Full Project – Sales promotion as a tool for improving sales in the beverages industry

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CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Sales Promotion has been considered as most stimulating technique of promotion for influencing purchasing decision. It is a valuable tool for manufacturers as well as retailers. According to survey of Cox Direct 20^th Annual Survey, 1998, 28 on Promotional Practices, suggest that many companies spend as much as 75% on Sales Promotion and 25% on advertising of their total promotional budget Dotson, M.J. and Hyatt, E.M.I (2000). There are various reasons for this distribution, among them quick sales generation is one. Sales Promotion includes those activities, which enhance and support mass selling and personal selling and which help compete and or coordinate the entire promotional mix and make the marketing mix more effective. Luick Zeigler, defines Sales Promotions as: “A range of marketing techniques designed within a strategic marketing framework, to add extra value to a product or service over and above the “normal” offering in order to achieve specific sales and marketing objectives, this extra value may be a short term tactical nature or it may be part of a longer-term franchise building program.”

Sales Promotion is a key ingredient in marketing campaign, it consists of divers collection of incentive tools, short term designed to stimulate quicker or greater purchase of a particular product or services by consumer or trader.

Sales Promotion offers incentives to buyers as it is now more acceptable by top management as effective sales tools. Product managers use Sales Promotion tools, on product as managers are under greater pressure to increase current sales. The significance of Sales Promotion in recent years and the tendency is that it is generally expected to continue. This is due to the fact that it stimulates consumers purchases, dealers effectiveness and loyalty.

Sales Promotion tools are used by most organizations, including manufacturers, distributors, retailers, trade associations and nonprofit institution. They are targeted toward final buyers (consumer promotion), business consumers (business promotion), and members of the sales force (sales force promotion), it is in view of this that the researcher intended to find out the effect of the sales promotion as a tools for improving sales in beverages industry with reference to 7up bottling company Plc.

1.2 STATEMENT OF PROBLEM

Sales Promotion cannot be carried out effectively and efficiently due to some problems such as cost; a lot of money needs to be spent on the process of implementing efficient Sales Promotion and also price the Sales Promotion activities may affect the price of the product but it reduces the company’s profit. It has been found that among the various promotional mix elements, Sales Promotion is the most stimulating variable for quick selling. (Scott, A., Nelsin (1998). There are various types of Sales Promotion tools used by the marketer but how to decide which of them can stimulate the purchase is difficult. An effort is made to know what can be best way to use the various tools of Sales Promotion.

1.3 OBJECTIVES OF THE STUDY

To find the impact of Sales Promotion tools on consumer purchasing decision.
To know the influence of Sales Promotion on consumers attitude towards new product and preference for the firms product
To know the image it creates for consumers for certain product in the industry.
To identify the contribution of Sales Promotion towards achieving maximum sales of the company’s product.

1.4 RESEARCH QUESTIONS

1. Do the Sales Promotion tools have significant impact on consumer

purchase decision?

Does Sales Promotion made by beverages industry influence the consumers positive attitude towards new product and preference for the firms product?
What image has Sales Promotion as a tool created in the consumers mind?
What contribution has Sales Promotion made towards sales performance of products that has been manufactured and marketed by the industry?

1.5 SIGNIFICANCE OF THE STUDY

The company could benefit from this study on how best they could plan and executes Sales Promotion to fight competition as well as solving the company problem on sales related matters.

The study’s findings will assist in formulating effective marketing mix such as Sale Promotion for their products with the aim of improving sales volume and market share.

It will expose to the industry, the image of her products generally in the market.

The significance of this study will also be of valuable reference and scholarly materials for future researchers on Sales Promotion.

1.6 SCOPE/LIMITATION OF THE STUDY

The scope of this study is to examine Sales Promotion as a tool for improving sales in beverages industries with 7up bottling Plc. Katsina depot as a case study. It focuses on how Sales Promotion motivates or induces customers towards the purchase of the products.

The study of course as expected could have gone through some few constraints, which are as follows:-

Time Factor:- The time given within which this research study is to be completed is very limited, because of some other administrative and class work that need to be attended to.

Financial Constraint:- Financial constraint is another problem which affect efficient research work.

Respondents bias:- Most of the company’s sales force shifted the interview date due to the nature of their job or they cannot give a accurate answer in order to finish the interview as quickly as possible.

Non-Cooperative:-the respondent because it believe a top secret information?

1.7 DEFINITION OF KEY TERMS

The following operational terms in this study are defined as follows:-

Promotion: this is the communication element of marketing which aims at telling the potential buyers that the products of the company are available and affordable to them and that they stand to benefit more in buying the company’s products than that of others. In a nutshell, it aims at inducing trial for non-users and encouraging current users to not only remain loyal users but also to even increase their rate of usage (Nwaizugbo, 2004).

Sales Promotion:- Sales Promotion is the activity that offer an incentive for a limited period to induce a desired response from target customers.

Sales:- Refers to the exchange of goods and services for money. It is also all the activities involved in selling of goods and services.

Beverages:_ A liquid to consumer, usually excluding water; a drink. This may include soft drinks, tea, juice etc.

Industry:- Industry refers to a group of firms specially in the production of some nearly or similar goods. It is also the sector of the economy consisting of large-scale enterprises.

1.8 STATEMENT OF HYPOTHESIS

Hi -Sales Promotion has significant impact on improving beverages sales

Ho-Sales Promotion does not have significant impact on improving beverages sales

1.9 RESEARCH METHODOLOGY

Much of the information used in this work will be obtained through multiple survey research methodology which includes review of published related literature, analysis of official records such as local government estimate development plans, organizational chart, journals, articles, and questionnaires distributed.

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Full Project – Sales promotion as a tool for improving sales in the beverages industry

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Full Project – Sales promotion as a tool for improving sales in the beverages industry

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