IMPACT OF SALES PROMOTION ON CONSUMER PURCHASE BEHAVIOUR IN TELECOMMUNICATION INDUSTRY
ABSTRACT
The growing managerial importance of sales promotion has generated a great deal of research on how sales promotion affects consumer purchase behaviour. This study generally sought to examine the impact of sales promotion on the consumer purchase behaviour of telecommunication service providers. The specific objectives include to; examine the relationship between consumer attitude to sales promotion and preference for telecommunication service provider, examine the relationship between consumer attitude to sales promotion and satisfaction with telecommunication service provider, examine the relationship between faithfulness to sales promotion promises and preference for telecommunication service providers. The study adopted a descriptive and correlation research designs. The population of this study is comprised of users who consume the various products of telecommunication service provider in Benin City, out of which a sample of 350 was used. The main source of data was primary in which questionnaires were used to collect primary data. The statistical tools includes descriptive statistics, independent T-test, one way ANOVA, spearman and Pearson correlation were used for the analyses. Findings from the study show that there is no significant relationship between consumer attitude towards sales promotion and preference for telecommunication service provider. It was also observed that there is a significant and weak relationship between attitude towards sales promotion and satisfaction with telecommunication service providers. It was also observed that there is a significant and moderate relationship between faithfulness to sales promotion promises and preference for telecommunication service providers.Finally, the study recommends that management of telecommunications should be faithful at all times to the sales promotion promises they make as this has a significant and moderate relationship between faithfulness to sales promotion promises and preference for telecommunication service providers.
Table of content
CHAPTER ONE: INTRODUCTION
1.1    Background of the study    -    -    -
1.2    Problem statement    -    -    
1.3    Objectives of the study    -    -    
1.4    Research questions    -    -    
1.5    Research hypothesis    -
1.6    Significance of the study    -    -    -    
CHAPTER TWO: LITERATURE REVIEW
2.1Introduction    -    
2.2 Sales promotion concept    -    -    -
2.2.1Types of sales promotion    -
2.2.1.1 Coupon    -    -
2.2.1.2 Point of purchase displays    -    -
2.2.1.3 Premium    -    -    
2.2.1.4 Trade shows and sponsorship    -    
2.3 Factors affecting the promotional mix    -
2.3.1 Nature of the product    -    -
2.3.2 Stages of the product life cycle    -
2.3.3 The pull and push strategy    -    -
2.4 Congruency theory and sales promotion    -
2.5 Consumer purchasing behavior    
2.6 Empirical review on sales promotion
2.7 Effects of sales promotion on organizational performance    
CHAPTER THREE: RESEARCH METHODOLOGY
3.1Introduction    -    -    -    
3.2 Research design    -    -    -
3.3 Population    -    -    -
3.4 Sample size    -    -    -    -
3.5 Sources of data    -    -    -
3.6 Data collection instrument    -    
3.7 Data analysis methods    -    
3.8 Reliability Test    -    
CHAPTER FOUR: DATA PRESENTATION, ANALYSES AND INTERPRETATION
4.1 Introduction    -    -    -    -    
4.2 Data presentation and analysis for demographic variables    -
4.3 Data analysis demographic variable    -    -    
4.3.1 Test of research hypothesis in relation to demographics variables
4.3.2 Test of research hypothesis    -    
4.4 Discussion of findings    -
CHAPTER    FIVE: SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Introduction    -    -    -    
5.2 Summary of finding    -    -    -
5.3 Conclusion    -    -    -    -    -
5.4 Recommendation    -    -    -
Reference    -    -    -    -    -    
Appendix    -    -    -    -    
Appendix ii    -    -    -    
CHAPTER ONE
INTRODUCTION
1.1Background of the study
The growing managerial importance of sales promotion has generated a great deal of research on how sales promotion affects profitability (Loudon &Bitta, 2002; Perreault& McCarty, 2002; Schiffman&Kanuk, 2004). There is no doubt that sales promotion have become a vital tool for marketers and its importance have increased significantly over the past 2 decades. In Nigeria, sales promotion expenditures by various companies is estimated to be in thousands of naira and the emphasis on sales promotion activities by the various industry players continue to increase year on year (Hanssens,2005). Sales promotion is an initiative undertaken by Organizations to promote sales, usage or trial of a product or service (i.e. initiations that are not covered by other elements of the marketing communication/promotional mix). It is an important component of an organization’s overall marketing strategy along with advertising, public relations, and personal selling (Schiffman&Kanuk, 2004). Sale promotion acts as a competitive weapon by providing an extra incentive for the target audience to purchase or support one brand over another. It is particularly effective in spurring product trial and unplanned purchases (Aderemi, 2003).
As presented by Achumba (2002), sales promotion refers to marketing activities, other than personal selling, advertising and publicity that stimulate consumer purchasing and dealer effectiveness, such as displays, shows and expositions, demonstration etc. Sales promotion has been defined as a direct inducement that offers an extra value or incentive for the product to the sales force, distributors or the ultimate consumer with the primary objective of creating an immediate sale (George, 1998). Elsewhere, Strang (2006) reviewed major trends in the   management of sales promotion in a sample of U.S. package goods companies. He documented the shift of funds from advertising to sales promotion budgets. However, the author did not explore specific promotions nor specific success factors associated with promotions. Analyzing Nielsen data, Peckham (1998) observed thousands of individual promotions. He concluded that sales promotions are most effective in stimulating sales during the introductory and growth phases of the brand's life cycle. Peckham further asserted that sales promotions frequently mortgaged the brand's future sales and he doubted the profitability of many sales promotions. Similarly, Lembeck (1999) found that only 40% of sales promotions are effective but there was no definition of success or effectiveness. Other studies suggest that sales promotions do not have a constant or continued effect on volume of sales of a firm which tend to diminish and come at the initial level at which it was before the sales promotion is being offered (Dekimpe& Dominique 1999; Pauwels,Dominique&Siddath, 2002; Srinivasan2000). Still some researchers argue about the usefulness of sales promotion, that whether it promotes the long term growth and profitability among brands for which it is projected is not compulsory (Kopalle, Mela& Marsh, 1999). In contrast, a study conducted by Ailawadi and Neslin (1998) revealed that sales promotions motivate the consumers to make immediate purchases and also positively impacts the consumption volume. In the midst of the above controversies, this research sought to examine the effect of sales promotion on organizational profitability using telecommunication as case study.      
1.2 Problem statement  
Although several sales promotions are conducted each year by telecommunication companies, promotion managers are frequently confronted with the challenges of defending the question of the impact of sales promotions activities on the profitability of the firm. A review of literature also shows that much of the previous research in sales promotion has focused on the consumer or retail trade response to promotions but has not incorporated the effect of sales promotion on profitability (Kopalle, Mela& Marsh, 1999; Ailawadi&Neslin, 1998; Dekimpe et al. 1999; Pauwels et al. 2002). For instance, Lembeck (1999) suggested that only 40% of trade promotions are effective but there was no definition of success or effectiveness.
The fundamental goal of promotion is to cause a bodily shift of the demand curve to the right, thus allowing more units to be sold at a practical price or the same units to be sold at a higher price. The presence of Economic turn down has increase the relevance of promotion. Expenditure on promotion by organization in the service or product sector is therefore soaring to an all time high. Promotional activities are assuming more sophistication and innovation (Kotler 1984). The ultimate question is how have these expenditures influenced the company’s profits? According to Hanssens, Donald & Richard (2001), sales promotions are relatively easy to implement and tend to have immediate and substantial effects on sales volumes. Consequently, the relative share of promotions in firms’ marketing budgets continues to increase (Currim& Schneider, 2009). However, sales promotion rarely has persistent effects on sales, which tend to return to pre-promotion levels after few weeks or months (Dekimpe et al. 2009;Nijs, Marnik,Jan-Benedict & Dominique.2001; Pauwels. 2002). Consequently, promotion’s effectiveness in stimulating long-term growth and profitability for the promoted brand is in doubt (Kopalleet al.1999). In line with the above, this study sought to examine the effect of sales promotion on the profitability of telecommunication companies.   
1.3 Objectives of the study  
This study generally sought to examine the effect of sales promotion on consumer purchasing behaviour.
1.    To examine the relationship between consumer demographics and preference to telecommunication sales promotion.
2.    To examine the relationship between consumer demographics and satisfaction to telecommunication sales promotion.
3.    To examine the relationship between consumer demographics and attitude towards telecommunication sales promotion.
4.    To examine the relationship between consumers attitude to sales promotion and preference for telecommunication service provider.
5.    To examine the relationship between consumer attitude and satisfaction with telecommunication sales promotion.
6. To examine the relationship between faithfulness to sales promotion promises and preference for telecommunication service provider.
1.4 Research Questions    
The following research questions were answered:
1.    What is consumer attitude towards sales promotion?
2.    What is consumer mean satisfaction with sales promotion in the telecommunication industry in Benin-city?
3.    What is the relationship between consumer attitude towards sales promotion and preference for telecommunication service provider?
4.    What is the relationship between consumer attitude and satisfaction with telecommunication sales promotion?
5.    What is the relationship between faithfulness to sales promotion promises and preference for telecommunication service provider?
6.    What is the relationship between demographics and consumer preference, attitude and satisfaction with telecommunication sales promotion?
1.5 Research Hypotheses
The following hypotheses were tested in this study:
1.    Ho: there is no significant relationship between consumer demographics and preference to telecommunication sales promotion.
2.    Ho: there is no significant relationship between consumer demographics and satisfaction to telecommunication sales promotion.
3.    Ho: there is no significant relationship between consumer demographics and attitude towards telecommunication sales promotion.
4.    Ho: there is no significant relationship between consumer’s attitude to sales promotion and preference for telecommunication service provider.
5.    Ho: there is no significant relationship between consumer attitude and satisfaction with telecommunication sales promotion.
6.    Ho: there is no significant relationship between faithfulness to sales promotion promises and preference for telecommunication service provider.
1.6 Significance of the study
This study is significant in three respects. First is its contribution to the telecommunication industry; as presented in the background statement, many managers particularly those with less appreciation for marketing continue to challenge the excessive budget expenditures in the area of sales promotion. This study is expected to engender further discussion and probably provide some answers regarding the effect of sales promotion on firm profitability. The findings will provide a solid reference point for many marketing managers to defend allocations made to sales promotion activities. The contribution of this study to the economy though arguable can be seen in the adoption of promotional tools that create value for customers. Since the primary objective of every sales promotion to influence sales and trial of new products, it is expected that increased sales will trickle down into profits “ceteris paribus”. By extension, government generates revenues from taxation.  The contribution of this study to academia is also not in doubt as it provides a good premise for future research. It also adds to existing literature on sales promotion and its effects on firm profitability.