CHAPTER ONE
INTRODUCTION
BACKGROUND OF THE STUDY
Advertising is one of the four promotional tools companies use to direct persuasive communications to consumers or buyers and the general public. Advertising policy constitutes such an important strategy in the marketing programme of companies that its negligence could spell down for companies. Generally speaking, companies exist to produce and market products. This objectives cannot be actualized if the manufactured products are not brought to the knowledge of the consuming public. If the consumers and the general public are not informed and educated on the needs and wants, some products could satisfy; they will definitely stay clear of the products.
Against this background, product advertising focuses on projecting the image and marketability of products in such manner that will make them acceptable to the customers and buyers. Odunsi (1998:19) noted the important of product advertising when he stressed that growth being recorded in the advertising field is connected with its potentiality to enhance the acceptability and marketability of companies’ products. Product advertising has helped so many companies to revive and reposition some of their products which have almost reached the decline stage in their life cycle.
Furthermore, the continuous existence, survival and growth of companies to some extent depend on the performance of their products and the level of their sales volume. The fact still remains that for a company to declare profit and possibly grow, its sales volume must be high. For its sales volume to be high, its product must be acceptable to the consumers hence giving rise to their high demand.These can only be achieved when these products are made known to the buyers through advertising. Product advertising as stressed by Udeagha (1995:219) is an effective promotional tools that will not only inform and educate buyer or consumers about a company’s products, but highly significant in achieving the targeted sales volume of the company.
The Nigerian Breweries Plc. Is one of the leading breweries for over 50 years of existence, operating in Nigeria today. The company has a wide range of products that include alcohol, malt and soft drinks. The notable products in the companies product mix include, Gulder, Star, Amstel malt, Maltina and Schweppes. The company has a large factory at Agbana, Lagos and a brewering plant at 9th Mile Corner, Ngwo in Enugu.The company has already started constructing what seems to be the largest factory and brewery in Africa between Eke and Ngwo in Enugu State.The Nigeria Breweries Plc. Has depot inmost state capital of the federation to facilitate the distribution of its products.The products of the company are seen and known in every nook and cranny of the southern part of this country, as well as in some northern states.
STATEMENT OF THE PROBLEM
The objective of every company is to achieve its sales volume target, because, if achieved, other performance indicators like growth and totally committed to Niger curse e.g. Entertainment. As a company that has been in the business of leisure, pleasure and fun for over 50years; Nigeria Breweries Plc has been a major force in the entertainment industry through a vigorous music sponsorship programmes. The underlying philosophy is to bring world classes entertainment to Nigeria to support the role of out brands. International stars like Naughty Nature, Usher; shaggy and Awilo have thrilled Nigerians live in recent time courtesy Nigerian. Breweries star mega join and legend fun Rampage Nigeria breweries is also involve in discovering and promotional local and budding artistes through the star Quest and star Trek (star sponsored music programmes). This is to give Nigeria entertainers presence in the international science, Nigerian brewery totally committed to Nigeria curse-Tax/social responsibility- Foreign investors: over 50 millo Euros (N706) was invested in Nigeria by Heineken-Employment generation- Environment- To support educational in Nigeria: help in funding of educational and research facilities in institution of high learning e.g. Edu, TCR Fund-Health: they are the major facilitators in the building of sickle cell active by the sickle cell foundation. Again they also support various health institutions through the donation of Blood Bank equipment, child incubators, Boreholes.-
Sports: They sponsor sports like football, chess cycling, athletics, Golf, Table tennis, Law tennis.
Increase in profitability index would be assured. This could be possible or achieved if the company’s product are acceptable to the target market.Product advertising therefore plays the invaluable role of informing and educating buyer or consumers about some products, what the products do and how they can satisfy their needs and wants.
In addition, product adverting enhances the response of potential buyers to an organization and its offerings. This it does by providing information, channelizing desires and by supplying reasons for preferring the product being projected. In spite of the invaluable role of product advertising in achieving the sales volume target of companies, it still grapples with some problems that need to be addressed. It is sad to observe that most companies operating in Nigeria are still inflexible and reluctant to be doing or courageous in their advertising policy. They are so scared of contracting advertising agency acting advertising agency to handle their adverts that at the end of the day they fail to achieve their sales volume target.
Now with the commissioning of its new ultra-modern brewery in Ama Enugu State, unique for its size design and they are still set to impact eve3n more positively in the lives of Nigerian. Besides, most companies are inconsistent with their advertising policy.They contract more than one advertising agency at any given point in time. This makes it difficult to spend same reasonable money on advertising. This is now becoming a common feature in the brewery industry. For instance, one hardly hears of advert concerning old beautiful product like maltex and vita malt. This should be affecting their sales volume target.
Finally, the product advertising policy of some companies are not so effective as to enable it have some impact on their sales volume. Some companies do choose some wrong and ineffective media to execute the advertising policy, hence achieving nothing a the end of the day. All these afore-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.
OBJECTIVE OF THE STUDY
The broad objective of this study is to examine the major effect and the role of product advertising on sales volume. Other operational objective of the study include the following:
i. To identify the common form of advertising being used in the brewery industry;
ii. To identify the common media of advertising used in the advertising industry
iii. To identify how committed breweries are towards advertising their products;
iv. To examine the impact of product advertising on the buying attitude of buyers
v. To examine the effect of product advertising on the growth and profitability of brewing companies;
vi. To examine the relevant of product advertising in product survival and performance
vii. To identify some problems militating against the effective implementation of product advertising in brewing companies; and
viii. To make some recommendations based on the findings of the study.
RESEARCH HYPOTHESIS
The following hypothesis formulated by the researcher will be tested in this study.
i. Ho: product advertising has no significant rote to play in sales volume determination;
Hi: product advertising has a significant role to play in sales volume determination.
ii. Ho: Effective product advertising cannot lead to significant increase in profitability level of a company
Hi: Effective product advertising can lead to significant increase in profitability level of a company.
SIGNIFICANCE OF THE STUDY
As earlier pointed out in this study, product advertising is one of the vital tools used by companies to promote the sale of their products. Its importance in creating immediate impact on the buying attitude of the consumers, as well as in generating demand cannot be over-emphasized. Again this background, therefore, this study will be of some immense significance to companies, especially breweries, advertising agents, consumers and academicians. The information contained in this study will disclose some important functions of advertising to companies. It will further unveil some unique qualities of advertising, its types and its objective to companies. These vital issues on advertising will help companies design or articulate an effective product advertising policy which can achieve their target sales volume.To companies with chequered advertising policy the information contained this study will help them restructure and reformulative it with a view to achieving their objective of increasing demand for their products, actualizing their sales volume target. More so, brewing companies will appreciate the information content of this study, because it will help them to choose appropriate forms of advertising and media to use in implementation their advertising policy.
Further, advertising agents will equally benefit 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 liaising with companies in order to formulate and implement effective product advertising policy of them.
In addition, consumers will find information contained in this study good enough to enable them gain some insight in the concept of product advertising, since they are the main focus of companies advertising policy. Besides, they will realize the need to always listen and or pay attention to adverts in the media because these may reshape and redefine their buying attitude and decision.
Finally, other researchers and academicians will derive some benefits from the information content of this study. This will help them carry out further research on the subject of this study.
SCOPE OF THE STUDY
This focuses on the role of product advertising in sales volume of breweries. It is carried in using the Nigerian Breweries Plc as its case brewing company. In other words, the study focuses on the advertising policy of the company as it affects it sales volume.
Other issues discussed in the study include the types of advertisement and media used by the Nigerian Breweries Plc in carrying out its product advertising policy, the level of commitment of the company towards advertising its products, the impact of the company’s advertising policy on its growth and profitability, and the problems militating against the company’s efforts to implement its advertising policy. The study equally discloses the recommendations made by the researcher.
LIMITATIONS OF THE STUDY
Generally speaking, researchers do encounter some constraints in the course of carrying out academic work(s) or studies. In view of this obvious fact, it is not an a duration to note that he researcher encountered some constraint during the execution of this study. The major constraints encountered by the researcher is the course of this study include the following:
i. The unfriendly attitude of the staff of the Nigerian Breweries Ltd.
ii. Limited finance or fund
iii. Mental and physical stress.The researcher encountered some difficulties in extracting some vital information from the respondents used for this study, who were mainly staff of the Nigerian Breweries Plc. These respondents were initially hostile to the researcher...
