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DEPARTMENT OF ECONOMICS

INTRODUCTION

Advertising is any paid form of non personal presentation and promotion of ideas, goods, or services by an identified sponsor (Kotler and Armstrong, 2010). There are various forms of advertising like informative advertising, persuasive advertising, comparison advertising, and reminder advertising. Informative advertising is used to inform consumers about a new product, service or future or build primary demand. It describes available products and services, corrects false impressions and builds the image of the company, (Kotler, 2010).Advertising can be done through print media which includes news papers ,magazines ,brochures ,Audio media for example Radio, and visual media which includes billboards, and television (Kotler and Armstrong 2010). Mukwano advertises using visual media for example the television and the Audio the radio, print media for example the newspapers. Mukwano has launched a new detergent powder to compete in East Africa common market through intensive advertising internationally Daily monitor April 2010, but there are some inefficiencies in the way these organization carries out its advertisements for example Mukwano advertisements in the visual media is done in local language i.e. (luganda) a language that can only be understood by a few people in the country, making the advertisement appealing only to a group of people. The advertisements lacks the unique selling proposition in the statements used to differentiate their products from competitors, they are done in the same way as the competitors making it hard to differentiate its ads from others. Besides their advertisements dont provide room for further information about their product for clarification (Daily Monitor April 2010). A significant event in the development of advertising was the invention of a system of casting moveable type by the German, Johannes Gutenberg in 1938. The event revolutionized communication methods for the whole world. (Keller 2005)
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DEPARTMENT OF ECONOMICS

In a sense, one can say that advertising just like other disciplines came via our colonial master. However, this is not to conclude that we did not have some form of traditional advertisements before the arrival of the colonialist, there were e.g. town criers used by the king in the delivery messages, in the past. For a message to go across to the members of the public a town crier was sent out to do so. (Arowomole 2002) Advertising is the non-personal communication of information usually paid for and usually persuasive in nature, about product, services or ideas by an identified sponsor through the various media. So much for academic double talk. Lets take this statement apart and see what it means. (Tuflinger 1996). Profitability of a business is the justification of good performance. He further says that, profits of a business are the end results of operations and an indicator of good performance. Therefore, profit is a basic yardstick with which the success of the business can be measured. It is a reward for enterprise innovation and taking risks. (Griffith 2001)

SIGNIFICANCE OF THE STUDY


The findings of the study were expected to benefit the following. The findings of the study were used as references for future research work. The results of the study are of surmountable information when drawing measures which would in turn lead to capture of substantial market share. The study can be the source of reference on how to revive and adopt and also follow the adverts according to the dynamic markets. Advertising campaigns have three main characteristics; Meaningful, they should point out benefits that make the product more meaningful to the customers.

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Believable, customers must believe that the product or service will deliver the promised targets. Distinctive; be able to tell how the product is better than competing brands

OBJECTIVES OF THE STUDY


1. 2. 3. To examine the forms of advertising in Mukwano industry. To establish the level of sales performance in Mukwano industry To establish the relationship between advertising and sales in Mukwano industry

ORGANIZATION OF THE STUDY


This paper is divided into five sections, one consist of the introduction while section two the literature review. The methodology is in section three. The conclusion taken care of in section four. The fifth section consist of recommendation.

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DEPARTMENT OF ECONOMICS

LITERATURE REVIEW

According to Philip Kotler and Garry Armstrong advertising is any paid form of nonpersonal presentation and promotion of ideas and goods, or services by an identified sponsor (Kotler and Arm strong 2010) .although advertising is used mostly by commercial firms, it is also used by a wide range of nonprofit organizations, professionals and social agencies that advertise their causes to various target publics. Arens 1986 states that advertising is a non-personal communication of information usually paid for and persuasive in nature about products, services or new ideas by identified sponsors through various media. Kotler and Armstrong, 1999 argued that there are various forms of advertising that is informative, persuasive and reminder advertising. Informative advertising is used to inform the customers about a new product or feature and to build the image of the company. Kotler and Armstrong further highlight the steps considered when setting the advertising budget .stage in product life cycle, new products typically need large advertising budgets to build awareness and to gain customer trail. Mature brands usually require lower budgets as a ratio to sales. According to David et al 1988, effective advertising decisions are aimed at supporting the marketing strategy for a companys products and also influences purchase decision. The first step in creating effective advertisement messages is to decide what general messages will be communicated to consumers. This involves developing an effective message strategy that begins with identifying customer benefits which can be used as advertising appeals. You can then create a compelling idea or concept that brings the message strategy to life in a

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DEPARTMENT OF ECONOMICS

distinctive and memorable way. This in turn guides the choice of appeals to be used in an advertising campaign. Kotler and Armstrong states that the only reason for advertising is to sell something that is product, service or even an idea (William J.s et al 1998). Many companies used straight forward method in determining advertising applications like percentage of sales, standard expenditure per unit, the task method / market share relations between advertising and sales revenue since there are mainly other factors that determine the sales revenue of a company like price, perception towards the product. According to Michael D, 2006 Sales performance is an integrated frame work that enables organizations to plan and model sales strategies and ensure timely execution of sales initiatives while ensuring both front line sales people and decisions-markers have visibility into performance . Sales performance represents the next generation of best practices for sales. Wood, 1996 states that sales performance also refers to the total amount of firms output sold to the market especially on monthly or annually basis .this is affected by many factors including customer relationship, marketing management of the firm and sales force skills and motivation and even the pricing of the goods and Sales revenue is the total amount of money that the firm gets from the sale of all its goods and services in a given period of time. This is usually six months or a year if a firm produced only one product or service, the sales revenue will be the price of the product multiplied by the number of products sold. In the case of more than one product or service the revenue from each needs to be added together. Baker 2001 argued that the sales revenue in profit and less account does not necessarily mean that the firm has received all the money because although they may have sold that quantity of the product, they may still be owed some of the money as debtor. Stein 2006 believed that the right sales approach consists of sales training that supports a companys sales methodology and related processes.

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DEPARTMENT OF ECONOMICS

According to Stain 2006 In the past years some organizations have found that their sales process are becoming more challenging while the performance of some of their sales professional who were past stars are deteriorated. Selling complex products and services, versus selling commodities has always been more difficult and sales professionals must have different skill sets. Verret, 2004 believes In dealing with falling or declining sales, it is advisable to invest in some short term training to upgrade the skills of sales and customer service staff. If you cannot afford to fire experience, train the staff you can afford. This is an investment you cannot afford to miss. Find training that produces results tailored to get to your situation. It can be seminars or distance learning that does not require time away from the property or the job. Hardesty 2006 states that Sales training programs encompass a variety of necessary components, things like company policies, sales paper work, customer relationship management, sales force automation orientation, sales processes, company services, sales skill training and product features and benefits. stein 2006 further urges that , even when companies do decide that sales training is a step in the right direction, they do not always proceed forward for the right reasons in the right order ,or in a way that results in them, driving more sales revenue companies have learned how to employ sales training as a strategic tool. Dvora ,2008 states that A sales process is a systematic approach involving a series of steps that enables a sales force to close more deals, increase margins and make more sales through referrals. Actively using and desire to become willing to implement a sales process could lead to more sales. Normally a sales process involves the following key steps; prospecting qualifying , proposal /presentation, handling objections ,closing sale and follow-up for repeat business referrals

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DEPARTMENT OF ECONOMICS

According to Vakratsas and Ambler, the outcome of a sales process can be explained by a series of steps that are systematic and not haphazard. Random acts produce random and uncertain results. In sales, random acts can be used occasionally, but systematic and well defined best practices can assure predictable results.

Relationship between advertising and sales performance


According to Engel 1991, mc Gann and Russell, 1998 ,It is through advertising or other forms of promotion that brands in different market segments can effectively tell people in the market that a product is intended specially for them. Pride et al 1989 believes that the significance of advertising is to let customers know that an established brand is still around and it has certain characteristics, uses and benefits. Gordon 1993 states that Companies advertise in order to compete in a new and aggressive way with in the marker, to increase their market share through increased customer, utilize the low cost way of teaching customers to create marketing approaches. David et al 1988 believes that Many scholars have heard different views on the effect of advertising on sales performance .however most of them agree that effective advertising will eventually increase revenue.

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METHODOLOGY

Research Design
The researcher used a cross sectional research design with both qualitative and quantitative methods .The design was appropriate in investigating the empirical and theoretical relationship between the variables.

Sampling Design
According to Krejki and Morgan (1970), the sample size used was 40 respondents and was determined where the sample size was determined basing on confidence level needed from the selected population under study. Sampling method The research used stratified random sampling to divide the employees into different departments under which they worked which included operational, supply, production and marketing departments. Simple random sampling method was used to select respondents from the selected departments in the industry, where by from the marketing department 16 employees were chosen, from production we had 8 respondents, from supply department 8 responds were chosen and finally 8 respondents were selected from production department.

SOURCE OF DATA

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DEPARTMENT OF ECONOMICS

Primary data This data was obtained from the source. This was used where one required specific information which does not exist elsewhere or in another form or when the topic was being researched on for the first time. The researcher collected primary data through going to the field. Secondary data Secondary data was the one obtained from sources which already exist about organization and had been used before, for example information from journals, books and internet. The researcher collected information.

Limitation of the study.


1. The researcher found difficulties in collecting data because some of the respondents

were not cooperative and willing to give out the information the researcher needed. 2. Attitude was studied from the view point of the employees, thus did not reveal the

exact consumer attitude. 3. The researcher had tough time in collecting information about the sales performance

because the information was valued confidential and therefore they were not willing to disclose the information.

Findings on the relationship between advertising and sales performance using Pearson correlation

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DEPARTMENT OF ECONOMICS

This section focuses on establishing the relationship that exists between advertising of products and sales performance. It looks at advertising as independent variable while sales performance is a dependent variable. The selections tested to select the relationship are the respondents. Perception relating to advertising in the company table 9 and their perceptions on how advertising increases the number of products bought. The Pearsons rank correlation co efficiency is provided in the following formula. R = n xy xy nx- (x) n y-(y) Where r =Pearsons correlation co efficiency and n= Frequency.

MODEL
A company sponsors advertising in order to convince and influence people to buy its products. All these can be shown in model:

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Model of Advertising (Osuagwu (Linus) 1997, 185)

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CONCLUSION

Forms of advertising
From the finding of the study, it is evident that there are various forms of advertisements used by the organization. But according to the responses there are some forms which are mostly used than others, this includes radios and televisions. These have helped the organization to raise awareness about the existence of various types of products produced by the company.

Establishing the level of sales from Mukwano industry


The level of sales in Mukwano is declining as indicated in table number 23 where by 37.7% of the respondents agreed that the sales level in Mukwano is declining. In the year 2007 the industry recorded the highest sales volume but as the years went on the sales started declining.

Relationship between advertising and sales


The relationship between advertising and sales is very strong. This is shown by person correlation analysis(r=0.9) supported by the responses from the questionnaires. Where most of the respondents agreed that the media used reach the intended audience

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DEPARTMENT OF ECONOMICS

RECOMMENDATION

Mukwano industry should use other forms of adverting like sponsoring events and use of mobile phone advertising. This will increase awareness about the various products produced by the industry. The industry should choose the most effective media for advertising. A media that is affordable by many people for example radios. The industry should use different common local languages used in the country so that every individual can get the messages from the adverts. E-marketing should also be used to reach most the people who spend time on the internet and have no timer to listen to radios or watch televisions. The industry should also use celebrities in the country to help them advertise their products for this can attract big crowds from which potential customers can be found.

Suggested areas for further research.


Due to limited time, this research is not conclusive as such. It is therefore important that further research be carried out on the following. 1. 2. 3. Employees motivation and sales performance Effects of e-marketing on sales volume Impacts of employees training on sales

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DEPARTMENT OF ECONOMICS

REFERENCES

[Arm strong, M (1999)]\ Human resource management practice. [Dunban, D,s (1968)]\ The politics of the economics of advertising. journal of advertising research foundation. [Wood, F (1994)]\ Business accounting. [Gilson , C and Beckam, H (1988)]\ Advertising 2nd edition Jefkins, F (1990) ; Introduction to marketing , advertising and public relations( third edition) Macmillan education ltd. Kotler P and Armstrong,G (2000) ; principles of marketing (12th edition). prentice Hall of India. Kotler , P, (1988) ; marketing management prentice hall international inc. Lester ,J D(1993) ; writing research papers . a complete guide (7th edition).New York , NY, Harper Collins college. Internet www.mukwano.co.ug. www.wikipedia.org/wiki/advertising. Sakaran , U (2000) Research methods for business (first edition) Vakratsas .i Ambler G. (1999) ; sales performance management(3rd edition) Prentice hall international inc. Pride , F et all (1989) ; marketing concept and strategies (sixth edition ) Boston Houghton miffing company.

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