Effectiveness Of Personal Selling Strategies In Marketing Of Cosmetics

Project and Seminar Material for Marketing

Effectiveness Of Personal Selling Strategies In Marketing Of Cosmetics


Abstract


This research work is centered on the effectiveness of personal selling in the marketing of cosmetics. It is necessitated by managerial uncertainty with regard to the cause of the aforementioned reduction in sales volumes and profitability in recent times. This managerial indecision created a room for its suspicion as to whether the sales force was effective or not, with a special reference on Bianca cosmetics company.

The data for the study were collected using questionnaires and oral interviews.

The hypothesis of the study were tested using chi – square. After analyzing and testing the hypothesis the researcher made the following findings.

  1. The ratio of sales expense to sales volume is not high.
  2. The ratio of sales calls to sales volume is high.
  3. There is a high ratio between current and past performance of sales.
  4. Most sales calls normally result into sales.
  5. The management of Bianca cosmetics use straight salary plan as compensation.
  6. The service of both polytechnic and university graduate were used carrying out the sales task of the organization.
  7. Person selling has made positive impact on the profit returns of the company.
  8. It was discovered that personal selling is at great benefit to customers.
  9. It was discovered that the customers are satisfied with the marketing effort of Bianca cosmetics.
  10. The customers believed that the sales people
    are trained to carryout the marketing task.
  11. The customers are of opinion that sales people are excessively persuasive in carrying out their Selling functions.
  12. It was discovered that the price of Bianca product is commensurate with its quality.
  13. It was discovered that the management of Bianca cosmetics normally grants its customers some credit facilities.

Based on the findings the researcher made the following recommendations:

  1. Management should indulge in consumer’s research.
  2. Management of Bianca cosmetics should endeavour to establish market intelligent department.
  3. The relevance of effective sales force in the marketing of cosmetics cannot be over emphasized.
  4. Sales force should improve on their after sales services.
  5. Management of Bianca cosmetics should once in a while organize sales promotional and public relations activities for their sales force.

Chapter One


Introduction

1.1 Background to the Study

According to L.A Rogers (1980) personal selling has become one of the vital promotional tools in marketing. He further buttressed the above proposition by stipulating that after all the theorists, planners must have had their moment and the predicaments associated with production, finance and labour have been resolved, then someone has to go out and knock at someone’s door and sell.

This revelation is apparently acceptable because a product cannot be produced at Enugu and is not available in place like Lagos where such product is highly needed. This is the significance behind the notion of sales contention that, they should investigate into the needs of consumers as well as filling them with satisfaction and maximize profit objectives.

A critical analysis of the above statement highlights the importance of the effectiveness of personal selling on the marketing of cosmetics. A product may be of extremely high grade but has no utility until it gets to the hands of prospective buyers, and the most appropriate route for passing products from manufacturing arena to the hands of potential buyers happens to be through personal selling.

Personal selling is dynamic, flexible and volatile. Traditionally, it is mainly associated with commercial transactions which has passed through distinct eras that are characterized as, the eras of the early traders the American peddlers and the era of the professional sales people. The early traders exist in most ancient cities. Some of these earliest states based the primary portion of their economics on trading with other communities. Traders typically have the ownership of the goods being sold, manufactured either by themselves or their immediate families. At times, they perform their marketing functions like, transportations, and storage, in addition to selling obligations.

The American peddlers of the colonial era enable them sell their goods to the then settlers. Most of these setters were immigrants who view their respective jobs as one of the available means of getting a fresh start in a new country. Professional selling started shortly after the world war 11. Under this seen, the economy switched from the previous situation of sellers’ market to that of buyers’ market in which goods were plentiful in supply. Due to the industrial revolution of the 17th century which encourage the birth of a number of new industries of which cosmetic industries were among.

The industries had varieties of product with moderate qualities. As at the said era, many industries operated under the philosophy “that the customers will buy any product provided it can be supplied”. Goods had to be marketed mainly for the facts that consumers now having choices and the selling adopted a radical change to reject this new seen.

Bianca cosmetic industry is located at no 1 Temple Avenue here in Enugu. It was established in 1996 by Mrs. Bianca Odinaka Ojukwu, (The managing Director). She was married to His Excellency Ikemba Odumegwu Ojukwu from Nnewi with children. She was the first beauty pageant. She started as a small-scale business, and later developed into a distributor. Her products are now distributed to places like Lagos, Abuja, Port Harcourt etc. Infact, Bianca’s products are now nation wide products and even beyond. It has been a leading firm in the cosmetic industry in Nigeria with transparent image.

The progress and high demanded of the product is a partial brain behind the industry’s elevation in product capacity in previous years, and this also created rooms for the absorption of more workers in the divergent department, thus helped to reduce the high rate of social menace that would have associated the situation of mass unemployment. However, the afore mentioned industry which had attained the peak in the cosmetic manufacturing industry, has started experiencing a dwindling ground in its sales volume and market share.

According to an insider, this experience is accounted for by a number of recent developments. Some of are, the incessant increase in the number of industries currently involved in the manufacturing and sales of different types of cosmetics and besides of increase and efficient application of the divergent promotional tools.

Thus, the management of Bianca cosmetic is not skeptical regarding the wonders of personal selling in the marketing of cosmetics and that this promo tool could only justify its wonders in marketing of cosmetics only when it is effective to this end, the management is interested in knowing if the sales force is effective or otherwise. This is the core of this study.


1.2 Statement of the Problems

Bianca cosmetic industry has started experiencing a reduction in its sales volumes in recent times. This low sales volume is caused by a keen competition that exist in the industry as regards the quality of the product, customer service, and effective utilization of promo tools. This is a direct opposite of what the company used to witness in the previous years. The reason for other serious problems like reduced profitability, low market share, and reduction in the rate of promotion as well as that of employment is still unknown to the management of the company. However, the company’s management is seriously questioning the effectiveness of the sales force.

The specific problems to be addressed are:

  • Is the ratio of sales expense to sales volumes high or low?
  • Is the ratio of sales to sales call high or low?

1.3 Objectives of the Study

Whatever the nature and structure of an organization, personal selling has been acknowledge as the bedrock of its success over cut throat competition. Thus enabling the company to generate more funds for its operations.
The aforementioned fact is the primary reason behind the huge amount budget on regular bases into the sales departments. To this end, the objectives of the study are: To determine the influence of personal selling on organizational performance of cosmetic shop in Enugu.


1.4 Scope of the study

This study on the effectiveness of personal selling strategies in marketing cosmetics will focus on Bianca cosmetics in Enugu.


1.5 Significance Of The Study

The findings of the study were of value to the theory as it depicts the usage of personal selling by the companies and its influence on performance. The findings of the study seeks to confirm that organizations try to fit in with the norm by pursuing selling that validates them as part of the organizational field. It would provide a reference point as well as recommendations on the areas the management of the companies can improve on in order to be competitive in the market.

The study would also be of benefit to prospective investors in the cosmetics in Nigeria as it would provide an understanding of the influence that personal selling have on the performance of the company. The practitioners largely characterized by the manufacturers, this research was useful to those organizations that manufacture products branded and positioned as cosmetic to enhance market penetration and justify increased usage of the claims or look for alternative ways of enhancing consumer purchase decisions.

This study was of benefit to the practitioners and academicians both in the private and in public sector by having contributed to the existing body of knowledge in the area of personal selling.

Academicians may use findings for further research, while practitioners may apply lessons in planning and implementing future strategies in order to market the company.


1.5 Limitations of the Study

The study limited itself to information and details that could be discussed without compromising any part of the company‟s business aspects as it competes in a very dynamic and competitive industry. Limited accessibility to information in the organization due to confidentiality being maintained which strained accessibility of data there was also a lack of cooperation from some staff during interviews as they had to go out of their work schedule to respond. The limitations however did not affect the data collected to undertake the study.


Chapter Five


Summary, Conclusion and Recommendations

5.1 Introduction

This chapter gives the summary, conclusion and recommendations and limitations of the study.
The suggestion for further research was also highlighted.


5.2 Summary of Findings

The study found out those cosmetic companies advertises their products through various medium, however before deciding which medium to use, the companies considers the product features, message characteristics, objectives of personal selling, audience characteristics and the cost of medium. The marketplace is evolving so rapidly in many cases that knowing what‟s working and what‟s not almost as fast as it is happening has great value. Personal selling not only helps firms generate awareness among customers for their products and services but also serves as a useful vehicle in promoting brand image of products and services offered at the target market. The study established that personal selling in the cosmetic industry enables the companies to create good image and promote the reiterate purchase of the product or service, create large market segment which leads to the development of larger market, maintain superior stand in the industry, establish good relationship with potential customers and reduce consumer dissonance.

The study found out that personal selling plays a critical role in the competitive cosmetic industry as it helps the companies create awareness, appeal, creation of standards through competition, conviction, minimize hindrances between the organization and customers and employment opportunities. Performance of the cosmetic companies is influenced by advertisement being undertaken by the company as it enables the companies to achieve its set goals through the nonuses trying to use the product while at the same time encouraging season buying. The survival of the companies in any industry depends on competition and the strategies put in place by the company and therefore the pursuit of advertisement by the companies being one of the strategies will enable the companies to enhance the purchase of organizational products by the consumer, increase volume of sales, increase the profits of the organization and enhance the organization relationship with its customers.


5.3 Conclusion

Experience has shown that for any organization to succeed or grow and at the same time keep abreast with the rapid changes in today‟s business and technological environment, the laws of success must be observed and obeyed as a guiding principle. Otherwise, failure will subsist. Personal selling policy is one of the inevitable laws of success in an organization. It is a truism that success or otherwise of any company lies in its ability to evolve the right strategies at the right time. Right strategies at wrong time can spell doom for an organization. Even the right strategies and right timing are not sufficient, the implementation, evaluation and monitoring of the strategies are germane to the success of the company. Personal selling is one of these strategies. From the analysis and the findings, it is crystal clear that there personal selling has an effect on the performance of cosmetic companies.

From the study it can be concluded that personal selling plays a major role in the performance of an organization as it creates awareness while at the same time encouraging the non-users to try the products or services of the firm and this will make the company to be competitive. Personal selling not only helps the companies to maintain superior stand in the industry and profit maximization, it provides information about a products or services and also gives consumers free television and radio programmes. Personal selling gives a clear image for any product or service of a company which is a great asset. A well structured and continuous personal selling might stand as one of those strategies to sustain a distinct market position. It could also help to identify strong market competitors. No matter how successful a product or service is for a company and regardless of the edge the company has in the industry, personal selling is a must and should be a continuous
activity.


5.5 Recommendations for the Study

The study found out that personal selling plays a role in the operations of the cosmetic companies and it is recommended that the companies should endeavour at all time to have a planned and systematic sales promotion programme in place as this would help to make such advertisement implementation effective. Top management should be involved in the continuous evaluation and monitoring of personal selling to ensure that the goals and objectives set are achieved and appropriate corrective actions are taken in the event of deficiencies. The companies should harmonize all departments so as to realize the goals and objectives of personal selling.

The study established that the cosmetic companies consider several factors before deciding which medium to use to advertise. It is recommended that as advert campaigns are relayed from different service providers, the adverts should be used to aid the customers to identify the company‟s products or service when they are making a purchase decision. The companies should also ensure that personal selling agencies place their product adverts on stations and places where the consumers will easily identify with them make a purchase. A good advert should be effective, persuasive and contain the necessary information on the products. Regular and consistent up-todate training on product information should be given to the personal selling agency so that they will have the current knowledge and skills to handle the adverts and also to ensure that product information is being emphasized so as to enlighten the customers.

As a result of long term benefit of personal selling on the economy, the Government should compel all companies operating in the cosmetic industry to educate consumers and the general public about advertisement of their products. This will protect the public from side effects of the various products that are being sold by the companies. The companies should be aware of the fact that there are times when the effective use of advertisements are needed e.g. during festive periods. Companies should take full advantage of such peak seasons by developing an effective and efficient personal selling campaign that can arouse consumer‟s awareness, thereby leading to increase in sales.


5.6 Suggestions for Further Research

The study was undertaken in the cosmetic industry which has a few firms. A further research should be undertaken to further explore the nature of personal selling in employing bigger samples and carrying out a more detailed analysis of firms. This would, in turn, help us get more insight into the nature of personal selling and informing various stakeholders on the benefits or otherwise of spending large sums of money on personal selling. A study further needs to be undertaken to determine the medium that is mostly used by the cosmetic companies to advertise their products.


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