THE EFFECTIVENESS OF PERSONAL SELLING IN THE MARKETING OF CAPITAL GOODS (A CASE STUDY OF ANAMBRA MOTOR MANUFACTURING COMPANY ANAMMCO)
ABSTRACT
This study focused on the effectiveness of personal selling in the marketing of capital goods. It goes on to explain some processes involved in personal selling and how it can be combined to achieve efficiency. Anambra Motor Manufacturing Company was the company used in this study; its staff were studied as well as their business consumer in other to determine the effectiveness of personal selling in the marketing of their products. The main purpose was to find out among their things the following. Effectiveness of personal selling in the creation of awareness. The impact of personal selling on repeat purchase. How ANAMMCO Product demonstration awakens the customers interest. To know if ANAMMCO’s customer’s patronage is high or low in relation to personal selling. To know if ANAMMCO’s ration of sales expenses to sales volume is high or low. To study the performance of ANAMMCO sales person and how their performance affects the company’s profit. The populations of the study were from the management/staff of ANAMMCO and their business consumer in Enugu metropolis. Topman’s formula was used to determine the sample size since it was not possible to study the entire population in Enugu metropolis. Questionnaire was used to collect data from respondents. These data were carefully analyzed and interpreted using tables which chi-square statistics were used to test the four hypotheses formulated. Based on the analysis, the following findings were made. That ANAMMCO sales persons are performing well in creating awareness for their products. That the sales person are also not lagging behind in getting the interest of the prospects. That the company is operating at a good profit margin but has not actually measured up to the expected level. That the customers patronage level needs to be improved. Inadequate motivation of sales force. Based these findings, the reasonable recommended ways with which to solve some of the problems encountered by the company. Such as mapping out the following strategies to improve customers’ patronage. Provide additional product information and suggestions for product care and maintenance though brochures or advertising. Ensure good services and immediate follow up on complaints to provide post-punch have support. Follow up after the purchase with direct contacts to make the customers understand how to use the products and to ensure satisfaction. Increase the level of customer involvement with their brand by increasing the importance of a product attribute. It is strongly believed that if the above measures are taken, the company will be placed on the track of efficiency.
CHAPTER ONE
INTRODUCTION
For over a decade and half now, Anambra Motor Company (ANAMMCO) which specializes in the products like: Cars, Trucks Buses and social Benz vehicles such as tippers, Lorries, Tankers, Jeeps and a lost of others has for a number of years been keeping the nation on a regular speed in the area of technological development. Utilizing considerable local components these vehicles are built as nothing but replica of excellence and durability.
At its inception, MB AMAMMCO was nothing but a mere Motor assembling plant which was initially planned to produce trucks for the Nigerian Market. But today, the prevailing situation with the company has changed drastically from a mere assembling plant to a manufacturing company. The plant has diversified its product range to include the full range of Mercedes – Benz commercial vehicles for the rapid industrialization of the country. It not only produces trucks such as L800, L1418 and ACTROS, but has gone a step further in design, fabrication manufacturing, production and sales of buses and other utility vehicles. Part of its product range include MBO 800, MBO 1418, MBO 1721, MBO 400 Marcopolo/Busscar, fire fighting vehicles, Ambulances, Mobile Clinics, Refuse collectors and other various specialized types of vehicles.
Unstressed by the evergreen availability of genuine spare parts and efficiency of their sales service which is a major trait of any personal selling effort, MB ANAMMCO has not only been keeping the nation in Motion but has also been a baron with regard to the incessant strife towards developing the path to establishing an indigenous auto industry. The company is a joint venture between the Federal Government of Nigeria and Daimler Chrysler AG. It is a franchising one which was commissioned on July 8, 1980 and started its officials production in January 1981 having been mandated by the original owner of the Mercedes Benz Trade Mark.
At its preamble, Mercedes Benz ANAMMCO was established with its cooperate headquarters at Emene industrial Layout headquarter at Emene Industrial Layout P.M.B 2523 in Enugu State. However, the aforementioned company having attained the peak in the field of manufacturing as well as the provision of after sales services in the motor industry, had decided to spread its sales offices over almost all states in Nigeria. Primarily as a result of increase in the demand for its products and this positive experience is due mainly to the dissemination of words of mouths to others who have not defected the wonders in the company’s products especially in the areas of efficiency, durability, prestige, comfort and a host of others.
This words of mouth confession being made by both current as well as previous patronizes of the firms product is a partial brain behind the company’s elevation in production capacity in previous years and this also created rooms for the absorption of more workers in the divergent department, thus helped to reduce the high rate of social menace that would have associated the situation of mass unemployment. Thus certain individuals particularly the enlightened have been thanking ANAMMCO for its laudable act in the continued improvement into our economy through its previous but high productive attainment in the previous. However, the senior assistant manager in charge of franchise and marketing development has not failed to give credence to the various promotional techniques in ensuring the previous attainment.
According to him, the use of promotional tools are indispensable in the marketing of capital (industrial) goods. This is apparent as users of such products are seeking both current information as well as the provision of after sales services and those terms related to the purchase and application of industrial (capital) goods. However, the aforementioned company which either had attained the peak in the motor manufacturing industry has stated experiencing a dwindling ground in its sales volume and market share. This current situation has thrown the management of the aforementioned company into chaos as a reliable percentage of their market share have been captured by other competitors in the same industry.
According to an insider, this nauseating experience is accounted for by a number of recent developments. Some of these developments are: The incessant increase in the number of companies currently involved in the manufacturing and sales of different cars, trucks etc. and besides the increase and efficient application of the divergent promotional tools. In accordance with his contention, previously, there were relatively few firms in the Motor industry and this tends to reduce the level of competition among the few producers; he further stipulated that under such situation, a particular firm will generate a reliable volume with a minimum promotional efforts and this was the position of ANAMMCO as at the said era.
He buttressed his points by revealing that increase in the number of companies constituting a particular industry is synomous to increase in technological developments and innovations as well as extreme competitions coupled with efficient utilization of the promotional strategies. Before this experience of relegated sales volume and profitability, the management of the company had been adopting both advertising, publicity, sales promotion and personal selling in relating as well as persuading both current and potential customers to indulge in the constant application of the company’s products. However, the management of ANAMMCO is not skeptical regarding the wonders of personal selling in the marketing of capital goods and that thus promo tool could only justify its wonders in capital goods marketing, only when it is effective. To this end, the management is interested in knowing if its sales force is effective or otherwise. This is the core of this study.
1.1 BACKGROUND TO THE STUDY
Selling has been a standard business activity for thousands of years. The earliest peddlers were traders who had some type of ownership interest in the goods they sold after manufacturing or importing them. In many cases, these people viewed selling as a secondary activity. Selling later became a separate business function. The peddlers of the 18th century sold to the farmers and settlers of the vast North American continent. In the 19th century, salespeople called drummers sold to both consumers and marketing intermediaries. These early sellers sometimes used questionable ales practices and techniques, and they caned undesirable reputations for themselves and their firms. But selling is far different from what it was in it’s early years. Far from the fast- talking, joke- telling, back- slapping caricatures in some novels and comic strips, today’s salesperson is usually a professional.
Professors Ingram and Lafoge (1995:108) defined sales professionalism as, “a customer –oriented approach that employs truthful, non manipulative tactics to satisfy the log- term needs of both the customer and the selling firm”. Professional sales people are problem solvers, focusing on satisfying the needs of customers before, during and after the sale. They are armed with knowledge about their firm’s goods or services, those of competitions and their customers businesses.
Personal selling today is a vital, vibrant, dynamic process. It is an interpersonal persuasion process designed to influence certain person’s decisions. It is an important ordering as well as getting ingredient available to the executive responsible for determizing the promotional mix. It involves face-to-face experience between the seller on his/her representative and the prospective customer as the case may be. The effectiveness of personal selling as a major promotional tool in the industrial (capital) goods industry cannot be over emphasized. Sales forces accomplish this objective in a number of ways.
According to Rogers (1992:401) sales Management, personal selling has become one of the vital promotional tools in marketing. He further buttressed the above proposition by stipulating that after all the theorists planners must have had their moment and the predicaments associated with production, finances and labour have been resolved, then someone has to go out and knock at someone’s door and sell.
This revelation is apparently acceptable because a product cannot be produced at Enugu and is not available in a place like Lagos where such product is highly needed. This is the significance behind the notion of sales contention that, the sales people must not relent in their effort for prospecting, they should investigate into the needs of consumers as well as filling them with satisfaction and optimize profit objective.
A critical analysis of the aforementioned statement highlights the importance of the effectiveness of personal selling on the marketing of capital goods. A product may be of extremely high grade but has no utility until it gets to the hands of prospective buyers; and the most appropriate route for passing products from manufacturing arena to the hands of potential buyers happens to be through personal selling. It is pertinent to recognize at this moment that personal selling is nothing but a Herculean task. This is so as the salesperson has little or no time for rest primarily because he/she indulges at home works and at certain time involves himself in some sales calls that may never result into sales.
A sales philosopher called “stake holders alignment” says that people attempts to become partners with their customers. He continued by saying that mentality and contemplates more on the customer profit needs. How someone sell is an off-spring of what is being sold. To this regards, good sales person should be able to identify correctly the persuasive message that is precise in a given sales situation.
