THE IMPACT OF TELEVISION ADVERTISING ON CONSUMER BRAND PREFERENCE FOR SOFT DRINK IN A COMPETITIVE MARKET

(A CASE STUDY OF 7UP BOTTLING COMPANY NIG. PLC, 9TH MILE CORNER ENUGU)

By

EGBUM AUGUSTINA, C.

Presented To

Department of Marketing

ABSTRACT

This research work is designed to examine the impact of television advertising on consumer brand preference for soft drink in a competitive market, with particular reference to 7up bottling company nig. Plc, 9 ^th mile corner, enugu. For the purpose of clarity, this project has been divided into five chapters and the information was gathered through both primary and secondary sources. The introduction was done in chapter one where objective of the study, the statement of the problem, the hypothesis, scope and the significant of the study was done. In chapter two, reviewed some related literature about the topic. In chapter three, the population of the study, the sample size, method of data collection and the data analysis is tool that was used in the research study were discussed. In chapter four, the analysis of data collection by the use of questionnaires and unstructured personal interview was used. The data was analysed using simple percentages and tested hypothesis by the use of chi-square (x²) the summary of the research finding, conclusion and recommendation based on the findings were therefore effective tool in appealing the target market.

TABLE OF CONTENTS

Title page i

Approval ii

Certification iii

Dedication iv

Acknowledgements v

Table of contents vi

List of table x

Abstract xi

CHAPTER ONE

INTRODUCTION 1

11 Background of the study 5

12 Statement of problem 8

13 Purpose of the study 9

14 Significance of the study 10

15 Research questions 11

16 Hypotheses 12

17 Scope of the study 13

18 Definition of terms 13

CHAPTER TWO

20 Review of related literature 15

21 A Brief introduction 15

22 Review of current literature 16

23 Summary of literature review 29

CHAPTER THREE

Methodology

30 Brief introduction 31

31 Design of the study 31

32 Area of the study 32

33 Population of the study 32

34 Sample of the study 33

35 Instrument for data collection 35

36 Validation of the instrument 37

37 Distribution and retrieval of the instrument 38

38 Method of data analysis 38

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS 40

BRIEF INTRODUCTION OF THE CHAPTER 40

41 Presentation and interpretation of data according

to research questions and hypothesis 40

42 Findings 60

43 Discussion of findings 62

CHAPTER FIVE

50 Summary, Conclusion and Recommendation 64

51 Summary of findings 64

52 Conclusion 67

53 Recommendations 69

54 Limitations of the study 71

55 Suggestion for further research 72

References 73

Appendix A 75

Appendix B 76

LIST OF TABLES

Table One: Age of the respondents

Table Two: Sex of respondents

Table Three: Educational qualification/level of respondents

Table Four: Occupation of respondents

Table Five: Contingency table

Table Six: Chi-square

CHAPTER ONE

INTRODUCTION

The beginning of the twentieth Century witnessed an outburst of advertising efforts the bottling companies This outburst was necessitated by the desire to outsell the other in the consumer market, since soft drinks are competitive products In order to maintain a stronghold of their various market segments, or even to widen an existing market, different advertising strategies erupted prominent among them are sales promotions, sales campaign, point of purchase displays, media advertising etc

This rampant use of various advertising strategies in eliciting consumers' response has credited a stiff competition between the manufacturers of soft drinks of which 7up is one Constant inundation of consumers with multifarious advertising slogans has even created confusion in the minds of helpless consumers on which products to buy or leave

Pride and fewel in their book "marketing" explained that an advertisement may a times be informative, or entertaining yet it may fail to get the audience to purchase the product they were of the opinion that the ultimate effectiveness of advertisement is determined by its ability to cause product adoption and high purchases among the potential buyers

The extent of patronage of any advertised product does not entirely depend on the effectiveness of the advertising strategies It might sometimes, depend on extraneous factors like economic status of the prospects, belief system, culture, climate, level of education etc For instance, it will be an exercise in facility to advertise liquor in a predominantly Moslem state of Kaduna and Zamfara This is because the consumption of liquor is against their Islamic belief system

Similarly, advertising of such luxury goods like vacuum, cleaner, TV set, electric cooker to a predominantly nomadic population will be a wasteful venture In the above cases, values and economic status respectively play vital roles in changing the people's behaviour towards accepting advertised product(s)

Advertising is a communication between sellers and buyers with the sole aim of changing the attitude of buyers From the above definition, it could be deduced that advertising is communication especially from the producers to the target market about a product or organization with the hope of creating awareness, interest, desire and a patronage of the product

Erickson (1962) defined advertising as "Truth well told" The American Marketing (AMA) said that advertising is "any paid non personal presentation and promotion of ideas goods and services by an identified sponsor"

This means that advertising messages are beamed at a group of people that are not personal in nature Note worthy is the fact that an advertising channel is selected according to its suitability in researching the prospects Eg Newspapers and Magazines advertisement may not be helpful in researching an illiterate segment According to this research, the Nigeria Mineral water industries Limited Markets of 7up have used almost all the advertising channels mentioned above to reach their audience However, in order to arrive at a satisfactory result, only Television may be analyzed here as it affected 7up consumption

11 BACKGROUND OF THE STUDY

Nigeria Mineral Industry Limited established in 1959 by the ENDC (Eastern Nigeria Development Cooperation) the company commenced production in 1960 with Pepsi range of products The productions operation of the company halted for three years due to Nigeria / Biafran War - (1967 - 1970) The company started operating in 1971 after restructuring with product of Tango brand of soft drinks In 1976, the company stopped the production of Tango and changed over to sun sweats range of products In 1987, Nigeria Bottling Company (NBC) launched an aggressive sales promotion campaign on one of their product called SPRITE with their Animal Kingdom Game The 7up Bottling Company in 1989 came up, with "it is Raining Again" slogan, which came after the 1988 "Naira Ram" and the 7-up Bottling Company with the intention of maintaining its stronghold, increasing sales, penetrating into new markets and increasing shares of the entire market among the competing firms In the Animal Kingdom Game, the slogan my choice is clear - Sprite! Rent the air and some incentives were provided to the buyers or consumers of Sprite, this advertisement strategy seemed to have had an adverse effect on the 7-up brand of soft drink hence a greater segment of the market was thought to have been won by the Nigeria Bottling Company Consequently, the 7-up Bottling Company launched a counter attack in 1989 with the slogan "The difference is clear" 7 - up

With the above slogan, it appears as if buyers' attention was shifted to the product As a result, the competition between the Nigerian Bottling Company and 7-up Bottling Company became so keen that both of them today engage in under use of various advertising strategy to market their products and return their customers Some critics are of the opinion that acceptance of a product is a multi - step process and since promotion advertising is only one part of the marketing mix, single promotional activity can rarely cause an individual to buy a previously unfamiliar - product However, it is generally believed that advertising is necessary in the product - adoption process More especially now that there are several product manufacturing companies, with each jostling for attention The awareness of the existence of such product can only be created through venous advertising strategies In line with the aforestated, the Nigeria Mineral Water Industries Limited markers of 7up soft drink in 2000 launched an extensive sales campaign titled "7up pop a top promotion" The intention was to widen an existing 7up market through incentives Consequently, the objective was realized as 7up recorded higher sales and increased preference after the advertisement and sales campaign

12 STATEMENT OF THE PROBLEM

i Low awareness about television advertising of 7up bottling company's products

ii Low access of consumers to television facilities

iii Wasteful advertising campaigns by bottling companies

iv Unhealthy rivalry amongst companies advertising their products

13 PURPOSE OF THE STUDY

i To ascertain of consumers are aware of the adverts of 7up bottling company

ii To find out if consumers have easily access to television facilities

iii To ascertain if advertising campaigns by bottling companies are wasteful

iv To find out if there is unhealthy rivalry amongst bottling firms

14 SIGNIFICANCE OF THE STUDY

The presentation of vital information on the impact of television advertising on consumer preference will be very important in many aspects it will help to reveal some major advertising constrains that mediate against consumers preference for soft drink in a competitive market When the effects are analyzed and comprehended, it will help the industrialists involve and other their related counter-parts to find the best way to avoid the following constraints:

1 The information collected will tremendously enhance the students performance who intends to carryout research on the impact of television advertising on consumers preference for soft drink in a competitive market

2 The study will expose them to these role-played by television advertising in a completive market

3 The study will provide a strategic television which is consumer oriented and which is also aimed at generating, consumer preference Consequently the company will be opportune to have a high profit margin

4 On the side of government, the study would help pin point to the long awaited method of promotion television advertisement

15 RESEARCH QUESTIONS

i Do consumers likely to prefer 7up brands of soft drinks?

ii Has the Nigerian Mineral Water Industries Limited, Makers of 7up embarked on any of advert?

iii Did the advertisement increase the consumers demand for 7up?

iv Does 7up been able to maintain its hold on the market at the advertisement or sale, campaign programmes?

16 RESEARCH HYPOTHESIS

Hypothesis one

Ho: Consumers do not prefer 7up to other brands of soft drinks

Hi: Consumers prefer 7up to other brands of soft drinks

Ho: 7up has been able to maintain its hold on the market at the end of the advertisement or sales campaign programmes

Hi: 7up has been able to maintain it holds on the market at the end of advertisement or sales campaign programmes

17 SCOPE OF THE STUDY

A good research needs to be delimitated to a manageable scope This research covers the impact of television advertisement on consumer preference for soft drink in a competitive market using 7up-bottling company, Enugu

18 DEFINITION OF TERMS

Advertising: Any impersonal form of communication about ideas, goods or services that paid for by an identified sponsor

Brand: A name, term, symbol, design or combination of these elements that feature as differentiating measure of goods or services from one seller to another seller offerings

Campaign: An organized trend of promotional efforts built around a theme and designed to reach some goal

Market segmentation: The process of dividing the total market into one or more parts (sub-markets or segments) each of which tends to be homogeneous in all significant aspects

Consumer market: Consists of buyers who use the product to satisfy personal or household need