TABLE OF CONTENTS
TITLE PAGE – – – – – – – – i
CERTIFICATION – – – – – – – ii
DEDICATION – – – – – – – – iii
ACKNOWLEDGEMENT – – – – – – – iv
ABSTRACT – – – – – – – – – ix
TABLE OF CONTENT – – – – – – – v
CHAPTER ONE: INTRODUCTION
- Background of the study – – – – – – 1
- Statement of problem – – – – – – 2
- Objectives of the study – – – – – – 4
- Research questions – – – – – – 4
- – – – – – – – – 5
- The scope and limitations of the study. – – – – 5
- Profile of Nestle plc – – – – – – – 6
- Products of Nestle plc – – – – – – 9
- Significance of the study – – – – – – 9
CHAPTER TWO: LITERATURE REVIEW
2.1 Evolution of Advertising – – – – – – 14
2.2 Nature and Scope of Advertising – – – – – 16
2.3 Importance and Role of Advertising – – – – – 20
2.4 Classification of Advertisement – – – – – 23
2.5 Media Selection – – – – – – – 24
2.5.1 Overall Campaign Objective/Strategy – – – – 24
2.5.2 Characteristics of Medium audience – – – – 24
2.5.3 Exposure and Attention – – – – – – 25
2.5.4 Cost Efficiency – – – – – – – 25
2.6 The Marketing Environment – – – – – 26
2.7 The Company’s Micro Environment – – – – – 26
2.8 Markets Intermediaries – – – – – – 28
2.9 Nutrition Programme – – – – – – – 29
2.10 Nestle in Community – – – – – – – 30
2.10.1 Nestle and Health – – – – – – – 31
2.10.2 Nestle and Education – – – – – – 33
2.10.3 Nestle and Entertainment – – – – – – 34
2.10.4 Nestle and Sports – – – – – – – 35
References: – – – – – – – – – 37
CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Introduction – – – – – – – – 39
3.2 Research Design – – – – – – – 39
3.3 Sources of Data Collection – – – – – – 40
3.31 Primary Data – – – – – – – – 40
3.32 Secondary Data – – – – – – – 41
3.4 Characteristics of the Population Study – – – – 41
3.41 Sampling Design Procedures and Determination of the Sample Size 41
3.42 Determination of the Sample Size. – – – – – 41
3.43 Questionnaire Designs Distribution and Collection of Responses 42
3.5 Procedures for Data Processing – – – – – 43
3.6 Limitation of the Methodology. – – – – – 43
CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS
4.1.1 Presentation and Analysis of Data – – – – – 44
4.1.2 Responses to ascertain whether customers become aware
of the existence and availability of products through Advertising. – 45
4.1.3 Responses as to whether Advertising is necessary. – – 46
4.1.4 Responses as to users of Nestle Nigerian plc products – – 46
4.1.5 Responses to the most influential medium – – – 47
4.1.6 Responses according to Manufacture – – – – 47
4.1.7 Responses as to how often the company Advertises. – – 48
4.1.8 Responses as to product mostly advertised. – – – 49
4.1.9 Responses according to distribution – – – – 49
4.10 Electrical Advertising and Purchases – – – – 50
4.11 The estimate of Advertising expenditures – – – – 50
4.12 Responses as to why the company Advertise. – – – 51
4.2 Presentation and Analysis based on research questions. – – 51
CHAPTER FIVE: SUMMARY OF FINDINGS, RECOMMENDATIONS
AND CONCLUSION
5.1 Summary of Findings – – – – – – – 56
5.1.2 Relationship between Advertising and Marketing of
Consumer Goods. – – – – – – – 57
5.2 Recommendations – – – – – – – 57
5.3 Conclusion. – – – – – – – – 58
5.4 Recommendation for future Research – – – – 58
Bibliography – – – – – – – – – 60
APPENDIX A – – – – – – – – 63
Questionnaire to the Manufacturers – – – – – 63
APPENDIX B – – – – – – – – 67
Questionnaire to the Consumers – – – – – – 67
ABSTRACT
On a daily basis, advertising messages are churned out to the general public through the electronic media, print media and outdoor media. The overall objective is to get the general public to be aware of their products, services and ideals.
The general public on the other hand is conservative, skeptical and hard to shift from established habits. Some do not even pay attention on commercials on our various media. In the face of all these, the originators of advertising messages spend and/or budget handsomely to get their messages across. This research therefore attempts to bring to attention the influence of advertising to both manufacturers and consumers alike. Nestle foods Plc was used to demonstrate how businesses stand to achieve their corporate objectives through advertising and how consumers’ standard of living is enhanced.
Both primary and secondary data were employed in this endeavour. Primary data have been collected through personal interviews and administration of questionnaires while secondary data have been on information sought through readings from Nestle Newsletter, related textbooks, articles in Newspapers and Magazines, seminars and journals.
Hypotheses have been formulated to test statistically, our findings. In the final analysis, it has been concluded that, though advertising is relatively new with us, the overwhelming influence on consumers and importance to manufacturers cannot be ignored.
The following hypotheses were formulated and statistically tested at 5% level of significance.
The first hypotheses state that: HO. Advertising does not promote sales even if it creates high impact among customers.
HI: advertising promotes sales only if it creates high impact among customers. Moreover, the second hypotheses states that:
HO: Advertising objectives cannot create awareness even if there is confirms evaluation of different media from time to time.
HI: Advertising objectives create awareness among customers. But there should be only a continuous evaluation of the effectiveness of different media from time to time.
Furthermore, the researcher was able to make the following findings.
- Advertising creates awareness and influences purchases of consumer products.
- That there is relationship between advertising and sales of consumer products
- Advertising is not only instrumental in building brand image but also nourishes the consuming power of man by creating wants for a better standard of living.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Advertising to some people is seen as being vital to commercial success while others see it as mere waste of time and energy. However, while advertising cannot be readily measured in terms of quantifiable results its effectiveness cannot be denied. To break into a market with a new product is not easy. The world does not beat its way to the better mousetrap. Novelty is not enough nor is quality obvious desirability.
The buying public is conservative, apt to be skeptical and hard to shift from established habits. For a firm to sell sufficiently of the products produced within a reasonable time, it must obviously let customers and potential customers alike know that the product exists, buy their special characteristics, the uses buyers can make of them and the best way they can be utilized and how the product can be purchased, ordered or hired.
Advertising is used either privately or in business. Most people respond to it and so enjoy the choices available to them in every sphere of life. Whether we want to sell a private house dispose of kittens, raise fund for a charity, sell the production of a million Naira business, buy a second hand tape recorder, attract shoppers to our stores, launch a new product, engage a staff or simply find a Pen friend, the technique is the same. It is one of the major promotional tools used to reach consumers/customers.
Advertising tends to be more important where products are not complex and many customers are potential buyers. An advertisement must therefore attract customer’s attention. Once it has achieved this it must further attract their interest for a sale to take place however, a desire for the product must be established in the consumer’s mind.
1.2 STATEMENT OF PROBLEM
The commercial importance of advertising has not been fully appreciated by the average Nigerian marketer and the community at large. Perhaps many advertisers in Nigeria still do not know what advertising can do and what advertising cannot do. This is as a result of the fact that the subject is relatively new in Nigeria. Advertising is a necessary condition for the flow of information between producers and consumers. It is a non – personnel form of communication, conducted through paid media and under a clear sponsorship.
For a firm to achieve profit maximization adequate sales must be made over a reasonable time. Manufacturers or marketers therefore are faced with the problem of informing prospective buyers of the availability of the product or services, of the uses buyers can make of them, and in many instances of how to use the product or services.
To do this effectively, advertising has to be bold, dramatic, persuasive and convincing, whether it is a complete innovation like a convenience food or an entirely new kind of car. In addition, the effectiveness of advertising must depend on important decisions about the correct media, adequate message, accurate timing of advertisement and advertising budget. However, not every advertisement medium can accomplish all four of these aims at the same time, nor need it be expected to do so. Obviously, a billboard poster can carry less information than a newspaper page.
Advertising as a concept is not without some limitations. Though manufacturers have control over their advertising and it is less expensive than per its reach, feedback is difficult and when if at all it comes, it is very often late. In addition, some of the advertising messages are misleading and untrue and do not give room for needed information. A negative influence is achieved when an advertisement is perceived as offending, misleading or annoying. An advertisement may be perceived as morally wrong in some sense and at times may seem to pollute the consumers’ mental environment. Some advertising messages are also wrongly timed as children and the under-aged are exposed to morally unhealthy information. This is exemplified by current family planning and AIDS advertisement on the television, which is seen as unhealthy for the morality of children.
At times also, there are certain things that some consumers believe should not be aimed in then public. This type of advertising message is looked at as a moral outrage in advertising. Moreover certain advertisements make people develop a taste for certain products, which they cannot afford. Therefore, since Modern Corporation depends on effective communication for survival and success, it is important to investigate the importance of advertising in the marketing of consumer goods.
1.3 OBJECTIVES OF THE STUDY
The main purpose of advertising is to create awareness for product and services, arouse interest, build a desire and consequently get customers on a favourable state of mind to a decision to purchase the product. The anticipating end result is to achieve maximum profit, which is applicable to only trading companies. The objects of this study are to understand.
- From the point of view of consumers:
- How advertising helps in the awareness stage and consequently to a decision to purchase
- How the general standard of living of consumers is enhanced by the creation of such awareness.
- How advertising has made it possible to have a variety of goods to choose from.
- B. From the point of view of manufacturers
- How advertising increases sales
- How advertising maximizes profit
- How advertising expands the market share of the company.
1.4 RESEARCH QUESTIONS.
I Does advertising promote sales only if it creates high impact among customers.
- Is advertising objective to create awareness among customers if there is a continuous evaluation of the effectiveness of different media from time to time?
- Does market expansion needs special advertising efforts, which can only be achieved if there is proper planning of advertising scheme?
1.5 HYPOTHESIS.
The following hypotheses have been formulated.
Ho: Advertising does not promote sales even if it creates high impact among customers.
Hi: Advertising promotes sales only if it creates high impact among customers.
Ho: Advertising objectives cannot create awareness even if there is continuous evaluation of different media from time to time.
Hi: Advertising objective is to create awareness among customers. But there should be a continuous evaluation of the effectiveness of different media from time to time.
1.6 THE SCOPE AND LIMITATIONS OF THE STUDY.
This study is an attempt to know the benefits of advertising in the marketing of customer goods. It does not attempt to cover whole areas of advertising. The study is restricted to advertising of customer goods only. Consumer goods are goods purchased and consumed by the consumers for his own or his family gratification. They are normally less technical and often bought mostly on the basis of brand names.
The study is also narrowed down to product advertising as opposed to institutional advertising. Product advertising is aimed at informing about and promoting the benefits of a product or service to potential buyers. Products advertising emphasizes product as against institutional advertising, which is aimed at placing emphasis on the company and its philosophy.
Furthermore, request for information has been narrowed down to a major manufacturing company with distribution unit in Lagos town. This organization
Nestle Nigeria Plc – stand as a case study for this thesis. The finding of this study
may be valid for Nigerian only.
The study should have been extended more than this if not for the limitation and constraints faced during the research. There were the problems of contacting businessmen, secrecy of the organization, lack of access to related documents, finance and time available to the researcher.
1.7 PROFILE OF CORPORATION USED AS A CASE STUDY.
Nestle Nigeria is part of the Nestle group, the respected and trustworthy food, nutrition, health company renowned world – wide for its top quality products.
Nestle Nigeria was established in 1961 and has today grown into a leading food manufacturing and marketing company.
Nestle Nigeria plc was listed on the Nigerian stock exchange on April 20, 1979. As at December 2003, the number of Nigerian shareholders was 22,843. Today, Nestle S.A. of Switzerland owns sixty – two percent of the company’s equity.
The strategic priorities of the company are focused on delivering shareholder value through the achievement of sustainable capital efficient and profitable long-term growth. Nestle Nigeria has an impressive array of top quality brands: infant cereals – Nestle NUTREND, Nestle CERELAC and Nestle CERELAC WHEAT BEANS; an instant family cereal Nestle GOLDEN MORN; beverage drink Nestle MILO; bouillons MAGGI CUBE, MAGGI CHICKEN. MAGGI CRAY FISH and MAGGI MAXI CUBE.
Nestle Nigeria also markets coffee NESCAFE; full cream milk product Nestle NIDO.
These brand and products are the focus of continuous innovation so that they meet and exceed our consumer’s expectations. The company seeks to achieve a clear – cut advantage over competitor’s products and to ensure that its products are available wherever, whenever and however the consumers want them.
Continuous attention is given to developing the professional and leadership skills of staff at all levels so that they can directly contribute to growth and a higher level of performance.
Nestle is a socially responsible corporate citizen. Nestle S.A Switzerland, parent company of Nestle Nigeria, Donated CHF3 million to the International Federation of Red Cross/ Red Crescents Africa health initiative (ARCHI 2010 protect) to prevent transmission of HIV through increased AIDS awareness in Nigeria.
The programme targets 1.2 million youths through 2,640 peer educators in 12 states. In furtherance of it’s commitment to good corporate philanthropy, Nestle Nigeria donated food products worth about N5million to the victims of the September 2003 flood disaster in Kaduna.
Nestle Nigeria continues to contribute to the development of sports by sponsoring many sporting events and programmes: Nestle MILO secondary school Basketball championship, Nestle MILO future champions tennis clinic and the Nestle MILO friendly schools funfair. The company also promotes Nigerian food culture through the MAGGI family menu television programme, the Annual magi national cooking competition and MAGGI women forum.
The company above promotes Nigerian little culture through the MAGGI family menu television programme the annual magi national cooking, competition and MAGGI women forum.
Furthermore, as the work leader in good food and nutrition, the activities of Nestle S.A. in research on human nutrition and food technology have led to the accumulation of a huge capital of nutritional know how. In furtherance of it’s commitment to nutrition education, Nestle Nigeria sponsors the following programmes: nutrition seminars and workshops, Nestle’ nutrition media Award, Nestle Duchess club and Nestle nutrition lire on Radio (fire minute’s daily nutrition tips)
In pursuit of its sustainable agriculture initiative (SAI) Nestle Nigeria is involved in collaborative research with the University of Agriculture, Abeokuta (UNAAB) on popularization of soyabeans. The company embarked on an on the farm adaptive research with UNAAB, which brought into being a selection of soyabeans varieties with improved weed colour, seed size and seed yield. Some local farmers in the southwest region of Nigeria were encouraged to use sustainable farming techniques in planting the improved soyabeans varieties. The company is also involved in a joint venture with the International Institute of Tropical Agriculture (IITA), Ibadan on propagation and development of improved cowpea seedling with high protein content.
With its historical root in nutrition, wide product portfolio, strong trends, research and development competence, skilled and motivated professional and efficient management, Nestle Nigeria is uniquely positioned to continue to contribute to the progress, prosperity and economic development of Nigeria.
1.8 PRODUCTS OF THE NESTLE Nigeria PLC.
Good food, good life. This has been the Nestle Nigeria plc slogan one the years. In 2003, a survey complied by Hay group, a management consulting company ranks Nestle 10th overall in further’s 2003 survey of “The world’s most Admired companies”.
In 2002, Nestle took first place in the consumer food products category. Nestle Nigeria has an impressive array of top quality brands: Infant cereals Nestle NUTRIEND, Nestle CERELAC and Nestle CERELAC WHEAT BEANS, an instant family cereal Nestle GOLDEN MORN; beverage drink – Nestle MILO; bouillon MAGGI CUBE, MAGGI CHIKEN, MAGGI CRAYFISH and MAGGI MAXI CUBE. Nestle Nigeria also markets coffee NESCAFE; full cream milk product. Nestle NIDO.
1.9. SIGNIFICANCE OF THE STUDY
It is the considered opinion of this researcher that the findings and recommendations from this research work will assist companies in the best way to achieve the objectives of increasing its sales and maximum profit. The work will also assist companies on the best way to set advertising objectives. These objectives should be based on past decisions about the target market, positioning and marketing mix.
Furthermore, companies will be more informed on the best way to select media to be used. An advertising message to achieve the desired exposure, attention and consumers to a decision to purchase, the right media must be matched with the right audience at the right time in the best environment in the most logical place.
Potential customers will become aware of a new product, uses of the product, market price of the product and how the product work.
- DEFINITION OF TERMS
CONSUMER GOODS
As the name implies consumer goods refer to goods purchased and consumed by consumers for their own or their family’s satisfaction. Consumers goods in turn are generally broken down into three groups namely.
- Durable goods such as automobiles, stores and washing machine.
- Non-durable goods such as clothing, food and drugs
III. Services such as media, legal, educational and personal.
CONVENIENCE GOODS
These are low-cost highly advertised items that are designed for the mass market and are sold to all income classes. They are low in price, bought mainly on the basis of brand names and commonly sold to consumers on a self-service basis.
Convenience goods include cigarettes, chewing gums, milk, bread and a host of staple grocery items. Consumers wish to buy such goods with a minimum of effort and will not shop.
SHOPPING GOODS
These are goods for which consumers are willing to shop. They go from shop to shop and from items to items within a store, comparing price, qualities, terms services, fashion and so on. There are two basis types of shopping goods- fashion goods and service gods?
Fashions Goods (heterogeneous shopping goods) are products that the consumers believe are non-standardized and that wishes to inspect for quality and adaptation to theirs want. Clothing, furniture and diapers are good examples. Styles to fashion are important. Fashion goods are higher priced than convenience goods and generally are supported by less brand advertising service consumers wish to make their own comparisons rather than to shop on the basis of brand names. Consumers want variety in colours, sizes, fashion and so on and they can pick and choose.
Service Goods (homogenous shopping goods) are durable items that usually require services such as small appliance, refrigerators, automobiles and television sets. These goods often have a fashion element to them. Consumers buy service goods mainly on the reputation of the manufacturer as embodied in its brand name because they are generally unqualified to judge the merits of the products for themselves. Price is of great importance, since many of these products are high-priced, and the product within a product class may be judged to be about equal in quality. Trade-ins may be of significance because of their effect on price delivery, installation, repair service and credit, which are often expected.
SPECIALTY GOODS
These are products that a significant number of buyers want and will make a special effort to buy. Buyers exhibit brand insistence and purchase on the basis of brand name. These goods may or may not be expensive and readily available but for which the consumers refuses to accept any substitutes. Example – Bayer aspirin, panadol. Since specialty goods are well known, publicity is of little value.
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