Effect Of Advertising On Brand Preference (A Case Study Of Nestle Ng)

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Effect Of Advertising On Brand Preference (A Case Study Of Nestle Ng)


Abstract


This study was carried out to examine the effect of advertising on brand preference using Nestle NG. Lagos State as a case study. The study was carried out to determine whether advertising has a significant relationship with consumers brand preference, examine the factors that drive consumer brand preference, ascertain whether advertisement increases consumers brand awareness, ascertain whether advertisement stimulates consumers brand interest, investigate the extent advertisement triggers consumer brand patronage. The survey design was adopted and the simple random sampling techniques were employed in this study. The population size comprise of staff marketing/advertisement department of Nestle NG. Lagos State. In determining the sample size, the researcher conveniently selected 57 respondents and 50 were validated. Self-constructed and validated questionnaire was used for data collection. The collected and validated questionnaires were analyzed using frequency tables. While the hypotheses were tested using Chi-square statistical tool. The result of the findings reveals that advertising has a significant relationship with consumers brand preference. The study also revealed that the factors that drive consumer brand preference includes: brand quality, brand pricing strategy, brand availability, brand packaging, brand recognition, brand differentiation. Therefore, it is recommended that It is of the researcher’s opinion that manufacturing and other forms of business organizations should seek the service of a consultant who will exposes them to other essentials of advertising and who will also bring to their notice the most effective form of advertising campaign and the most suitable and effective systems of execution. This is necessary because advertising is one sector of a business organization that sustains the products competitiveness and patronage in the market. To mention but a few.


Table of Content


Chapter One:

Introduction

  • 1.1 Background of the Study
  • 1.2 Statement of the Problem
  • 1.3 Objective of the Study
  • 1.4 Research Questions
  • 1.5 Research Hypothesis
  • 1.6 Significance of the Study
  • 1.7 Scope of the Study
  • 1.8 Limitation of the Study
  • 1.9 Definition of Terms
  • 1.10 Organization of the Study

Chapter Two:

Review of Literature

  • 2.1 Conceptual Framework
  • 2.2 Theoretical Framework
  • 2.3 Empirical Review

Chapter Three:

Research Methodology

  • 3.1 Research Design
  • 3.2 Population of the Study
  • 3.3 Sample Size Determination
  • 3.4 Sample Size Selection Technique and Procedure
  • 3.5 Research Instrument and Administration
  • 3.6 Method of Data Collection
  • 3.7 Method of Data Analysis
  • 3.8 Validity of the Study
  • 3.9 Reliability of the Study
  • 3.10 Ethical Consideration

Chapter Four:

Data Presentation and Analysis

  • 4.1 Data Presentation
  • 4.2 Analysis of Data
  • 4.3 Answering Research Questions
  • 4.4 Test of Hypotheses
  • 4.5 Discussion of Findings

Chapter Five:

Summary, Conclusion and Recommendation

  • 5.1 Summary
  • 5.2 Conclusion
  • 5.3 Recommendation
  • 5.4 Suggestion for Further Studies
  • References
  • APPENDIX
  • QUESTIONNAIRE

Chapter One


Introduction

1.1 Background of the Study

Advertisement has been an essential marketing tool for businesses but it has never been as widespread and overwhelming as in the past few years. There is hardly a moment in our life when we do not encounter an advertisement. There is no escape route from advertisement ranging from breakfast cereals to late night movies (Acharyya & Mukherjee, 2003). Advertiser’s main objective is to reach potential consumers and influence their awareness, attitudes and buying behaviors. They spend huge sums of money to keep individuals (market) interested in their product (Ayanwale, Alimi, & Ayanbimipe, 2005). The role of advertisement as a marketing tool is to carry message to far distances. Its role on sales volume is very important hence advertisement is directly linked with the sales of the product (Adekoya, 2011).

Marketers’ existence is dependent on consumer satisfaction which in turn depends on their perception and brand preference of a particular brand. In brand preference, advertisement plays an important role. Just about everyone in this modern world is influenced to some extent by advertisement (Moorthy & Madevan, 2014). Fatima and Lodhi (2015) noted that advertisements over the years, have been used as a means of influencing the buying behaviors of customers. Advertisement assists companies to create awareness of their products and brands in customers (both existing and potential) and elements within the advertisements also helps in shaping the perception of the customers towards the brand either in a positive or negative way.

However, the degree of advertisement cannot be overstated, because in most advanced economies like the United States mature product categories are more distinctive of what is advertised. Most marketing researchers in a mature product market, would assert the role of advertising to be limited, especially if product attributes were essential to the brand choice process and preferences were well formed (D’Souza & Rao, 1995).

In this present era of advertisement, marketers constantly focus more on customer rule, in that, the customer is their priority as the 21st century consumer is considered as king in the marketplace (Gupta & Shallu, 2013). Marketers constantly pay attention to different factors that can attract more and more customers since their taste and preferences keeps changing (Fatima & Lodhi, 2015). Although consumers are becoming more mindful about brands, the actual choice of a brand is in their hands (consumers) and can be influenced by advertisement (Desai, 2014). Consumers make purchasing decisions every day, however, most of these consumers do not even know what drive their decision (Lautiainen, 2015). Buying sachet water comes almost automatically and does not need much information search. However, the purchase decisions of consumers are almost always based on certain factors; cultural, social, personal or psychological factors (Lautiainen, 2015). Nevertheless, advertisement can help in influencing these factors to some extent to impact consumers’ purchasing (Fatima & Lodhi, 2015).This study will therefore analyze the effect of advertisement on brand preference with respect to Nestle NG, Logos State.


1.2 Statement of the Problem

There are quite a number of brands available in the market for various products. A number of which are successful only in a small geographical area with majority thriving in numerous geographical areas and markets. The proliferation of different product brands in Nigeria has led to keen competition for increased market share being witnessed among the producers and operators in the manufacturing industry. Most companies spend enormous amount of money on advertisement in order to maintain and enlarge their market share. This however begs the question ‘‘Does advertisement really have any effect on consumers’ brand preference?’’.

The ways through which organizations connect with their consumers are mostly through advertisement where they put their message across and to influence consumers in their choice of selecting that particular brand.
Most studies carried out in this area to determine the influence of advertisement on consumer brand preference has indicated that advertisement significantly affects brand preference. Ayanwale et al (2005) indicated that advertisement has a major influence on consumers’ preference in the food drink industry. Haider, Khan, Latif and Nadeem (2012) also emphasized this point as they observed that there is a positive relationship between advertisement and brand preference in the toilet soap industry. However, with respect to sachet water, researchers have focused on quality (Stoler et al., 2014; Addo, Mensah, Bekoe, Bonsu, & Akyeh, 2009) and have not taken into consideration the role advertisement plays in the sachet water industry. This research is being focused on the food and beverages industry because, researches done in this area of study mostly focused on other products categories. Hence, the study seeks to analyze the effect of advertisement on brand preference using Nestle, NG as a case study.


1.3 Objectives of the Study

The general objective of the study was to examine the relationship between advertisement and brand preference.
The study sought to achieve the following specific objectives:

  1. To determine whether advertising has a significant relationship with consumers brand preference.
  2. To examine the factors that drive consumer brand preference.
  3. To ascertain whether advertisement increases consumers brand awareness.
  4. To ascertain whether advertisement stimulates consumers brand interest.
  5. To investigate the extent advertisement triggers consumer brand patronage.

1.4 Research Questions

The study will be guided by the following questions;

  1. Does advertising have a significant relationship with consumers brand preference?
  2. What are the factors that drive consumer brand preference?
  3. Does advertisement increase consumers brand awareness?
  4. Does advertisement stimulate consumers brand interest?
  5. To what extent does advertisement trigger consumer brand patronage?

1.5 Research Hypotheses

  • Ho: Advertisement has no effect on consumer brand preference.
  • Ha: Advertisement has an effect on consumer brand preference.

1.6 Significance of the Study

To academia, this study will provide a basis for further research works and also improve literature used for teaching and learning. As this study gives a clear understanding into how advertisement can influence consumer brand preference, it will help companies in the sachet water industry to better understand the relevance of advertisement.

Many producing companies may be encouraged into using adverts to market their brands. When industries start making more sales and profits as a result of advertisement, the economy of Nigeria will be enhanced, as more revenue from tax will be accumulated to the government of Nigeria. The findings and recommendations of this research will help companies to position brands and advertisement in an appealing manner which will eventually lead to more sales and improved performance.


1.7 Scope of the Study

This study is structured to generally examine the effect of advertising on brand preference using Nestle NG. Lagos State as a case study. The respondents for this study will be obtained from the marketing/advertisement department of Nestle NG. Lagos State.


1.8 Limitation of the Study

Like in every human endeavour, the researcher encountered slight constraints while carrying out the study. Insufficient funds tend to impede the efficiency of the researcher in sourcing for the relevant materials, literature, or information and in the process of data collection, which is why the researcher resorted to a limited choice of sample size. More so, the researcher simultaneously engaged in this study with other academic work. As a result, the amount of time spent on research will be reduced.

Moreover, the case study method utilized in the study posed some challenges to the investigator including the possibility of biases and poor judgment of issues. However, the investigator relied on respect for the general principles of procedures, justice, fairness, objectivity in observation and recording, and weighing of evidence to overcome the challenges.


1.9 Definition of Terms

Advertising:

According to Arens (2004:7), advertising is the structured and composed nonpersonal communication of information, usually paid for and usually persuasive in nature, about products (goods, services or ideas) by identified sponsors through various media.

Consumers:

Are people who purchase and use goods or services to satisfy particular needs and wants.

Consumer Behavior:

Are those acts of individuals directly involved in obtaining and using economic goods and services. (Nwaizugbo 2004)

Brand:

This is a name, term, symbol, design, mark or a combination of these that identifies the product of a manufacturer or differentiates it from those of competitors.

Brand Preference

Brand preference is the behavioral propensities reflecting a consumer’s attitude towards a brand.


1.10 Organization of the Study

This research work is organized in five chapters, for easy understanding, as follows.

  • Chapter one is concern with the introduction, which consist of the (overview, of the study), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study.
  • Chapter two highlights the theoretical framework on which the study is based, thus the review of related literature.
  • Chapter three deals on the research design and methodology adopted in the study.
  • Chapter four concentrate on the data collection and analysis and presentation of finding.
  • Chapter five gives summary, conclusion, and recommendations made of the study.

Chapter Five


Summary, Conclusions and Recommendations:

5.1 Introduction

This chapter summarizes the findings on the effect of advertising on brand preference using Nestle NG. Lagos State as a case study. The chapter consists of summary of the study, conclusions, and recommendations.


5.2 Summary of the Study

In this study, our focus was on the effect of advertising on brand preference using Nestle NG. Lagos State as a case study.The study is was specifically carried out to determine whether advertising has a significant relationship with consumers brand preference, examine the factors that drive consumer brand preference, ascertain whether advertisement increases consumers brand awareness, ascertain whether advertisement stimulates consumers brand interest, investigate the extent advertisement triggers consumer brand patronage.

The study adopted the survey research design and randomly enrolled participants in the study. A total of 50 responses were validated from the enrolled participants where all respondent were staff marketing/advertisement department of Nestle NG. Lagos State.


5.3 Conclusions

Based on the findings of this study, the researcher concluded that;

  1. Advertising has a significant relationship with consumers brand preference.
  2. The factors that drive consumer brand preference includes: brand quality, brand pricing strategy, brand availability, brand packaging, brand recognition, brand differentiation.
  3. Advertisement increase consumers brand awareness.
  4. Advertisement stimulate consumers brand interest.
  5. The extent advertisement trigger consumer brand patronage is high.

5.3 Recommendations

Based on the responses obtained, the researcher proffers the following recommendations:

  1. Organizations should consider promotional schemes for retaining their customers, as consumers are ready to move on to other brands.
  2. Organizations should hire psychologists to help them with other decisions to make the consumer buy more.
  3. It is of the researcher’s opinion that manufacturing and other forms of business organizations should seek the service of a consultant who will exposes them to other essentials of advertising and who will also bring to their notice the most effective form of advertising campaign and the most suitable and effective systems of execution. This is necessary because advertising is one sector of a business organization that sustains the products competitiveness and patronage in the market.

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