1.1 BACKGROUND OF THE STUDY
Promotion is an integrated and comprehensive terms, and covers the entire gamut of advertising, publicity, public relations, personal selling and sales promotion. In the present competitive world if any business organization has to survive it needs to keep an eye on various forces operating in the market.
Today, it would be difficult to find a company that does not proudly claim to be a customer-oriented, customer- focused, or even-customer driven enterprise. Increasing competition (whether for-profit or nonprofit) is forcing businesses to pay much more attention to satisfy customers. The state of satisfaction depends on a number of both psychological and physical variables, which correlate with satisfaction behaviors and by communicating values and innovative services of the company.
Strategy is the way, method, technique or plan which an individual or organization intends to exploit in achieving success in the marketplace or the society. Gleuck (1984) as cited in Achumba (2000:2) defines strategy as a unified, comprehensive and integrated plan relating the strategic advantage of the firm to the challenges of the environment. He added that organizations that desire not only to survive but also to improve their marketing effectiveness and efficiency must learn how to create and improve sound marketing strategy.
Sales promotions however, are marketing strategies companies use chiefly to increase sales temporarily to gain sales volume and market share (Lisa, 2009). They are occasionally used to clear out year-end inventory before new models arrive in showrooms as often done in the automobile industry. Sales promotions are also used as a competitive strategy to under-cut competition by offering a lower price or other incentive.
Although sales promotions usually produce sales volume over and above what is typically the case, they do not build brand identity and loyalty (Lisa, 2009).
Without mincing words, early trade by barter which involves exchanging of goods for goods reflected an economic situation in which most economies were called agrarian economies, which later matured into exchange economies. Emphasis then was on production which was then largely manual.
Marketing strategy draws its strength from the overall corporate strategy. It may be defined as those marketing programmes and tactics designed to achieve the objectives of an organization. A marketing strategy outlines the strategic direction and tactical plans that marketing teams must implement to support the company’s overall objectives (Ebitu, 2015: 278). strategy articulates the best uses of a business resources and tactics to achieve its marketing objectives. It states which opportunities are to be pursued by an organization, indicates the specific markets towards which activities are to be targeted, and identifies the types of competitive advantage that are to be developed and exploited (Weitz & Weasley, 1988 in Dibb, Simkin, Pride & Ferrel, 2006: 37)
SMEs in Akwa Ibom State find themselves in a competitive environment both locally and globally, hence effective marketing strategies are required to improve the business performances of the SMEs. This paper examines three marketing strategies (product quality, marketing communication and relationship marketing) and their impact on performance of SMEs in Akwa Ibom State.
1.2 Statement of the Problem
Recent economic depression no doubt has had significant effects on most organizations’ economic activities, among which decrease in sales (i.e. sales drop) stands out.
In some cases, there are no sales for a long period of time, which leads to closure or liquidation of such SMEs, since customers are unaware of the organization’s product offerings or home developed a strong habitual behavior on the use of a particular product thereby leading to the death of close substitute in the market place. The significance of sales promotion becomes unavailable.
In the face of all the strategies being used by an SMEs to achieve its goals and objectives, problems confronting the companies, as they do not operate in a vacuum, they operate in an environment which has its own effect on the performance of these organizations.
1.3 Objective of the Study
The specific objectives of the study which include;
1. To evaluate the influence of price discount on organizational profitability.
2. To examine the effect of bonus packs on organizational sales volume.
3. To examine the effect of jingles on consumer purchase decision.
4. To examine the perceived effect of low price on organizational performance.
1.4 Research Questions
1.Does price discount has any effect on organizational profitability?
2. Does sales bonus packs affect the organizational sales volume?
3. Can jingle influence consumer purchase decision?
4. Does perceived low price has any effect on organizational performance?
1.5 Research Hypothesis
There is no significant relationship between price discount and organizational profitability.
1. There is significant relationship between price discount and organizational performance.
2. There is no significant relationship between jingle influence consumer purchase decision.
3. There is no significant relationship between low price has any effect on organizational performance.
1.6 Scope of the study
This study is not an attempt to claim that sales promotion is the only marketing strategy that can be used by organization to increase their sales performance, rather it is only geared toward the successful application of sales promotion by consumer-oriented SMEs as a way forward to achieving their organizational goals and objectives. The study for reasons of limited resources and time constraints will be carried out using the selected SMEs in Akwa Ibom State
1.7 SIGNIFICANCE OF THE STUDY
The business of consumer-oriented organization is the provision of goods and services and thus existence. Therefore, it is the duty of this organization to determine how they are doing to motivate the consumers in the face of intense competition of various brands or related brands. The significance of a study of this nature is to find out if sales promotion can be an effective tool for a higher sales level; to create awareness about a new product to increase sales performance to stimulate demand and to convert potential buyer into actual buyers and if it can perform all listed functions, it is recommended.
1.8 Definition of terms
Consumer: A consumer is a person or group of people that are the final users of products and or services generated within a social system. A consumer may be a person or group, such as a household.
Decision: Decision can be regarded as the mental processes (cognitive process) resulting in the selection of a course of action among several alternative scenarios. Every decision making process produces a final choice.
Environment: Environmental (system), the surroundings of a physical system that may interact with the system by exchanging mass, energy, or other properties.
Influence: Influence is the action or process of producing effects on the actions, behavior, opinions, etc., of another or others.
Purchase: This refers to a business or organization attempting for acquiring goods or services to accomplish the goals of the enterprise.
Promotion: something devised to publicize or advertise a product, cause, institution, etc., as a brochure, free sample, poster, television or radio commercials, or personal appearance.