that not only supplement advertising and personal selling but also co-ordinate and make them effective which therefore boost company’s sales volume and thereby cause an increase in profit.
1.4 RESEARCH QUESTIONS
Having spotted the problems of study the researcher look at those questions that affect sales promotion in telecommunication.
(1) Does sales promotion really have impact in the marketing of telecommunication industry?
(2) How best can Etisalat use sales promotion in the marketing of it’s products in telecommunication industry?
(3) Is it even necessary for telecommunication industry to use sales promotion for it’s products?
(4) Would sales promotion bring out the best in the marketing of telecommunication industry?
(5) How effective is sales promotional activities in the marketing of telecommunication industry?
1.5 RESEARCH HYPOTHESIS
(1) Ho: There is no significant relationship between sales promotional and company’s profit.
HI: There is significant relationship between sales promotion and company’s profit.
(2) Ho: Sales promotion dose not influence and affects buying behaviour and buying decision.
HI: Sales promotion influence and affect buying behaviour and buying decision.
(3) Ho: There is no correction between medium of sales promotion and desire result.
HI: There is correction between medium of sales promotion and desire result.
(4) Ho: Sales promotion is not a suitable medium for promoting the product offered for sales.
HI: Sales promotion is a suitable medium for promoting the product offered for sales.
1.6 SIGNIFICANCE OF THE STUDY
The findings of this study and research work will be of immense benefit to such companies and their marketing force. Moreover, it will be of great assistance and help to companies which have experienced endless problems in the declining state of their products performance in the product lifecycle. It will also be useful to future researcher as a reference on the basis of research work.
More so, this study will be of great advantage to the management of ETISALAT Nigeria communication limited and other telecommunication companies in designing their framework of promotional activities (i.e. sales promotion) in order to gain a higher and relative market share, to increase profitability, even though it is difficult to quantify precisely to what extent one can increase demand to the point where economies of scale can be achieved.
1.7 SCOPE OF THE STUDY
This research work hopes to examine sales promotion as a marketing tool and marketing strategy to boost company’s sales volum. So therefore the research work only covers the period between 2004-2012 0f the sales promotional activities of ETISALAT Nigeria and only one of the promotions that had been carried out within the time frame will be considered and analyzed.
This study covers the headquarters of ETISALAT Nigeria communication limited situated in Lagos state and one of the branches located along Muritala Muhammed way Ilorin, kwara state.
All the end of the research work we actually would have seen sales promotion to be a booster of sales, market share and company’s profit.
1.8 LIMITATIONS OF THE STUDY
The researcher encounted some set backs in the course of this study paramount among them was the uncooperative attitudes of some members of the staff of ETISALAT Nigeria Limited.
The changes effected in the school academic calendar were a threat to the success of this work. As a result of these changes, there was not enough time for adequate data collection and lack of adequate indigenous textbook on the topic understudy was a problem to the researcher.
1.9 OPERATIONAL DEFINITION OF TERMS
Sales of Promotion: Sale promotion is a variety of short term incentives to encourage trial or purchase of a product or services. Mainly the aim is to jump start purchase by giving consumers a promise of an abundant reward.
Public Relation: A variety of programs designed to promote or protect a company image or individual product. It is often refer to as reputation management.
Advertising: Albert laster, described advertising as “Salesmanship in print, driven by a reason why” it is the most visible aim of marketing mix.
Personal Selling: This is a form of person or persons communication in which a seller attempt to assist and or persuade prospective buyers to purchase the company’s or service or to act on an idea.
Publicity: Publicity refers to a non personal communication regarding an organizations product service or idea not directly paid for or run under an identified sponsor.
G.S.M: Global system of mobile communication.
M.T.N: Mobile telephone Network
Promotion Mix: This refers to the blend of promotional activities.
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