CHAPTER
1
INTRODUCTION
1.1
Background
of the Study
Every
organization must recognize that the success of any manufactured product or
service rendered depends on its level of acceptance in the market. The ever increasing product diversity and
competition on the market of goods and services has dictated the pace of growth
in the number of advertisements. Despite their admittedly diminished
effectiveness over the recent years, advertisements remain the favoured method
of sales promotion.
To endear a product to the consumer, many
organizations employ different effective marketing tools and promotional
strategies to enhance product acceptance. For a product to be accepted by the
public therefore, the marketing mix must be available – product, price, place
and promotion. This means that for a product to be successful, it needs the
right price, the correct strategies and the right promotional activities. Alide (2002) sees advertising as a concept
which can be defined as a form of communication through the media about
product, services, ideas, personalities or organizations, paid for by an
identified sponsor. Bovee and Arens
(2005) gave a more widely accepted definition of advertising as the
non-personal communication of information, usually paid for any usually
persuasive in nature about products (goods and services) or ideas by an
identified sponsor through various media. It is an exciting, dynamic, and
challenging enterprise. Its often a persuasive communication in that it tries
to persuade the reader, the listener or the viewer to take to the sponsor’s own
point of view and also to take some appropriate action. It is not personal or
face to face communication, rather it is directed to a group of people.
Advertising
is also controlled, identifiable information and persuasion by means of mass
communication media. Defined by Wrignt and Zeight (2002). Gillran Dyer says that
in its simplest sense, the word “advertising” means drawing attention to
something or notifying or informing somebody of something. On the other hand,
GSM stands for Global System for Mobile Communications. In Nigeria, GSM means
Telecom explosion. The GSM revolution began in August 2001 and changed the face
of Information and Communications Technology in Nigeria. Since the GSM launch,
mobile telephony has rapidly become the most popular method of voice
communication in Nigeria. Growth has been so rapid that Nigeria has been
rightly described in various for a as ‘one of the fastest growing GSM markets
in the world”.
Indeed
these developments have been truly explosive: according to statistics from the
Nigerian Communications Commission (NCC), compared with just about 450,000
working lines from NITEL in 2001, by August 2004, the GSM operators had
recorded over seven million subscribers. Expectations are that the figure
should rise to nine million by the end of 2004, due to massive expansion
programmes launched by the operators. As a result of this various Handset or
mobile phones are now available in the country with different size, face,
colour, facilities and cost.
One of
the tools that are available to manufacturers to crate awareness as well as
create product image in the minds of buyers and potential users is advertising.
The influence of advertising in the action consumer takes concerning a
particular product lies in the frequency of exposure to the message and the
usefulness of the product to the indentified needs of the would-be users.
Generally speaking, the role of advertising is to inform both loyal and
potential consumers of the benefit, function, and/or the price of the product;
to persuade consumers to buy the said product; and to remind those who are
already using the product of the existence of the product in the market.
Writing on the information function of advertising, Daiwan (2009) agrees that
the primary role of advertising is ‘to inform potential buyers of the
problem-solving utility of a firm’s market offering, with the objective of
developing consumer preferences for a particular product’.
The
concept of consumer preference comes even alive in the Nigerian
telecommunications industry which has been described has the “largest and
fastest growing in Africa and among the 10 fastest growing telecom markets in
the world” (Nwachukwu, 2013).B Analysis of the sector showed that operators of
the global system for mobile telecommunication (GSM) sector have a huge overall
control of the telecoms market, 118,470,236 active connections were recorded as
at the end of September 2013 from 113, 195, 95 as at December 2012. The MTN
Nigeria, Glo Mobile (Globacom), Etisalat Wireless and Airtel Nigeria in that
other rule the market. With this scenario, it is clear that the various network
providers would strive to outdo one another by attempting to position their
services ahead of others so as to become the biggest network with the largest
subscribers. According to Kotler (2001), promotion is designed to stimulate the
market, the trade, and the organization’s own sales force. To this end, the research intended to x-ray
the impact of advertising on the marketing Performance of GSM companies in Port
Harcourt.
1.2 Statement of
the Problem
In any competitive marking environment such as ours, a
marketing department/ term is often faced with the problems of how to determine
the measure of demand for its products in a given market segment, how to
determine the factors responsible for the variations in the demand pattern.
Many GSM service providers are faced with the problem of
not only identifying suitable strategies to bet their competitors but also how
to determine the strength of the contributions of various components of the
promotional mix variables especially advertisement to achieve the purpose of
stimulating demand of their product brand. This has equally led to high
budgetary allocation by the GSM service providers as they understand that
Nigerians are among the top users of mobile phone based on the population. However,
the study is to appraise the impact of advertising and Marketing performance of
GSM companies in Port Harcourt.
1.3
Purpose of the Study
The
study seeks to examine the advertising and Marketing performance of GSM
companies in Port Harcourt. The specific objectives are as follows:
1. To examine the association between Media and
Marketing performance of GSM companies in Port Harcourt.
2. To examine the association between Word of
Mouth and Marketing performance of GSM companies in Port Harcourt
1.4 Research
Questions
Here, certain
questions are raised; the provision of answers to them will be controlling the
idea of the research work. The questions pertain the crux of the matter and are
statements of major problems to be encountered as the progress is made on the
work. The questions, which are interdependent, include the following ones:
1.
To
what extent does Advertising Media affect marketing performance of GSM
companies in Port Harcourt?
2. To what extent does word of Mouth affects
marketing performance of GSM companies in Port Harcourt?
1.5 CONCEPTUAL FRAMEWORK OF ADVERTISING AND MARKETING PERFORMANCE OF GSM COMPANIES IN
PORT HARCOURT
SOURCE: (Researcher’s Desk 2015).
1.6 Research
Hypotheses
As contained in the statement of objectives, it is
logical to identify some relationship between different variables that now form
the bases of hypotheses of the study. In order to carry out this research, the
following hypothesis would be postulated:
Ho1: There
is no significant association between Advertising media and Sales Growth in GSM
companies in Port Harcourt.
Ho2:
There is no significant association between Word of Mouth and Market share in GSM companies in Port
Harcourt
Ho3: There is no significant association between
Advertising media and market share in GSM companies in Port Harcourt.
Ho4: There
is no significant association between Word of mouth and Sales Growth in GSM companies in Port
Harcourt
1.7 Significance
of the Study
This study will be of benefits and
interest not only to Accounting Firms in Nigeria, but it will be valuable to
other service sectors in Nigeria as a whole.
Advertisers: The study will be of importance to advertisers on the
need to improve sales through the use of advertisement technique.
Media: Mass media outfit will also benefit from the study to
know what the public is expected when advertising a product or service
GSM Producers: It is anticipated that results from this study will help
to evaluate and identify better ways of making GSM advertising and business
operations more effective.
General Public: At the end of this research, the public should be able
to identify good advertisement from one that is aim at deceiving them.
1.8 Scope of Study
The general
scope of this study covers Advertising and Marketing performance. The
geographical scope is Rivers State of Nigeria. The study will be carried out to examine (MTN, Etisalat, Airtel and
Globacom
1.9 Limitations
The drawbacks in the course of carrying out this study,
that could. limit the general applicability of the research, these hindrances
includes fund, time and other human material resources.
Material: At the time of gathering materials for this study there
was relatively little material.
Finance: There is no much found to travel to and browse online
for necessary materials
Time:
Available time for this study is relatively short compare to the task while
other academic activities also coincide to with the period of the project.
1.10
Definition of the Terms
Advertising: This is any paid form of non-personal presentation and
promotion of ideas, goods or services, by an identified sponsor, Adirika, Ebue,
Nnolim (2006:107).
Marketing: This can simply be referred to as the efforts by a
company to design and disseminate information about it’s terms and the benefits
to the target market, using different medium. Adirika, Ebue, Nnolim (2006:87).
GSM:
Global System for Mobile or mobile phone.