THE EFFECT OF ADVERTISING ON SALES PERFORMANCE OF CONSUMER GOODS

THE EFFECT OF ADVERTISING ON SALES PERFORMANCE OF CONSUMER GOODS

Abstract

This study assesses the effect of advertising spend on Unilever Nigeria Plc’s sales and profitability. The study is based on secondary data gathered from the research firm’s annual reports and accounts on advertising spending, sales and profitability of Unilever Nigeria Plc from 1996 to 2009. The purpose of this study is, among other things, to assess the degree of advertising effectiveness on a company’s sales. This study employed a study design of correlation and regression analysis. The contribution of the first hypothesis establishes that advertising spend exhibits a significant relationship between advertising and company sales. Furthermore, the results of the second hypothesis showed that advertising did not significantly affect the company’s profitability. The study concluded that advertising is considered one of the most important communication media and influences company performance in multiple ways. However, its influential strategic importance may be tempered by other factors that seek the same attention when determining sales and profitability strategies. We recommend that you pay close attention to more than just advertising when developing a strategy for Other factors important to increasing sales and profitability include: Important promotions, personal sales, advertising, etc. should be considered.

chapter One

Foreword

1.1 Introduction

Marketing today is more than just having great products, attractive prices, and accessibility. Businesses and individuals also need to communicate with current and potential stakeholders and the general public. For most businesses and individuals, the question is not whether to communicate, but what, how, with whom and how often. But as more companies struggle to engage an increasingly fragmented consumer, communication becomes more difficult. To reach target markets and build brand equity, holistic marketers creatively employ multiple forms of advertising. In Nigeria, companies and individual service providers have been working for years to improve their advertising creativity in order to meet global standards and create the perception that their products are needed again.

1.2 Research Background

Advertising is a form of communication intended to persuade an audience, reader, or listener to take action. It usually includes the name of the product or service and how that product or service will benefit consumers by persuading potential consumers or customers to purchase or consume that particular brand. Modern advertising evolved with the advent of mass production in the late 19th and early 20th centuries.

Advertising can also be considered an element of a marketing communications program. Not only this, it’s usually the most important when it comes to building brand equity. The marketing communications mix consists of six primary communication channels.

1. Advertising:
Paid forms of impersonal presentations and promotion of ideas, goods, or services by a particular sponsor.

2. promotion:
Various short-term incentives to encourage product testing or purchase

1.6 Description of Hypotheses

Kerlinger F. (1976) defines a hypothesis as an putative statement about the relationship between two or more variables. A hypothesis is usually derived from a research question/problem and can be viewed as a preliminary solution to the research question. Therefore, the researchers test the following hypothesis.

Hypothesis I

Null Hypothesis (H0):
Advertising spend does not positively impact sales

Alternative hypothesis (H1):
Advertising spend has a positive impact on sales

Hypothesis I1

Null Hypothesis (H0):
Effective advertising has no positive impact on profits

Alternative hypothesis (H1):
Effective advertising has a positive impact on profits

1.7 Importance of research

This research paper has many significances, some of which are:

This research enhances and expands researchers’ knowledge and understanding of issues surrounding or related to advertising.
To provide information relevant to the management of the organization when making advertising-related decisions.
It helps you find solutions to all the problems that arise from bad advertising. 1.8 Research Basis

Investigative work is legally carried out for the following reasons:

Specifically, educate your advertising staff on how advertising actually impacts your company’s products, services, and sales.
It serves as a reference for academics/students willing to experience or increase their knowledge and insight into what the real impact of advertising is.
1.9 Scope of investigation

While the pervasiveness of advertising is well known, the purpose of this study is limited to examining the impact of advertising on Unilever Nigeria plc’s consumer goods sales performance.

Therefore, efforts are being made to find out whether Unilever Nigeria Plc’s advertising spending has a positive or negative impact on the organization’s revenues and profits. Researchers are trying to find out by looking at his 10-year track record with the organization. 1.10 Definition of terms

marketing:
This is the job of creating, promoting and offering goods and services to consumers and businesses.
product:
Anything that the market can offer to satisfy a desire or need.
Price/price:
This is the amount brought in or sold for the goods or services that the business has chosen as the final price from that price range.
communication:
The act of sending and receiving messages from people. This includes newspapers, magazines, radio, television, etc.
advertisement:
A form of communication intended to persuade a viewer, reader, or listener to take action on a product or service. strategy:
These are plans designed to help you reach your long-term goals and objectives.
sale:
This is the rate at which the goods are sold.
consumer:
The person who buys the product or service, i.e. the person who will end up using the product.
satisfaction:
It is a sense of accomplishment when using the product.
company:
This is called a company. That is, commerce.
management:
The act of managing (that is, planning, staffing, managing, etc.) all resources available to an organization in order to achieve company goals and objectives.