Impact Of Sales Promotion On The Marketing Of Soft Drinks

Project and Seminar Material for Marketing

Impact Of Sales Promotion On The Marketing Of Soft Drinks


Abstract


The main objective of this project was to determine the extent to which sales promotion is understood, accepted and adopted by 7-up bottling company, Benin City. In conducting the research, information was gathered from secondary source like books and journals. Personal interviews and questionnaire were also used as primary sources. The researcher observed that sales promotion stimulates consumers to buy more and that sales promotion also have a positive impact on the sales of 7-up products. The researcher concluded that, sales promotion is very important in any manufacturing company that is interested in expanding its existing market share. It was therefore recommended that the company should allocate enough funds for the execution of sales promotion programme because of its relative importance in terms of increase in sales volume and profits and that sales promotion should not be regarded as an emergency tool but as integral part of the company’s marketing effort.


Chapter One


1.0 Introduction

1.1 Background to the Study

Promotional strategies in marketing theory and practice have over the years been concentrated on advertising, personal selling and publicity campaigns. The degree of competition in the business environment usually dictate the type and sophistication of promotional strategies. When sales growth appear stagnant or product gets to its maturity stage, the best promotional option is need for soft drink industries to adopt promotional strategies for the purpose of winning their target buyer and the public through the process of communicating information with the aim of persuading, convincing and possibly changing their attitudes and behaviors.

At the stage of maturity sales are best stimulated through free gifts and assistance to middlemen and final consumers. This promotional technique has been widely adopted by marketers in various industries, especially the breweries. In this project, effort will be made to find out the impact of sales promotional strategies on the marketing of soft drinks using seven-up bottling company Benin City as case study.


1.2 Statement of Research Problem

Nigeria market is essentially a “sellers market”, where intense competitions is on between indigenous and foreign producers of goods and services. Each participant in the competition helps struggling not only to maintain but to expand it existing market share. Different techniques and advise had been employed to indicate sales promotion at the expertise of competitors. The Nigeria media both the point and electronic carry on daily basis different forms of advertisement, sales promotion and other products. In addition certain economics incentives are also introduced to the induce patronage.

However the extent to which these varied techniques yield customer patronage and increase sales volume is unknown. Although the manufacturing organization have greatly benefited. Through such marketing campaigns there is the need to establish the most induces customer patronage as well as increase in sales volume. The main techniques employed in this study include sampling, purchases, exhibition and specialties.

It is hoped that this study will reveal a lot in sales promotion techniques in terms of the most effective strategy to adopt by many organization.


1.3 Objectives of the Study

The study on the impact of sales promotion in the marketing of soft drinks in seven-up bottling company Nigeria plc aims at achieving the following specific objectives.

  1. To examine the impact of sales promotion on sales volume.
  2. To investigate sales promotion, is very effective in building image and good will of the company.
  3. To examine the rational and investigate the problem associated with sales promotion.
  4. To investigate new sales promotion activities are carried out with a particular reference to the sales of soft drinks.
  5. To determine the effect of sales promotion on turn over.

1.4 Research Questions / Hypotheses Statements

Following hypotheses in order to obtain necessary information, the following hypotheses have been formulated

Hypothesis One
  • HO: Sales promotion does not stimulate consumers to buy more.
  • HI: Sales promotion stimulates consumers to buy more.
Hypothesis Two
  • HO: Sales promotion has negative impact on the sales of 7up products.
  • HI: Sales promotion has positive impact on the sales of 7up products.
Hypothesis Three
  • HO: Sales promotion does not enhance consumer loyalty.
  • HI: Sales production enhances consumer loyalty.

1.5 Significance of the Study

Most manufacturing companies in Nigeria have been experiencing instability generally in their sales. This has been altitude mostly to the present state of the nation’s economy and partially, of course, to either ineffective sales promotion or most of these companies the overriding motivation which influences manufacturing industries to use sales promotion must be to maximize profit, achieve greater market share, create awareness of the existence of the company and equally increases sales volume. Considering the above therefore, the significance of the study is in the fact that it will be a valuable reference scholarly material for seven-up bottling company and the entire soft drinks industries, as it is aimed at finding the effectiveness of the various sales promotion schemes in the industry with particularly emphasis on Seven-Up Bottling Company (SUBCO) experience.

The study also enables the researcher to know more about soft drinks industry particularly its promotional activities.

It will also enable the present and prospective researchers and employees of the company to know more about soft drink industry and its campaign.


1.6 Scope of the Study

The project examines the impact of sales promotion in the marketing of soft drink with special emphasis on bottling company Benin-City.

The study does not go into the administrative and financial aspect of the company but only limited to finding out the impact of sales promotion in the marketing of their products.


1.7 Limitations of the Study

It is not easy to source for relevant materials put together for the study. This is as a result of acute shortage of up-to-date textbooks and magazines in the school library. In carrying out the research, the researcher may face the problem of frequent travel to get necessary materials.

Finance may be another problem. The time for the research study is also very limited because other administration and class work activities some of the respondents in providing appropriate answers to the questions.


1.8 Operational Definition of Terms

The following essential terms used in this study are defined below:

Promotion:

This encompasses all the tests in the marketing mix whose major role is persuasive communication.

Advertising:

This is any paid form of non personal presentation and promotion of ideas, goods and services, events, opinions by an identified sponsor.

Personal Selling:

This is a face to face interview between the sales representative and the customers. It means oral presentation in a conversation with one or more perspective purchases for the purpose of making sales.

Publicity:

Non personal stimulation of demand for a product, services or business unit by planning commercially significance news about it and a publish medium or obtaining favourable presentation of it upon radio, television or stage that is not paid for by sponsor.

Sales Promotion:

This comprises of those marketing activities other than personal selling, advertising and publicity that are designed to stimulate consumer purchasing and dealer effectiveness, such as displays, shows and exhibitions, demonstrations and various non-current efforts and not in the ordinary routine.

Sales Analysis:

This involve examining sales reports to see what goods and services have and have not sold well. The analysis is used to determine how to stock inventory, how to measure the effectiveness of a sales force, how to set manufacturing capacity and to see how to see how to set manufacturing capacity and to see how the company is performing against its goals.

Sales Resistance:

This is the resistance by potential customers to aggressive selling practices.

Sales Talk:

This is a line of reasoning or argument by a seller to persuade a buyer to buy its company’s product or services.

Facilitators:

These are those items that helps to remove risk or burden on the part of the buyer example, a guarantee.

Selling Offer:

This refers to the benefits associated with the purchase of a given product to buyers.

Prospects:

This simply means potential buyer or buyers.

Respondents:

This means the person or prospects to whom a selling offer is being made.

Response:

This refers to likely reaction of the respondents to whom a selling offer is being made.

Market Share:

The percentage measure of the share obtained by an individual company from the industrial sales.


Chapter Five


Summary of Findings, Conclusion and Recommendations

5.1 Summary of Findings

Based on the analysis, it was observed from Hypothesis I question 9 in the questionnaires that majority of the respondents accepted that adequate sales promotion resulted in high sales volume. It was also found from Hypothesis II in question 8 of questionnaire that 15 responding representing 75% of the total population feels that sales promotions help to motivate consumers more, 4 respondents making up 20% recorded small extent. While it was also discovered that 1 respondent representing 5% of the total population recorded that sales promotion motivate consumer.

It was observed from the questionnaire administered that out of the total population, the majority of the respondent agreed that sales promotion has a positive impact on the sales of 7 up products.

It was also discovered that from the total population, 20 respondents representing 100% say that the company considers their competitors before embarking on their sales promotion.


5.2 Conclusion

The research study showed that sales promotion produces a high sales responses shown by the significant difference between the level of consumption before and during the promotion as shown when chi-square techniques is used on the sales figures in hypothesis II.

The study also showed that high response to sales promotion is not maintained at the expiration of the promotions.
There is no significant differences in the level of consumption before and after any of the sales promotion as shown by the data analysis.


5.3 Recommendations

The company should embark on sales promotion as one of the promo tools to achieve its cooperate goals.

The company should improve on the quality of its products to differentiate it from other products of the competitors and used sales promotion to enhance its competitive advantage and to increase its profitability.

The study also suggests that sales promotion should be done at the appropriate time with regards to availability of products and funds.

The study also recommended that adequate budget should be made available. The study also recommended that adequate planning should be made as to whether the external environment of the business is favourable before sales promotion is carried out.

Sales promotion budget should be prepared in such a way that will be suitable for the organization that is applying it.


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