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Every business organization when established is saddled with laid down objectives, which serves as the driving force towards which the managers and directors of such organization, strive to actualize. In an attempt to actualize the set objectives, several factors are considered, which will serve as ingredients that will aid the quick actualization of the set objectives, with every department working together towards the attainment of the set objectives; the departments include production department, accounts department, marketing department, etc. The production department sees to the manufacturing of the products or rendering of services, the marketing or sales department as the case may be sees to the dissemination of the manufactured products to the customers at a considerable price, while the accounts department with the assistance of the sales and marketing department records the sales turnover in a quantitative manner. For the marketing department to carry out its activities effectively, various functions are carried out, amongst which is the fixture of price, interaction with customers and potential customers, organization of promotional activities to boost sales and the use of various advertising strategies towards the attainment of the departmental objectives.
The essential nature of Advertising cannot be over emphasized as it is seen or known to be the main promotional tool applied to promote goods and services of small businesses and multinationals alike, which is as a result of its effectiveness in attracting and maintaining consumers' loyalty (ISBA, 2004). Research has since shown that advertising marketing is a key driver in product branding and awareness (see Clark et al., 2009). Advertising is an important component of marketing strategy, with the aim of promoting a business and communicating product information to intended audience, usually with the aim of increasing sales or making the audience aware of the products or services.
Advertising is relevant in organizations (small and multinational) because it generates sales through increased awareness, presentation of persuasive arguments for product purchase and in brand differentiation (encyclopedia.jrank.org, 2010). Advertising has been identified as an important factor in marketing goods and services and increasing sales through awareness by motivating the demand for particular products (Small Business Bible, 2008).
The essence of strategy is to match strength and unique competence with terrain in such a way that the business enjoys a competitive advantage over rivals competing on the same terrain; strategy refers to the ideas, plans, and actions used to help firms and people compete successfully in their activities (Pitts and Lei, 1996), resulting in the attainment of the organizational objectives. Thus strategy should be employed by organizations in the management/marketing process in order for them to succeed in their activities. A process of strategic management will refer to the combination of three major interrelated activities: strategic analysis, strategy formulation, and strategy implementation (Dess and Miller, 1993).
Management/Marketing strategy is a critical factor to the attainment of long-term goals and objectives of an organization. To deal effectively with everything that affects the growth and profitability of a firm, executives seek to employ strategic management processes that they feel will position it optimally in its competitive environment by maximizing the anticipation of environmental changes and of unexpected internal and competitive demands such as change in price of raw materials, change in customers' preference for some products as well as change in the weather condition, for seasonal products (Stroh and Leonard 1999; Pearce and Robinson, 1997). According to Pitt and Lei, (1996), a management process designed to satisfy strategic imperatives that push forward the firm's vision and mission is called a strategic management process and it consists of four major steps: analysis, formulation, implementation, and adjustment or evaluation.
This study however is focused on a marketing strategy, at the disposal of all marketing managers, which is advertising, with a close look at the various advantages of advertising on business success and product penetration. There has been criticism on advertising; some critics say it is a waste of money (Shotwell, 2009), and some say it manipulates consumers physiologically (see Wolff and Biernatzki, 1994). The researcher also sees it important to investigate the effect of advertising marketing on market penetration. This research focuses on an analysis of the promotional tools used by small businesses in Nigeria, the research will be carried out in a state in Nigeria (Lagos). There are various definitions to the word small business, but for the sake of this study, the definition of the Central Bank of Nigeria (CBN), which defines small scale enterprise as an enterprise whose total cost, excluding cost of land but including working capital, is above N1.0 million but does not exceed N10.0 million (Aregbeyen 1999:7; CBN:1996:7) is adopted.
This research therefore considers the dimensions that advertising marketing takes in the small business organizations in Nigeria.
Small scale businesses have played a major role in economic growth and development due to their collective, larger output and employment effects (Sanusi 2000; Sanusi 2003). Wilson (2006) stressed that small scale businesses have been of economic and social significance internationally that its development can no longer be left unnoticed. Small scale business in Nigeria constitute over 80 percent of all registered companies, occupying positions in agro based and allied industries, rubber based, leather shoes industries, chemical, electronics, general merchandising, restaurants, dress making, hair making, cane-chairs production, leather products, pomade and toiletries, animal feeds and husbandry, printing, etc. They have accounted for a large percentage of all businesses and a favorable percentage of the nations' gross national product (Ayozie 2008:10-15).
Despite the integral role played by small businesses in Nigeria, in ensuring that it delivers its contribution to the economic development of the country, perceptions of inefficiency of small scale industries in the creation of awareness, (marketing) attraction and maintenance of consumers is a major problem. According to Kola and Akinyele (2010) Nigeria still has a very poor understanding of the role of effective marketing communication with customers in attracting and maintaining prospective and present customers. Advertising is one of the most effective tools in attracting and persuading consumers. Jobber (2010) states a strong theory of advertising which shows that a person passes through the stages of awareness, interest, desire, and action (AIDA, 1920' Model). According to this theory, advertising is strong enough to increase people's knowledge and change people's attitudes, and as a consequence is capable of persuading people who have previously bought the brand to buy it. Capon (2008) futher states that Hierachy of effects model are central to how advertising works, and two models are shown below:
HIGH INVOLVEMENT LOW INVOLVEMENT
Trial Repeat purchase
High involvement: the customer believes that the purchase, like an automobile, involves financial and/or psychosocial risks to make a decision the consumer engages in a stage learning process. (Capon 2008)
Awareness: learning that the product is available for purchase.
Knowledge : understanding the product's features, benefits and values.
Linking or Preference : developing favourable or positive feeling about the product.
Trial : testing the product befor purchase and use.
Repeat Purchase : purchasing the product again. Advertising can reinforce positive feelings that lead to repeat purchase.
Low involvement: consumers see little risk and require little pre-purchase knowledge, like FMCG categories such as soda or cereal. Because risk is low, the hierarchical process is quiet different. Advertisings role is to create high awareness and motivate customers to trial. If the customer likes the product, she repurchases. Capone (2008).
Research has shown that lack of effective and strategic marketing (advertising) in Nigeria is responsible for the inability to create awareness and attract consumers by small businesses. A research carried out by Okpara et al. (2007) with structured interview and survey gathered data from over 400 small businesses in Nigeria to find the principal constrain to success of small businesses, it included poor management, weak infrastructure and so on. Sanni (2009) also noted that the Nigerian small scale enterprise seems too stagnant (problems with imminent collapse and failure), less adventurous than developed countries (Eneh, 2010).
According to Stokes and Wilson, (2006) and Thompson, (1997) the expected goal and ultimate destiny of an organization can be shaped by developing a proper strategy. It is therefore important for small businesses to develop advertising strategies in other to create awareness, attract and maintain consumers. Kolter and Armstrong (2005) stated that advertising consist of two major elements: creating advertising messages and selecting advertising media. Erhum and Erhum (2003) cited Nelson, (1974) saying a company's wish is for its brand to be the first to be demanded when the need arises.
Advertising finds its place in the marketing mix family, as a promotional tool which includes personal selling (attending exhibitions), sales promotion (e.g. special offers), and atmospherics (creating the right impression through the working environment), public relations (Webber, 2005) which is used in communicating and creating awareness for the company's products, or aimed at stimulating the consumers in to purchasing the company's product.
From the data recently published by the National Bureau of Statistics (NBS), unemployment rose to 19.7% with about 10 million Nigerians unemployed as of march 2009, from 14.9% in 2008 and 13.1% in 2000. Although it may not be in an overwhelming majority, small scale industry still represents a significant proportion of Nigerian workforce. It is important to further evident the nature of the advertising marketing strategy used to create awareness, attract, persuade and maintain consumers to increase sales. It is also important to make the industry attractive for young entrepreneurs who intend to go into small scale businesses, and help improve the industry to assist in employment due to the rate of unemployment and its continuous rise.
Furthermore, there has been criticism on the importance of advertising in selling a company's product and the way it influences the society. According to Smith, (1995) consumer behavior is moderated by a complex web of mostly internal variables such as motivation, perception, attitudes, learning, memory, lifestyle, personality and groups)''. Smith, (1995) also logically states that ''if one brand can get in the front of an individual's mindâ€¦, then it will stand a better chance of being chosen in a simple buying situation'. This relatively underpins the saying that consumers are passive victims of advertisement. The origin of social comparison theory which resides with Festinger (1954), who argues that consumers constitute themselves and negotiate their own identity in comparison to other people. Richens (1991) quotes Schudson (1984, p.215) note advertising 'does not claim to picture reality as it is but reality as it should be-life and lives worth emulating. Richens (1991) portrays the consumer as a passive victim subjected to an assessment standard dictated by advertising images that arouse purchasing behavior by intimidating the consumer's self concept satisfaction.
The small scale businesses are of particular interest because of the essential role they play in the economic, development and employment of a nation. Craig and Kohlhase (2006) stated the importance of small firms and the vital role they play in maintaining economic growth in urban areas and that they compete with large firms for land near employment centers, Obokoh (2008) sites Wattanapruttipaisan (2003) stating that small and medium sized enterprises (SMEs) are the backbone of virtually all economies of the world because of their role in employment creation and provision of personalized services. According to Ariyo (2008) The SME sector provides, on average, 50% of Nigeria's employment, and 50% of its industrial output. Effectiveness and efficiency of marketing strategies in small scale businesses is therefore instrumental in providing good quality services in creating awareness of products and services. Therefore increasing sales through advertising, will help small businesses grow in to multinationals and create more job opportunities in the nation (Nigeria).
Although critics say advertising is a source of cash drain and waste of funds, which has a negative impact on a company (Shotwell 2009), this study intends to investigate the impact of advertising on the growth of small business and the effects on consumer behavior. It is noteworthy that this research does not intend to generalize based on its findings but to gain an insight into what advertising strategies are available to small businesses in Nigeria with reference to a state in Nigeria (Lagos). Nevertheless, it is understood that some elements of findings of this research may be applicable to other small business sectors within Nigeria.
The study aims to investigate the role of advertising marketing strategies available to small businesses in Nigeria on the market penetration of their products. The research will be done in a state in Nigeria (Lagos).
In achieving the aim stated above, the following objectives have been set:
Investigate the impact of advertising on the growth of small business organizations
Analyse the impact of advertising on consumer behavior
Critical analysis of advertising strategies available to small business organizations in Nigeria.
Analyse and evaluate the extent to which small firms adopt advertising strategies in their business practices.
A critical analysis of the problems hindering the adoption and execution of advertising strategies by small business organizations in Nigeria.
Questions: In a bid to achieve the objectives stated above, the following research questions will be proffered answers to:
Does advertising have a significant impact on the growth of small business organisations?
Does advertising have a significant impact on the consumer behaviour and What are the advertising strategies available to small business organisations in Nigeria?
To what extent do small firms adopt advertising strategies in their business practices?
What are the problems hindering the adoption and execution of advertising strategies by small business organisations in Nigeria?
What is the role of advertising marketing on the market penetration of small business organisations in Nigeria?
Hypotheses: To find an answer to the above stated research questions, the following hypotheses will be tested in the course of the research:
H0: Small business organizations in Nigeria do not adopt advertising strategies in their business practices
H1: Small business organizations in Nigeria adopt advertising strategies in their business practices
H0: There is no significant relationship between advertising marketing and growth of small business organizations in Nigeria
H2: There is a significant relationship between advertising marketing and growth of small business organizations in Nigeria
Scope and Limitation: This work will be carried out in Lagos State Nigeria. This location is chosen because of the number of small business organizations in the state, however it gives a
This work however considers advertising marketing and its role on the growth of small business organizations.
1.5 STRUCTURE OF THE STUDY
This study seeks to explore the marketing strategies adopted by small business organizations in Nigeria. The following gives a brief synopsis of the chapters of this dissertation.
Chapter one focuses on the introduction, rationale, research topic, aims and objectives of the study.
The second chapter entails the review of relevant literature on Advertising, effective advertising and the effects of advertising and an in-depth view of Nigerian small business organizations and marketing limitations.
The third chapter involves assessing various forms of methodology and details of semi structured interviews, questionnaires, and data acquisition techniques used in research process, and it also entails the methodology used in carrying out this research.
Chapter four extensively focuses on the presentation and analysis of the data collected through primary research such as face-to-face interviews and telephone interviews.
Chapter five dwells on the discussion of key findings drawn from the interviews in line with the research aim and objectives relative to literature reviews. Here, the review will extensively ascertain whether the research objectives have been adequately addressed by the interviews and the concluding part of the dissertation. This involves a summary of the conclusions drawn through research based and logical arguments developed in the course of carrying out the research.
This chapter is aimed at exploring the methodology adopted in the course of this research work. It gives a brief summary of the research design, research instruments adopted, the population of study, the size of the sample used, the sampling techniques, how data was gathered, the sources of data used, the instruments used for data collection, a brief description of the questionnaire, the validity and reliability of the instruments used, how the instruments were administered, the location of study, the method adopted in the analysis of data, as well as the instruments used for data analysis.
3.1 Research Design
Research designs are the plans and procedures of inquiry (strategies) and specific methods of data collection, data analysis and interpretation. However, the selection of a suitable research design should be based on criteria such as the nature of the research problem, the audience for the study and the researchers personal life experiences (Creswell, 2009).
According to Gilbert (2008) the research design should involve the entire research process been considered and planned, including the background to the problem and the review of previous research, through to the research approach and the methods of data collection and analysis. It is important that strategies adopted at each stage of the research design should reflect on the research question and involve the use of the research design and question to interrogate each other. The researcher strongly agrees with Uma(2003),Saunders et al(2003) and Pervez and Kjell, (2002) as the researcher intends to find answers to specific problems systematically through critical and scientific enquires making use of both primary and secondary data sources on the role of advertising promotional tools on small business organizations in Nigeria. The study adopts a survey research design, which is limited by the hypothesis, research questions and the research objectives stated in the first chapter. The study uses primary data gathered through the administration of questionnaires and conduct of interviews. The interview was done to solicit information from some of the sample respondents. The respondents include managers, accountants, entrepreneurs and marketing managers of small business organizations in Nigeria, and consumers of their products, with a sample size of fifty business executives and fifty consumers, to give a total of 100 respondents chosen randomly from the entire population size. Secondary data will be gathered from journals, newspapers, internet sites and text books.
Creswell (2003) defines survey design as one which gives a quantitative or numeric description of trends, attitudes, or options of a population by studying a sample of that population at a time. Survey design is used to make inferences about certain characteristics, and to make claims about the study population. Surveys are commonly used in research because of the ease of use, structured format, easily coded and quantifiable data and the ability to statistically compare cases. However, disadvantages of the method include its assumptions that all respondents understand the question in the same way and that they all define terms similarly and the imposition of ideas or way of thinking about the issue on the respondents (Yates, 2004).
3.2 Population of Study
According to Idisi & Oshionebe (1998: 61) citing Akuezuilo (1993), it was noted that population is a relative term which symbolizes not just people alone but also events, animals and objects who or which are members of the target of the study as defined by the aims and objectives of the researcher. The population of this study consists of the entire small business organizations in Nigeria and the entire population of consumers in Nigeria.
3.3 Sample Size & Sampling Technique
Jankowicz (2005) describes a sample as a number of people set apart from which the data to be used for the study is collected. Uma (2003) noted that a sample is a subgroup or a subset of the population from which data is collected. Hence, sampling can be defined as the process of selecting a sufficient number of elements from the population, so that a study of the sample and an understanding of its properties or characteristics would make it possible for the generalization to the population elements (Uma, 2003).
The reason for the researcher using a sample is due to the fact that there are thousands of respondents that fall into the category of people that can be interviewed; the Nigerian population is over 140 million people and it will be practically impossible to collect data from, or test, or examine every element (Uma, 2003).
There are two forms of sampling designs; probability and non probability sampling (Creswell, 2009). In probability sampling, the elements in the population have some known chance of being selected as sample subjects, while in non probability sampling, the elements do not have a known chance of being selected as subjects (Jankowicz, 2005). Though the two major forms of sampling have different strategies, probability sampling designs are used when the representativeness of the sample is of importance in the interests of wider generalization (Uma, 2003). Hence, the researcher intends to have a non probability sample design made up of different stakeholders of small organization in Nigeria (Lagos). In a bid to save valuable time and money, reduce fatigue and error rate, and probably produce more reliable results, the researcher intends to use a non probability sample in conducting the research (Pervez and Kjell,2002).
Though the researcher intends to have a small sample size of 50 small business organizations and 50 consumers for convenience and savings in cost and time, the ultimate decision of the sample size which will be affected by the extent of precision desired, the acceptance risk on predicting that level of precision, the amount of variability in the population itself and the size of the population itself (Uma, 2003). Hence, the researcher intends to use a small sample size due to its intensive nature of administering questionnaires to the executives of small business organizations as well as the consumers. For the purpose of the research, considering the time scale and cost implication, 50 respondents cutting across all sectors of the nation will be interviewed to collect comprehensive data needed for the research. It is also important to note that the period of study is a critical and tense period of election in the country, which will also affect the number of questionnaires to be administered.
According to Idisi & Oshionebe (1998) sampling techniques, tells the reader which of the techniques applied and how it is used. For this study, from the total population of small business organizations in Nigeria, fifty small business organizations were selected randomly from the various sectors of the nation, as well as the consumers. The sample was selected by the researcher because of time constraint and for convenience in the gathering of data and its analysis. The purpose of selecting top management of small business organizations from different sectors is to collect data that completely covers the research aim and objectives.
3.4 Data Gathering Method
Data was gathered through the use of some research instruments, which are useful for the study. Data was gathered through the use of questionnaires and the collection of some necessary materials relevant to the study at hand. Ojo (2003) defined a questionnaire as an instrument containing some questions and/or statements for which the respondent will be expected to provide answers to or confirm the statements. The major method adopted is the administration of questionnaires, which was filled by the respondents and however analysed by the researcher, and where need be, personal interviews were conducted, which is to ensure that some of the information in the questionnaires were not misinterpreted and also to have a good understanding of the responses of the respondents.
3.4.1 Sources of Data
Primary data was gathered through the use of questionnaires and interviews. The questionnaires were administered by the researcher through the help of a research assistant. Interviews were conducted, the result of which was written as notes. Secondary data was gathered from journals, magazines, newspapers, internet database and university library.
3.4.2 Instruments for Data Collection
The research instruments used for this study are mainly questionnaires and personal interview. The information retrieved from personal interviews was recorded with a notepad, which was later used as a source of information both in the body of the work and the recommendation section.
3.4.3 Description of Questionnaires
The researcher constructed two types of questionnaire, with the first type soliciting information from the executivesof small business organizations and the second type soliciting information from the consumers. The questionnaires were designed in a way that it covers every aspect of the research objective and the research hypothesis, without leaving any aspect untouched. The type A questionnaire was designed to contain structured and open-ended questions (hybrid). The section A of the questionnaire looks at some personal information about the respondent. This was used to determine the caliber of respondents interviewed, and also determine how reliable and important the information given is to the research work. The section B of the questionnaire type A looks at the various hypotheses to be tested, thus having a group of questions testing each hypothesis. While the type B questionnaire was designed to contain structured questions, with section A of the questionnaire soliciting personal information about the respondent, which was used to determine the caliber of respondents interviewed, and also measure how reliable and important the information given is to the research work. The section B of the questionnaire type B looks at the various hypotheses to be tested, with a group of statements testing each hypothesis, and measuring the respondents' view about the statements in this section.
3.4.4 Validity & Reliability of instruments
Validity is the degree to which a measuring instrument measures what it is designed to measure, while reliability is the consistency between independent measurements of the same phenomenon. It is the accuracy, stability, dependability and predictability of a measuring instrument. Content validity was used in the study, as experts verified the questions contained in the questionnaire, to ensure its conformity with the topic at hand and the various objectives as well as its relevance to the hypothesis to be tested. The contents of the instruments are however relevant to the study at hand as well as the hypothesis it tests. The test-re-test reliability was also used to test the reliability of the instruments. In test-re-test reliability, the same measuring instrument is used to take two separate measurements on the same population at different times. The higher the correlation between the two measurements the higher the reliability of the measuring instrument. The test-re-test reliability was used and the level of correlation was high.
3.4.5 Administration of instruments
The instruments were administered to managers, accountants, marketers, entrepreneurs and the respondents who are expected to give relevant information about the subject matter. The instruments were administered by self and through the help of research assistants, who help in the administration and collection of the instruments.
3.5 Actual field work/ location of study
The instruments were administered to respondents in Lagos state small business organizations in Nigeria, as well as consumers in Lagos state, as this forms the location of study. The researcher selected executives of some small business organizations across all sectors within the state randomly, as the entire population in the state cannot be visited. One hundred respondents were selected distributed into 50 executives of small business organizations and 50 consumers in Nigeria. These were selected because of the cluster of small and medium enterprises in this place.
3.6 Data analysis method
3.6.1 Method of data analysis
Data analysis is the process of bringing order, structure and meaning to the mass of collected data (Uma, 2003). In data analysis, the researcher has two objectives to meet; getting a feel for the data and testing the goodness of the data (Uma, 2003). There are different stages or steps in analyzing data.
The researcher intends to follow these steps outlined below:
This involves organizing and preparing the data for analysis. After collecting data from respondents through interview, the data will be edited to check for incompleteness and inconsistencies if any, for onward rectification.
This involves data reduction; the process of selecting, focusing, simplifying, abstracting and transforming the data that appear in writing up field notes or transcriptions in order to have repeated and more thorough examinations of the interviewees' answers (Bryman, 2004). This is done to create meaning from the mass of words (Pervez and Kjell, 2002). Here, the interpretation of data will be important in arriving at understanding.
Here, detailed analysis of data with a coding process begins. This will involve taking text data, segmenting sentences or images into categories with a term based on the actual language of the respondents (Creswell, 2009). The coding process will be used to generate descriptions and small number of themes which appear as major findings in the research. The data collected will be displayed in the form of an organized and compressed assembling of information that permits drawing conclusion and taking action. Creswell, (2009)
This is the final step in the data analysis and it involves making an interpretation or meaning of the data, which could be the researcher's personal interpretation or meaning derived from findings with information gleaned from the literature or theories (Creswell, 2009). Hence, this will lead to the drawing up of valid conclusions from understanding of the actual phenomenon and making of relevant recommendations. Uma, (2003)
The researcher intends to follow the above listed steps in analyzing the data that will be collected from respondents. Hence, it is the intention of the researcher to ensure maximum consideration of ethics as stated earlier, in the collection and analysis of data from respondents, while focusing on achieving the aim and objectives of the research.
The data collected from the respondents were analysed in simple percentage proportion depicted in tabular form showing the number/figure and proportion of the respondents' opinions to the hypothesis. The Pearson Product Moment Correlation method of analysis was used in analyzing the data collected from the small and medium enterprises, from which the hypothesis is either accepted or rejected based on the answers from the calculation. This test is conducted to ascertain the type of relationship that exists between the variables (advertising and consumer behaviour). The Pearson Product Moment Correlation formula is given by
r = nâˆ‘XY - âˆ‘Xâˆ‘Y
(nâˆ‘X2 - (âˆ‘X)2)(nâˆ‘Y2 - (âˆ‘Y)2)
Where r = Pearson Correlation Coefficients
n = Number of period/event
X = Independent Variable (Advertising)
Y = Dependent Variable (Consumer Behaviour)
To further test the significance of the correlation that exists between the variables, the student t-test method will be used to measure the level of significance that exist.
3.6.2 Instruments for data analysis
Data was analysed manually and also through the use of a statistical package, called SPSS. The data collected were presented in a tabular form, to aid easy understanding by all readers and to avoid ambiguity of information. Percentages as well as the Pearson Product Moment Correlation Method of analysis were used, to test the various hypotheses of the research work. This is used, because it will help the researcher know the extent to which each of the intervening variables affects the dependent variable.