Impact Of Sales Promotion On Consumer Brand Loyalty (A Case Study Of Consumers Of Star Larger Beer And Guinness Extra Smooth In Aba Metropolis)

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Impact Of Sales Promotion On Consumer Brand Loyalty (A Case Study Of Consumers Of Star Larger Beer And Guinness Extra Smooth In Aba Metropolis)


Abstract


This study is a research of the impact of sales promotion on consumer brand loyalty a study of consumer of star lager beer and Guinnes extra smooth in Aba, metropolis Abia states. This research is menth to understand how effective consumers can patronize a product by enhancing sales volume of a company when sales promotions on. Using star lager beer and Guinness extra smooth in Abia metropolis as a study of this research project, the research problems centers on whether consumers will really stick to their brand when other companies (with other brand) are running their sales promotion.

Using Aba metropolis as the area of study. The design of this study is a quasi-experimental quantitative design. The study population shall comprise of both male and female customers of star lager beer and Guinness extra smooth in Aba, metropolis Abia state, Nigeria. This population also included both retailers and wholesalers (depots) around Kampala District. Chi-square test was used by the researcher for bivariate analysis of two categorical variables. Multiple linear regression model was used in this study because it attempts to model the relationship between two or more explanatory variables and a response variable by fitting a linear equation to observed data.

Variance of Analysis (ANOVA) was run to find out the relationship between Relationship between coupons, free sample, price discount and consumer buying behavior during sales promotion. Study results also showed that the there is a significant relationship between the sales promotion and the coupons and free sample at 5 percent level of significance since the p-value is less than 0.05. On the other hand, the regression results also showed a statistically significant negative relationship at (at 5 percent level of significance) between the price discount and the sales promotion of Nigeria breweries in this study since its P-value is less than 0.05. The results were as postulated and this means that on average, a unit price discount leads to a 5.95 decrease in the discount and the sales promotion of Nigeria breweries when the other independent variables are held constant.

Furthermore, the regression results also showed a statistically significant positive relationship at (at 5 percent level of significance) between the free sample and the sales promotion of Nigeria breweries in this study since its P-value is less than 0.05. The results were as postulated and this means that on average, a unit sample leads to a 080 decrease in the discount and the sales promotion of Nigeria breweries when the other independent variables are held constant. The study further recommends that, sales promotions budget should always be adequate in organizations. This would also give sales representatives and consumers alike performance to participate.


Table Of Contents


Preliminary Page(s)

  • Title page
  • Certification page
  • Dedication
  • Acknowledgement
  • Abstract
  • Table of content

Chapter One

Introduction

  • 1.1 Background of the study
  • 1.2 Background history of the firm
  • 1.3 Statement of the problem
  • 1.4 Major Objective
  • 1.5 Research questions
  • 1.6 Hypotheses
  • 1.7 Significance of study
  • 1.8 Scope (delimitation) of the study
  • 1.9 Definition of terms

Chapter Two

Literature Review

  • 2.1 Conceptual Review
  • 2.1.1 Concept of sales promotion
  • 2.1.2 Trade Promotion Tools
  • 2.1.3 Customer Patronage
  • 2.1.4 Consumer Patronage Behvaiour
  • 2.1.5 Effects of Sales Promotions on Buying Behavior
  • 2.1.5.1 Coupons and consumer buying behavior during sales promotion
  • 2.1.5.2 Price discount and consumer buying behavior during sales promotion
  • 2.1.5.3 Free sample and consumer buying behavior during sales promotion
  • 2.2 Theoretical evidence
  • 2.2.1 Behavioral Learning Theory
  • 2.2.2 Contiguity Theory
  • 2.2.3 Classical Conditioning
  • 2.2.4 Operant Conditioning
  • 2.3 Empirical review
  • 2.4 Conceptual Framework
  • 2.5 Summary of Literature

Chapter Three:

Methodology

  • 3.0 Introduction
  • 3.1 Research design
  • 3.2 Study Population
  • 3.3 Sample Size and Sampling Procedures
  • 3.4 Data Collection Methods
  • 3.4.1 Interviews
  • 3.5 Data Collection Tools
  • 3.5.1 Questionnaires
  • 3.6 Validity and Reliability
  • 3.7 Data analysis
  • 3.7.1 Univariate Analysis
  • 3.7.2 Bivariate Analysis
  • 3.7.3. Multivariate Analysis
  • 3.8 Ethical consideration

Chapter Four:

Results And Discussion

  • 4.0 Introduction
  • 4.1 Univariate Analysis
  • 4.1.1 Characteristics of respondents
  • 4.2 Bivariate Analysis
  • 4.2.1 Relationship between coupons and consumer buying behavior during sales promotion
  • 4.2.2 Effect of price discount on the consumer buying behavior during sales promotion
  • 4.2.3 Relationship between free sample and consumer buying behavior during sales promotion
  • 4.3 Multivariate Analysis
  • 4.3.1 Impact of sales promotion on customer brand loyalty for breweries products

Chapter Five:

Summary, Conclusion And Recommendations

  • 5.1 Summary of Findings
  • 5.2 Conclusion
  • 5.3 Recommendations
  • References
  • Appendix A:
  • Questionnaire

Chapter One


1.0 Introduction

1.1 Background Of The Study

Promotion is an important aspect of marketing activity which has created a lot of impact through the use of some incentives, mostly designed to stimulate quicker or greater purchase of particulars products and services by consumer. In today’s marketing, organization are concerned on what should be done to advance sustained level of sales. This means give close attention to how consumers can be motivated through such means as rewards, incentives, leadership and Importantly satisfaction they derive from sales promotion. As a matter of facts, sales promotion is a vital factor in marketing and one of the important communication variables in the marketing mix.
Marketing managers often use sales promotion conjunction with advertising, personal selling and public relation to increase the effectiveness of their promotion efforts. Among all the elements that makes up the marketing mix, sales promotion is likely that most significance. It can be described as those short term incentives offered by the company to encourage the purchase or sales of a particular products.

According to Agbonifon BA etal (1999) sales promotion is a term used broadly to refer to those marketing activities, other than personal selling and publicity that stimulate consumer purchasing and deals effectiveness such as displays, shows and exhibitions, demonstrations and various non-recurrent selling efforts, not in the ordinary routine. However, based on recent development be it electronic, out door media like billboard usually placed on the side walks or the express ways, well posters, handbills and so forth have contributed a lot to the prevalence of lots of commercial slots usually either advertising some old or new in improved product or brands making announcement which seeks to draw public attention to some sales promotion currently going on and promoting mouth watering, exciting and highly fascinating prize and reward to be won by consumers who wish to participate.

The reason for the upsurge in sales promotion by most firms could be traced primarily to the depression in the Nigerian economy culminating in the adoption of the structural Adjustment programme (SAP) which was initiated in 1986 by General Babargida government with objective of

  1. Restructure and diversify the productive base of the economy so as to reduce depending on the oil sector and imports.
  2. Achieve fiscal and balance of payment viability over the medium term.
  3. Promotion non-inflationary economic growth

A major fall out form SAP is the prevailing a cute low consumer disposable income which has also manifested in very low patronage for with industrial and consumer product.

General, some people do have the impression that constant highly fascinating and beautifully packaged sales promotion exercises usually allow consumers to increase their trails of these bands, products or services and with services trails, there might be brand, product or services satisfaction and eventual conversion to that brand, product or services. To others the question of conversion does not arise because as far as they are concerned, the “ONLY” effect of sales promotion is the positive drive it exerts on the consumers initial purchases, which results in increase sales of brands, products and services. They further content that this effect on sales is vary transient, unending and will eventually and gradually fade out as soon as the sales promotion activities on the brands, goods and services are over. This study therefore emanated form the desire to find out which is the correct position of the effect and impact of sales promotion on consumers brand loyally using star lager beer and guineas extra smooth for the study.


1.2 Background History Of The Firm

The background history of star lager beer in Aba metropolis Abia state.

The star lager beer is a product of Nigerian breweries plc. It is the pioneer largest breweries company in Nigeria which was incorporated in 1946 and it recorded a land mark when the first bottle of STAE LGER BEER rolled off the bottling lines in its Lagos breweries in June 1946. this was followed by Aba brewery which was commissioned in 1957, Kadun|a brewery in 1963 and Ibadan brewery in 1982.

Star lager beer is the Nations favourite beer brewed with its special cold filtration process that brings you a million sparking golden bubbles every time enjoy. Their mission is to be the leading beverage company in Nigeria. The Nigeria breweries Plc has a rich portfolio of high quality brands star lager beer (1949), Gulder lager (1970) and maltina (1976) etc. RC: 613, IGANMU HOUSE, LAGOS. NIG. It contain ALC 5.1% vol and 60 cl.

The background history of Guinness extra smooth known as extra stout in Aba metropolis Abia state.
Guinness extra smooth known as foreign extra stout produces in year of 1759 at St. James gate dubline in Ireland. Originally brewed to a special recipe in 1759 by Arthur Guinness in Dublin. The Guinness is enjoyed by millions of people all over the world today.

The Guinness extra smooth contains the finest quality of barley, hope and malt. Its these wholesome natural ingredients which give Guinness its rich and satisfying good taste. The Guinness extra smooth contain ALC 7.5% Vol to 325ml.


1.3 Statement Of The Problem

This study set out to examine the impact of sales promotion on consumers brand loyalty using star lager beer and Guinness extra smooth consumers for the study. Sales promotion is one of the strategies that a firm can use to satisfy its market and improve its profits or maximize its profit. Through it helps a firm to advice its sales turnover, there are some problems that hamper its success in a firm.

Such problem are resources that will enable the firm to meet the needs of the chosen market.

Competition that exist in the chosen market can also constitute a problem to the firm.

Many business organization also lack the foreign in identifying the various need of consumers and difference that exist in there Market.

For a firm to succeed, it must have in depth knowledge of the market and must be ale to map strategies to satisfy the consumer of their product.


1.4 Major Objective

The main objective of the study is to examine the impact of sales promotion on customer brand loyalty for breweries products with a case study of Star lager beer and Guinness extra smooth in Aba, metropolis Abia states, Nigeria.

1.4.1 Specific Objectives
  1. To examine the relationship between coupons and consumer buying behavior during sales promotion.
  2. To find out the effect of price discount on the consumer buying behavior during sales promotion.
  3. To investigate the relationship between free sample and consumer buying behavior during sales promotion.

1.5 Research questions

  1. What is the relationship between coupons and consumer buying behavior during sales promotion?
  2. What is the effect of price discount on the consumer buying behavior during sales promotion?
  3. What is the relationship between free sample and consumer buying behavior during sales promotion?

1.6 Hypotheses

  1. There is a significant relationship between coupons and consumer buying behavior during sales promotion
  2. There is a significant relationship between price discount and consumer buying behavior during sales promotion
  3. There is a significant relationship between free sample and consumer buying behavior during sales promotion

1.7 Significance Of Study

This study is going to be of a great benefit to the following:

  1. Manufacturer/Sales person
  2. Consumer
  3. Policy maker
  4. The researcher
1. Manufacturer/Sales person:

It is going to be useful to them to know whether sales promotion activities have any impact in shifting consumer brand loyalty towards that particular brand, product. And also it will serve as a guide to the manufacturers and sales person in developing more skills in their business.

2. Consumer:

They are going to know while they should participate in the sales promotion of a particular brand, product and the benefit they are going to derive from participating.

3. Policy makers:

This study is relevant to economic policy maker in Nigeria to understand the tremendous impact of sales promotion in order to give adequate recognition on any decision they are going to make.

4. The researcher:

it will be useful to the researcher to know the impact of sales promotion and come to conclusion which strategy adopt to advices the corporate goals.


1.8 Scope (Delimitation) Of The Study

This research focused mainly on “Impact of a sales promotion on consumer brand loyalty using star lager beer and Guinness extra smooth. This was performed by administering questionnaires to consumers in Aba town of Abia state. Interviews sessions were also conducted with marketing and sales managers of the two manufacturing companies of Nigeria breweries Plc and Guinness Nigeria Plc.


1.9 Definition Of Terms

Brand:

Brand is a name, type, sign, symbol or design or a combination of them, intended to identify the goods or services of one seller or groups of sellers and to differentiate them from those of competitors.

Brand Loyalty:

Is deeply held commitment to re-buy or re-patronize a preferred product or service in future despite situational influences and marketing efforts having the potential to cause snitching behaviour.

Consumer:

Is a persons who buys goods or uses services. It can also be viewed as individuals who uses or buys a particular product for consumption. They are the last in the chain of distribution.

Competitions:

A situation which people or organization compete with each other for something that everyone can have.

Consumer goods:

Are those goods that directly satisfy human needs and desires. American marketing association defined consumer goods as goods destined for use by ultimate consumers or households and in such a form that they can be used without further processing.

Consumer Analysis:

Examine and evaluating consumers characteristics, needs and purchase processes and selecting the groups of consumers at which to aim market effort.

Consumer Education:

Is the process of informing or orienting guiding and instructing consumers or potential consumers in order to make intelligent or wise decision on the product or goods being marketed or sold to them.

Promotion:

Refers to series of related activities or function which are organized or integrated into programmes that enables the sales of product or services and which helps bring about increase in ales or turnover.

Promotion planning:

Communication with customers, the general public and others through some form of advert using, publicity, sales promotion, personnel selling and direct marketing.

Promotion Mix:

This are those elements or tools such as sales promotion, personnel selling, advertising, public relation etc. that are relevant in marketing or goods products and services which allows business firms and organization to communicate their intentions, purpose and marketing agencies etc. in order to ensure the survival, growth and stability of their business.

Questionnaire:

A written list of question distributed and answered by a number of people so that information can be collected for evaluation and decision making.


Chapter Five


Summary, Conclusion and Recommendations

5.1 Summary of Findings

Study results show that the majority of respondents were males (52 %). Furthermore, study results further show that the major of the respondents in this study were single (44%). Moreover, study results showed that the majority of the respondents had attained post-secondary education (50%). Additionally, the results of the study showed that the average age of the respondents that took part in this study was 32.44 years with the youngest respondents being 22 years and the oldest being 50 years.

Furthermore, Variance of Analysis (ANOVA) was run to find out the relationship between relationship between coupons, free sample, price discount and consumer buying behavior during sales promotion. Study results showed that the there is a significant relationship between the sales promotion and the coupons and free sample at 5 percent level of significance since the p-value is less than 0.05.

Additionally, the regression results also showed a statistically significant negative relationship at (at 5 percent level of significance) between the price discount and the sales promotion of Nigeria breweries in this study since its P-value is less than 0.05. The results were as postulated and this means that on average, a unit price discount leads to a 5.95 decrease in the discount and the sales promotion of Nigeria breweries when the other independent variables are held constant. Furthermore, the regression results also showed a statistically significant positive relationship at (at 5 percent level of significance) between the free sample and the sales promotion of Nigeria breweries in this study since its P-value is less than 0.05. The results were as postulated and this means that on average, a unit sample leads to a 080 decrease in the discount and the sales promotion of Nigeria breweries when the other independent variables are held constant.


5.2 Conclusion

The main objective of this study is to examine the impact of sales promotion on customer brand loyalty for breweries products with a case study of Star lager beer and Guinness extra smooth in Aba, metropolis Abia states, Nigeria. Variance of Analysis (ANOVA) was run to find out the relationship between Relationship between coupons, free sample, price discount and consumer buying behavior during sales promotion. Study results showed that the there is a significant relationship between the sales promotion and the coupons and free sample at 5 percent level of significance since the p-value is less than 0.05. On the other hand, the regression results also showed a statistically significant negative relationship at (at 5 percent level of significance) between the price discount and the sales promotion of Nigeria breweries in this study since its P-value is less than 0.05.

The results were as postulated and this means that on average, a unit price discount leads to a 5.95 decrease in the discount and the sales promotion of Nigeria breweries when the other independent variables are held constant. Furthermore, the regression results also showed a statistically significant positive relationship at (at 5 percent level of significance) between the free sample and the sales promotion of Nigeria breweries in this study since its P-value is less than 0.05. The results were as postulated and this means that on average, a unit sample leads to a 080 decrease in the discount and the sales promotion of Nigeria breweries when the other independent variables are held constant.


5.3 Recommendations

The research design in the birthday promotion controls the influence of third variables and thus should give answers about the influence of sales promotion. However, the fact that the birthday promotion was not promptly communicated to customers leaves the results unclear. Marketing communications about the promotion is suggested, after which a future study could be conducted. The topic of this research could also be studied by different research methods. A mixture of quantitative and qualitative methods could be used to tackle other parts of the theoretical framework. For example, customer attitudes towards credit card use could, in general, open opportunities to better understand consumer behavior. Also, once the promotional influence on behavior is analyzed, attitudinal factors could be identified and results linked together. That should give deeper understanding of consumer behavior and attitudes.

In addition to gender and age, other demographics could also be studied along with sales promotion to discover smaller customer segments receptive to this kind of promotion. If such segments were found, marketing efforts could be targeted to increase marketing efficiency. Any other marketing efforts could also be studied with appropriate measurement and segmented to get an idea of tactics that work for different segments.

In addition, sales promotions budget should always be adequate in organizations. This would also give sales representatives and consumers alike performance to participate.

Finally, there should be enhanced and computerized distribution system, this strategy creates performance and proficiency on field managers and supervisors monitoring sales on consumers and complaint.


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