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The Impact and strategies of Promotional Activities on Customer Purchasing Behaviour

Abstract

 Marketing is a very important aspect of business, because it contributes to a large extent to the overall success of the organization, thus production and distribution depends exactly on it. Promotional activities and other relevant factor of purchasing decision making attracts customers to at least try the product, and then decide if the quality meet the necessary requirements of their needs and demands. This paper addresses the aspect of promotion strategies and the activities of bottled water with the aim of keeping existing customers and attracting new ones.  The purpose of this paper is to analyze the impact of promotional activities during the decision making process and the buying behavior of bottled water, which is focused basically on two major producers of bottled water in Kosovo. These producers are company BONUS from Prishtina with bottled water brand BONITA and company UNIOR Aqua, which is a branch of UNIOR from Slovenia, producing bottled water in Kosovo with brand RUGOVE.  Both companies produce different types of bottled water in PET and glass packaging and are very committed to meeting the needs of the market, and are also committed to the trend of introducing new products or improving existing ones towards the market needs. For the purpose of this paper, we conducted a research through questionnaires. Questionnaires were distributed directly and through the use of email to the end users. 200 questionnaires were distributed for this purpose and feedback was gotten on 150 questionnaires. Target groups selected for interview were of different ages and different professions. Limitations were made only on age and for the purpose of this research, the age under 18 years were excluded. Research was conducted in the main cities of Kosovo and was done in the period between the month of April and June 2013.   Keywords: Promotion, advertising, sales promotion, price, quality.

Introduction

Manufacturers of bottled water in Kosovo often face the problem of identifying and implementing a proper marketing strategy on marketing their products and the business of their company as a whole. Thus, the good combination of four elements of marketing, known as marketing mix elements which comprises of production, price, distribution and promotion is the requirement for effective selling and customer satisfaction. Both companies as part of this study research, has done an excellent combination of elements of the marketing mix, in particular, the element of the promotion and promotional activities which has contributed in gaining a market share and do extend and develop new markets within the entire Kosovo market which also include markets of regional countries such are Albania, Macedonia and Montenegro. Production of bottled water in Kosovo is facing huge competition by domestic producers and also from other producers from EU countries especially from neighboring countries. Today, there are several small and medium size companies that are producing goods and replacing imports, but only few of them are exporting into the markets of regional countries (mainly in Albania and Macedonia) and Western European market144. Two companies which are part of this research are both exporting in the markets of EU and neighboring countries. As research has shown, both companies today rely on the quality of their products rather than on price competition. They are very well known within the Kosovo markets and their customers and consumers of water are loyal customers only because of the good quality of their products. Promotional activities played a very good role on the early phases of penetration into the Kosovo market, but nowadays, they are keeping customers and gaining new customers through quality products delivery which is fostered by advertisements on the main Kosovo media, both the electronic and the printed media. Advertisements of the range of products, followed by customized advertising and audiovisual spots which attract the attention of consumers, have led to the increase in sales volume and in the numbers of customers. Thus, this has helped in building a strong brand image of these two manufacturing companies and their brands in comparison to other bottled water producing companies in Kosovo. Company BONUS145, which produces bottled water by brand name BONITA, has on it assortment of production, natural mineral water and carbonated water on PET and glass packages of different sizes such as: 0.25l, 0.5l and 1.5l and also on Can package of 19.5l, which is used mainly for commercial purposes. Company UNIOR Aqua146, which produces bottled water by brand name RUGOVE, produces only natural mineral water also on PET and glass packages of different sizes, such as: 0.25l, 0.5l, 0.75l, 1.5 l and 6.0 l, which is known as 5+1l model.

Literature Review

 The term “marketing concept” summed the business philosophy of a company, institution or individual that is characterized by the concentration or focus on the customer, expressed through constant effort and harmonious whole enterprise in a bid in meeting the needs and desires of consumers and its objectives of the enterprise 147. In 1954, Peter Drucker pointed out very clearly the role of marketing for the company’s success. Even in today’s time, marketing as a concept has value and viability which is uncontested: “If we want to know what our job is, then we should start with the mission … There is only one correct definition of the mission of an enterprise: customer satisfaction. What the company intends to produce is not of primary importance-especially not to the future and its success. What is crucial is that the customer intends to buy; or what represents value-this defines what is your enterprise, what does it produce and whether it will prosper. “148 The term marketing used in everyday life ranges from media to communication with the public, meetings and talks business profile in various speeches up to social conversations of ordinary people. Often, the marketing term is not used and defined in appropriate way and there are much confusion from individuals and groups which are not associated with marketing.                             145 http://www.bonusbonita.com 146 http://www.ujerugove.com  147 Lisanin, M.T.: Bankarski marketing, Informator, Zagreb, 1997, 8. 148 Drucker, P.: The Practice of Management, Harper & Row, New York, 1954, citat in page 37 of  Evans, J.R.& Berman, B,   Marketing, New York, 1987

European Scientific Journal   November 2013  edition vol.9, No.31  ISSN: 1857 – 7881 (Print)  e – ISSN 1857- 7431 468 To better understand marketing and define it as it is, a well-known authors, Kotler and Keller (2012)149, defines marketing as follows: ”Marketing is a social and managerial process whereby individuals and groups obtain what they need and what they want through creating and exchanging products and value with others “” Marketing mix is defined as the set of instruments and controlled tactical marketing strategies combined by an enterprise in order to meet the needs and satisfaction of its customers. Marketing mix consists of elements which the company can apply so as to influence the increasing demand for its products. Multiple options can be grouped in four variables or instruments known as the “4 Ps”:  Product, Price, Place, and Promotion.  Promotion is defined as the coordination of all the efforts of vendors to create channels of information and persuasion in selling their goods and services, or to promote the idea. Therefore, promotion mix is a basic tools used for communication, with the aim of promoting the goods as well as the services offered by the organization150. This is presented in the figure below: Figure1. Promotional mix    Source: George E. Belch and Michael A. Belch, Advertising and Promotion (The McGraw-Hill Companies, 2003), page 16.

Methodology

The object of the research was to identify and assess the role and impact of promotional activities on purchase decision making as the case of two major bottled water producing companies, represented in the paper by their brand names BONITA and RUGOVE. Firstly, a questionnaire based on survey was prepared, and the results were analyzed in this research. Some of the most important questions are also part of this paper. Main methods which were used in this paper are the descriptive method, the method of comparing companies, analyses method, and the synthesis method. For the purpose of this paper, we conducted a research through questionnaires. Survey questionnaire was used as the main research instrument and questionnaires were distributed directly and by email to customers of bottled water. 200 questionnaires were distributed for this purpose and feedback on 150 questionnaires was gotten. Out of 15 questions prepared for questionnaire, a total of 8 questions were part of this study. The target groups selected for interview were of different ages and of different pes)  c) Sometimes  Table1. Consume or no bottled water?   A response received from the second question represents an indicator differences in the numbers of customers for specific brands part of this study. While for bottled water BONITA, 28 people stated that they are consumers of this brand, for bottled water RUGOVE, 55 persons declared that they do consume water of this brand which is almost double of the customers when compared with BONITA. Thus, the rest of the respondents stated that they are customers of other brands, such as brands: Miros, Dea, Akulli, RADENSKA, Alpeve, etc. 2.Which brand of water do you buy? a) BONITA b) RUGOVE c)  Other Table 2. Brand of water customers buy  Nr. % a) YES 130 87 b) No,( from the city pipes) 8 5 c) Sometimes 12 8 Total 150 100  Nr. of customers % a) BONITA   28 20 b) RUGOVE   55 39 c) Other 59 41       Total 142 100 As shown by the response gotten from consumers of both brands; for BONITA, the main reason to buy is packaging (12 consumers), for price 8, quality 2 and for other reasons, 6 consumers (e.g. for having it close to customers).Another case is water brand RUGOVE where over 50% of consumers stated that they purchase RUGOVE water due to its good quality, since the geographical position of the source of water is being perceived as a key element of water quality. Thus, the rest of the consumers (10 of them) buy RUGOVE water because of price, or because of other reasons such is appropriate location to buy. 3.What are the reasons pushing you to purchase products of these brands? a) Price b) Quality c) Packaging d) Other Table 3. Reasons for purchase?   The responses from the question submitted have been interesting and have a connection with previous questions because for water BONITA, majority stated that promotion was the reason that convinced them to buy the product, while for water RUGOVE, 22 of them, stated they buy it because of the satisfaction after using the product. For water BONITA, a second reason was satisfaction after the first use while for water RUGOVE, the promotion is in second place with 18 positive responses and very close to it is “the word of mouth”, in 15 responses. 4. What did convince you to consume the products of these brands? a) Promotion b) Word of mouth c) Satisfaction after the first use of the product Table 4. Reasons for conviction    BONITA RUGOVE OTHER a) Price 8 10 12 b) Quality 2 30 40 c) Packaging 12 5 5 d) Other 6 10 2       Total 28 55 59  BONITA RUGOVE a) Promotion 14 18 b) Word of mouth 3 15 c) Satisfaction after first use 7 22 d) Other 4 0Total 28 55 When asked from which media they heard about these brands, majority of respondents answered that it was from TV commercials for both brands BONITA and RUGOVE. Billboards and newspapers were the second media of promotion for BONITA, while Radio is the second media for RUGOVE, while newspapers and billboards are behind them. Other, in both cases is promotion through social media. 5. From which media have you heard about these brands?

a) Newspapers  b)  Radio c)  TV d)  Billboards e) Other Table 5. Media from which customers heard   In the next question, in trying to get answers about media and their role on purchase decision, the majority for both brands declared with Yes. Hence, in BONITA case 20 out of 28 consumers while at RUGOVE 34 out of 55 consumers. Second answer, sometimes, was gotten from 6 consumers at BONITA and 16 of them from RUGOVE, while the respond of making them curious to try the product for BONITA, we had 2 responds and for RUGOVE 5 responds.  6. Does the advertisement of the water producers impact your decision while buying their products? a) Yes  b) Sometimes  c) Makes me curious to try the product   Table6. Impact of advertisement on purchase decision   BONITA RUGOVE a) Newspapers 5 5 b)  Radio 3 15 c)  TV 12 26 d)  Billboards 5 5 e)  Other 3 4               Total   28 55  BONITA RUGOVE a) Yes 20 34 b) Sometimes 6 16 c) Makes me curious to try it   2 5 Total 28 55

References:

Lisanin, M.T.: Bankarski marketing, Informator, Zagreb, 1997 Drucker, P.: The Practice of Management, Harper & Row, New York, 1954 Kotler. Ph & Keller K. Marketing Management, 14th E., Prentice Hall, New Jersey, USA,2012 George E.  Belch  dhe  Micheal  A.  Belch,  Advertising  and Promotion  The McGraw-Hill Companies, 2003 European Scientific Journal, Vol.9, May 2013 edition vol.9, No.13 Day & S., G. Market driven strategy : processes for creating value. New York London C: Free Press; Collier Macmillan. 1990. Kotler Philip and Keller Kevin Lane. Marketing Management, 14th E., Prentice Hall, New Jersey, USA, 2012 Igal, Karin, Kenneth, & Preiss. 2002. Strategic marketing models for a dynamic competitive environment. Journal of General Management, 27(4): 63 Whalley A., Strategic Marketing,  Andrew Whalley & Ventus Publishing ApS, BookBoon, London 2010, quoting Luck, Ferell& Lucas 1989 and Boyd &Walker1990 Wilson R.& Gilligan C., Strategic Marketing Management, Third Edition, Elsevier, London, UK, 2005 Walker & C., O. 2003. Marketing strategy : a decision-focused approach (4th ed.). London: McGraw Hill http://www.bonusbonita.com http://www.ujerugove.com

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