THE IMPACT OF PRODUCT ADVERTISEMENT ON SALES VOLUME OF COMPANIES

 

CHAPTER ONE

 

INTRODUCTION

 

1.1  BACKGROUND OF THE STUDY

One of the four promotional strategies used by businesses to target customers and the general public with persuasive messages is advertising. Advertising strategy plays such a crucial role in business marketing plans that organizations risk failing if it is neglected.

In general, businesses exist to create and sell items. If the general public is not made aware of the created goods, these objectives cannot be achieved. Consumers and the general public will avoid certain products if they are not informed and educated about the requirements and wants that some products may fulfill.

In light of this, product advertising places a strong emphasis on conveying the image and marketability of goods in a way that will make them appealing to customers and buyers.

When he emphasized that the expansion being seen in the advertising industry is connected with its capability to increase the acceptance marketability of companies’ products, Odunsi (1998: 19) emphasized the significance of product advertising.

Many businesses have been able to resurrect and reposition some of their products that are practically at the decline stage of their life cycles thanks to product advertising.

The performance of their products and the level of their sales volume also play a role in the ongoing survival and expansion of businesses. The truth is that a company’s sales volume must be strong in order for it to decline profit and maybe grow. Its items must be well-received by consumers in order for its sales volume to be large and to meet their high demand. This can only be accomplished when these products are advertised to potential customers.

According to Ebue (2000.75), product advertising is a powerful promotional technique that not only informs and educates consumers about a company’s products but also plays a key role in helping the company reach its desired sales volume.

For over fifty (50) years of existence, Nigerian breweries Plc is one of the leading breweries operating in Nigeria today. The company has a wide range of products that includes alcoholic, malt and soft drinks. The notable products in the company’s product mix includes; Golder, star, Amstel malt, maltina, Legend and schepps. The company has a large factory at Agbara, Lagos and a brewery plant at 9th Mile Corner, Ngwo, Enugu. the Company again commissioned its new Ultra – modern brewery in Ama Enugu State in  October 27th 2003, by his excellence president Olusegun Obasanjo.

The Nigerian breweries Plc has depot in most state capitals of the federal to facilitate the distribution of its products. The products of the company are seen and known in every nook and cranny of the southern parts of this country as well as some Northern States.

According to the Saturday Champion paper May 1st (2004); Nigerian brewing is totally committed to Nigeria cause in areas of Entertainment through a vigorous music sponsorship programme which has brought International Stars like Naught by Nature, Usher, Shaggy  and Awilo that have thrilled Nigerians live in recent times courtesy of Nigerian Breweries Star Mega Jam and Legend fun Rampnage. Nigeria Breweries is also involve in discovering and promoting local and budding artists through the star Quest and Star Trek (Star sponsored music programmes.

Foreign Investment;  Nigeria Breweries has through their performance attracted some foreign companies like Heineken which invested over 500 millions Euros (70 million).

The business has provided support to universities. For instance, IMT is one of the beneficiaries of the education tax monies.

The main agents in the establishment of a sickle cell foundation are Nigeria Breweries. Again, they provide equipment for blood banks and child incubators as donations to support various medical institutions.

Also, they have supported activities including table tennis, lawn tennis, chess, golf, cycling, and athletics. They are also dedicated to social responsibility, the environment, creating jobs, and other areas. All of these things are done to market their products, tell the public about them, educate them, and ultimately reach their sales volume goal.

1.2  STATEMENT OF THE PROBLEM

The business has provided support to universities. For instance, IMT is one of the beneficiaries of the education tax monies.

The main agents in the establishment of a sickle cell foundation are Nigeria Breweries. Again, they provide equipment for blood banks and child incubators as donations to support various medical institutions.

Also, they have supported activities including table tennis, lawn tennis, chess, golf, cycling, and athletics. They are also dedicated to social responsibility, the environment, creating jobs, and other areas. All of these things are done to market their products, tell the public about them, educate them, and ultimately reach their sales volume goal

a few issues that require attention.

According to reports, the majority of businesses in Nigeria are still unwilling and rigid about how they choose to conduct their advertising. They fail to hit their sales volume goal because they are so afraid of hiring an advertising agency to handle their advertisements.

Also, the majority of businesses have conflicting advertising policies. At any given time, they employ more than one advertising agency.

It is tough because of this to invest some money on advertising. This is becoming a typical characteristic in the brewery sector. For instance, advertisements for venerable goods like Maltex and Vita Malt are rare. This ought to have an impact on their sales volume.  This should be affecting their sales volume target.

Finally, the product advertising policy of some companies are not so effective as to enable us have some impact on their sales volume. Some companies do choose some wrong and ineffective media to execute their advertising policy, hence achieving nothing at the end of the day.

All these above discussed problems deserve to be addressed through the provision of appropriate information, because it is only when effective information concerning a problem is provided will its solution be sought.

1.3  OBJECTIVE OF THE STUDY

Examining the key impacts and the function of product advertising on sales volume is the study’s main goal. The study’s further operational goals include the following:

i.   To determine the most typical type of advertising utilized by the brewery sector.
ii.  To determine the most popular advertising channels employed in the beer sector.
iii.  To determine the breweries’ level of dedication to marketing their goods.
iv.  To investigate how product promotion affects consumers’ purchasing behavior.
v.  To investigate the impact of product advertising on the expansion and success of brewing businesses.
vi.  To investigate the value of product advertising in a product’s performance and survival.
vii.  To pinpoint specific issues impeding the successful deployment of product promotion in brewing companies 

1.4   RESEARCH HYPOTHESIS

In this investigation, the following research-formulated hypothesis will be put to the test:

I. Ho; The determination of sales volume is not significantly influenced by product advertising.
Hi; Determining sales volume requires consideration of product advertising.
ii. Ho; A company’s degree of profitability cannot be significantly increased by effective product advertising.
Hi; A company’s profitability level might grow significantly as a result of effective product advertising.

1.5   SIGNIFICANCE OF THE STUDY

As was said previously in this study, one of the crucial strategies used by businesses to increase the sale of their products is product advertising. Its significance in influencing consumers’ attitudes immediately as well as in building demand cannot be overstated.

Again, given this context, this study will have a huge impact on businesses, particularly breweries, advertising agencies, consumers, and academics.

The data in this study will reveal to businesses some inherent purposes of advertising. The unique characteristics of advertising, its forms, and its purposes for businesses will be further revealed. These crucial advertising-related difficulties can aid businesses in creating or articulating a product advertising strategy that may assist them reach their desired sales volume.

To companies with chequered advertising policy, the information contained in this study will help them restructure and reformulate it with a view  to achieve their objective of increasing demand for their products,  actualizing their sales volume target. Moreso, brewing companies will appreciate the information content of this study because it will help them to choose appropriate form of advertising and media to use in implementing their advertising policy.

Further, advertising agents will equally benefits from the information contained in this study. If not for any other thing, it will help them to fashion out more effective. Ways  or means of laising with  companies in order to  formulate and implement effective product advertising policy for them.

Also, since customers are the primary target of businesses’ advertising strategies, they will find the information in this study to be adequate for enabling them to develop understanding of the concept of product advertising. Additionally, they will understand the importance of always listening to and/or paying attention to media advertisements because they may remodel and redefine their purchasing attitude and decision.

Finally, the informational value of this work will benefit other academics and researchers in some way. This will assist them in conducting additional research on the topic of this study.

1.6   SCOPE OF THE STUDY

This focuses on how brewers’ sales volumes are affected by product advertising. The Nigerian Breweries Plc is used as the case brewing company in this operation. In other words, the study focuses on how the company’s advertising strategy affects the amount of sales. Other topics covered in the study include the forms of advertising and media used by Nigerian Breweries Plc to carry out its product advertising policy, the company’s level of commitment to marketing its goods, the effect of the advertising strategy on the company’s growth and profitability, and the challenges that the company faces in putting its advertising strategy into practice. The study will also make the researcher’s recommendations public.

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