IMPACT OF PROMOTIONAL ACTIVITIES ON FAST MOVING CONSUMER GOODS (FMCG)

ABSTRACT

The study examined the impact of promotional activities on fast moving consumer goods (FMCG), a study of Unilever Nigeria Plc.

The sample frame of the study was made up of consumers of fast moving consumer goods resident in Ikeja, and the research was limited to age of 20 and above,

The simple random sampling technique method was use to pick the respondents and 400 consumers in Ikeja were selected, and a well- developed questionnaire was designed to elicit information from the respondents.

The data collected were analyzed using the descriptive statistics technique and the linear regression analysis was adopted to test the stated hypotheses at .05 significance level.

Result from the study indicated that there is strong relationship between promotional activities and FMCGs, there is strong relationship between improvement in promotion strategies on FMCGs and consumer referrals, and there is strong relationship between health labelling and consumers’ patronage.

Base on this, the study advised that FMCGs producing companies especially Unilever Nigeria Plc should ensure that they meticulously input expiry date on every product they are producing., secondly, it should be very careful of misleading advertisement which can take the interest of consumers away from the product., lastly, it should make sure the labeling of their products is healthy, along with expiration date, and NAFDAC registration number for authenticity should also be attached.

 

 

 

 

CHAPTER ONE

INTRODUCTION

1.1         Introduction

Modern marketing calls for more than developing a good product, pricing it attractively and making it accessible. Companies and individuals must also communicate with present and potential stakeholders, and the general public. For most companies and individuals, the question is not whether to communicate but rather what to say, how to say it, to whom and how often. But communication gets harder and harder as more and more companies clamour to grab the consumer’s increasingly divided attention. To reach target markets and build brand equity, holistic marketers are creatively employing multiple forms of promotions.

Sales promotion is an indirect form of marketing promotion intended to stimulate quick action. It is those promotional activities other than personal selling, advertising and publicity that stimulate consumer purchasing and dealers effectiveness such as displays, shows and exhibitions, demonstration, coupons, contests, samples, premiums, trade allowance, point of purchasing displays, price cent-off pack and dealer allowance and other known routine selling efforts that are usually of short term activities since the aim  is to move sales of a particular product or brand above the existing level. Sales would increase if more customers are attracted to the shop, if non-brand users are attracted and if brand users are encouraged to buy more.

According to Ebue (2000) “sales promotion is that something extra that can arouse interest, creating a buying desire, sparks an immediate reaction from customers, middlemen or company sales force.

According to Nnolim (1979) sales promotions is intended to aid both consumers pull and dealer push. They thus categorized sales promotions techniques in term of their consumer and dealer focus.

According to Kotler (2003) sales promotion, a key ingredient in marketing campaigns consists of a diverse collection of incentive tools, mostly short term design to stimulate quicker or greater purchase of particular products or services by consumers on the trade. Based on the sales promotion impact, the researcher used product life cycled theory.

Sales promotion holds a middle ground between advertising and personal selling. It is usually not directed as advertising but it is directed at much large groups than a typical personal selling effort.

Before the sixties, sales promotions had not become popular, but in recent years they had grown so rapidly between 1967 and 1976, and much more in the late eighties, nineties and beyond. In Nigeria over the years, companies and individual service providers have been trying to improve on the creativity in their promotion so as to meet world standards, and again, create the necessary awareness that a product needs.

1.2       Background of the Study    

Promotion is a form of communication intended to persuade its viewers, readers or listeners to take some action. It usually includes the name of a product or service and how that product or service could benefit the consumer, by persuading potential consumers and customers to purchase or to consume that particular brand. Modern promotion developed with the rise of mass production and increased competition in the late 19th and early 20th centuries.

Promotion could also be seen as an element of a marketing communications program. It is usually not the only one, or even the most important one, in terms of building brand equity. The promotion communication mix consists of six major modes of communication.

1.         Advertising:  Any paid form of non personal presentation and promotion of idea, goods or services by an identified sponsor.

2.         Sales promotion:  A variety of short term incentives to encourage trial or purchase of a product or service.

3.         Events and Experiences:  Company sponsored activities and programs designed to create daily or special brand-related interactions.

4.         Public Relation and Publicity:  A variety of programs designed to promote or protect a company’s image or its individual products.

5.         Direct Marketing:  Use of mail, telephone, fax, e-mail or internet to communicate directly with or solicit response or dialogue from specific customers and prospects.

6.         Personal Selling:  Face-to-face interaction with one or more prospective purchasers for the purpose of making presentations, answering questions and procuring orders.

The above listed are the elements of a promotion communication mix. A case study of Unilever Nigeria Plc was used to find out how the strategies employed help the company achieve its promotional goals.

1.3       Statement of the Problem

The purpose of this research work is to thoroughly evaluate the strategies and tools that companies employ to ensure promotion of their goods and services and, possibly, find out how that will commensurate with increased sales due to the use of the different tools. Inspite of the tight definition of sales promotion as an essential means of creating awareness of the product’s existence and characteristics and also the positive, psychological associations that can enhance the buyer satisfaction which add to the real value of the company's offering, little attention is being given to it by many business organisations in the country and they rarely promote their sales to the fullest.

Many firms pay little attention to sales promotion since they feel they can sell their product with little or no promotional activities. Likewise, despite the effects of sales promotion, there had been insufficient research and decision modeling devoted to it. In addition, there is an established negative perception of many firms as regards the cost of business promotion especially those whose benefits are not early and immediately reached.

Also, adequate records of sales and promotional cost are always neglected and some sales promotion programmes are introduced at the wrong time, which will therefore hinder the level of sales and profitability of the firm and thereby render sales promotions less important in the community and the country as a whole.

1.4       Objectives of the Study

The objectives of this research work are to:

  1. 1.      To find out the impact of promotional activities on fast moving consumer goods (FMCGs) of Unilever Nigeria plc products.
  2. 2.      To know the impact improvement of promotional strategies have on FMCG of Unilever Nigeria Plc products as a means of referral on various brand.
  3. 3.      To know the impact health Labeling of fast moving consumer goods (FMCGs) of Unilever Nigeria Plc products have on consumer patronage.
  4. 4.      To know how knowledge of expiration date on fast moving consumer goods (FMCGs) of Unilever Nigeria Plc products can improve consumer satisfaction.
  1.  

1.5       Research Questions

The following research questions have been developed

  1. What are the impact of promotional activities on fast moving consumer goods (FMCGs) of Unilever Nigeria plc products?
  2. What improvement will promotional strategies have on FMCG of Unilever Nigeria Plc products as a means of referral on various brand?
  3. Can health Labeling on fast moving consumer goods (FMCGs) of Unilever Nigeria Plc products Impact consumer patronage?
  4. How can the knowledge of expiration date on fast moving consumer goods (FMCGs) of Unilever Nigeria Plc products improve consumer satisfaction?

 

1.6       Statement of Hypothesis

Hypothesis One

H0: There is no significant impact of promotional activities on FCMG of Unilever Nigeria Plc products.

H1: There is significant impact of promotional activities on FMCGs of Unilever Nigeria Plc products.

 

Hypothesis Two

H0: There is no significant impact on the improvement on promotional strategies process as a means of referral from consumer in their various brands of FMCGs of Unilever Nigeria Plc products.

H1: There is significant impact on the improvement on promotional strategies as a means of referral from consumer in their various brands of FMCGs of Unilever Nigeria Plc products.

 

Hypothesis Three

H0:  Health Labeling has no significant impact on consumers’ patronage of FMCGs of Unilever Nigeria Plc products.

H1:  Health Labeling has significant impact on consumers’ patronage of FMCGs of Unilever Nigeria Plc products.

 

Hypothesis Four

H0:  Knowledge of expiration date of FMCGs of Unilever Nigeria Plc products has no significant impact on consumers’ patronage.

H1:  Knowledge of expiration date of FMCGs of Unilever Nigeria Plc products has significant impact on consumers’ patronage.

 

 

1.7       Significance of the Research Study

This research work has much significance but some of them are:

  1. This research work will improve and expand the knowledge and understanding of the researcher on issues surrounding or pertaining to promotion with regards to fcmg.
  2. It will provide relevant information for management of any organization in making decision related to promotion.
  3. It will help in seeking solution to all problems that arise from poor promotions of fcmg.
  4. It will educate, especially advert personnel on how adverts are really impacting to company’s goods and services, sales revenues.
  5. It will serve as reference material to any scholar/student who is willing to know or to add to his/her knowledge and insight of what the real impact of promotion is.

1.8       Scope of the Study

It is generally known that promotion covers a wide range area, but for the purpose of this research work, it will be limited to studying the strategies employed by Unilever Nigeria Plc in promoting its fcmg.

1.9       Definition of Terms

  1. SALES PROMOTION: Sales promotion can be defined as a broad label that applies special kinds of sales accelerating activity not necessarily classed as advertising and direct selling.
  2. BUSINESS: Business can simply be defined as the totality of all economic activities that are undertaken in the process of producing and distributing goods and services for the purpose of making profit.
  3. MARKETING: This is the task of creating, promoting, and delivery of goods and services to consumers and businesses.
  4. PRODUCT:  Anything that can be offered to a market to satisfy a want or need.
  5. PRICE/PRICING:  This is the amount of money for which goods or services is brought or sold, as selected by the company as final price from its range of prices.
  6. COMMUNICATION:  this is the act of delivering and receiving messages from people. This includes newspaper, magazine, radio, Television e.t.c.
  7. ADVERTISING:  A form of Communication intended to persuade its viewers, readers, or listeners to take some actions on a product or service.
  8. STRATEGY:  These are plans designed to achieve a long term aim and objectives.
  9. SALES TURNOVER:  This is the rate at which goods are sold.
  10. CONSUMER:  Is a person who buys goods or services that is, the final person who uses a product.
  11. SATISFACTION:  It is a feeling of fulfillment that is gotten from the use of a product.
  12. COMPANY:  This is referred to as a firm. That is, commercial business.
  13. MANAGEMENT:  An act of managing (i.e planning, staffing, controlling etc) all resources available to the business for the achievement of goal and objective of a company.

REFERENCES

Adebisi, Y (2006):  “Essential of Marketing Management” 1st ed., Lagos, Gilgal Publications.

Aluko, T (2001): “Principles and Practice of Marketing”. Lagos, Tunbuk Venture.

David, J (2006):  “Principles and practice of Marketing”. 4th ed., USA McGraw-Hills.

Ebue, B. C. (2000), Marketing Communications. Enugu: John Jacobs Classic Publishers Ltd.

Kotler, P and Keller, K (2003):  “Marketing Management”. 12th ed., New Jersey, Pearson Education, Inc.

Michael, J et al (2007):  “Marketing”. 4th ed., USA McGraw-Hills.

Nnolim. D.A.,(1979), "Marketing as a Tool for Economic Development with Special Reference to Nigeria," New Delhi: Vikas Publishing House.

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