CHAPTER ONE

INTRODUCTION 

1.1. BACKGROUND OF THE STUDY  

In agrarian self sufficiency period, people were engaged in direct production of what they could use. In these primitive agrarian societies, there was no need for marketing activities since every household satisfied its needs without much exchange. As societies and their economic developed from agrarian self sufficiency to urbanization, industrialization and division of labour, the need for marketing activities or tools arose. With the beginning of the era, people began to specialize in the production of items thereby producing much more than their personal requirement and since they had need for other materials which they cannot produce as a result of their specialization, the need for exchange became obvious. Thus, the surplus brought about the large scale production laid the foundation for trading tools or activities. 

At the initial stage, production and exchange were simple and mainly in the need and requirement amongst close neighbours, but the small specialized producers increase their output in anticipation of future orders and this gave rise to the need for idea of middlemen to help them dispose off goods by acting as intermediaries between them and the buyers.

Development of marketing activities were fuel by the individual revolution when small handcraft operation became factors and the rate of urbanization increase as a result of people moving into work in the factories. Later both the middlemen and the provider felt the need for more profit through high volume sales and creation of consumer. 

By the beginning of 1930, most especially in United State of America such development had necessitate for increase in production but high volume sales were only possible if the selling of the enterprises were able to gain patronage. By the time under reference, some companies in Europe had started grouping such function as product development, packaging, physical distribution and warehousing; and linking them with sales and advertisement (promotion) under one executive. 

Therefore, the British Marketing Institute defined marketing as a management process responsible for identifying, anticipating and satisfying customers requirement profitability, whereas the American

Marketing Association considers it as the performance of business activities that direct the flow of goods and services from the producer to the consumer. In line with the above definition, the producer felt the need to make more profit and record high volume sales and create more demand for their goods and services, and recognized the activities of the competitors, all these combine to make it necessary to employ promotional tools techniques to inform, to educate and persuade potential customer to purchase their products. This is all with an attempt to create demand and improve sales performance, which is the primary effect of sales promotional tools. 

Based on the above, the study intends to examine the relationship between promotional tools employed and organizational performance. 

1.2       STATEMENT OF THE PROBLEM 

 There are so many problems associated with promotional tools which make it worth studying. They include poor planning of the promotional campaign, lack of good presentation, inadequate conductivity and the use of untrained personnel that makes it impossible to achieve the desire goals. Promotion is an essential tool that increases awareness and stimulates interest in the product or brand, also it persuade people to sells their product.  

 Promotional tools play a paramount role in marketing but without its effective use, organization”s sales may decline and may affect organizational performance. Therefore, organisations should treat its promotional efforts as a complete subsystem within its marketing system. Promotional tools should be sensitively handled by the organisation or consultants so as to achieve the expected results. 

 Despite the importance of promotion increasing demand and making sales which in turn make organisation to achieve orgnaisational performance, so companies still handle it with carelessness due to lack of vision. The major role of promotion as a tool in marketing mix is persuasive communication, which main objectives are to inform, persuade or remind the target customer about the company”s marketing mix. To accomplish the above objectives, a marketer must employ a combination of the following elements i.e. advertising, personal selling, sales promotion, publicity and public relation. These elements above constitute the ingredient of promotional mix and getting these elements together is one of the tough challenges facing marketing managers today. 

 In the light of the above, this research work is undertaken to examine the factors influencing the use of promotional tools to achieve organizational performance. Furthermore, this is aimed at finding how promotional tools are executed to increase sales and profit levels, gain customers and achieve performance. 

1.3       OBJECTIVES OF THE STUDY 

 The aim and objectives of this study is to investigate the relationship between the use of promotional tools and organizational performance. The specific objectives are: 

1)         To examine the relationship between promotional tools and sales and profit level of the company. 

2)         To find out whether advertising and sales promotion as promotional tools has positive effect on organizational performance. 

1.4       RESEARCH HYPOTHESES

A hypothesis is a tentative answer to a research problem or question, provided by a researcher which is subject to acceptance or rejection at the end of the study. The following are the hypotheses of this study:

1.         There is a relationship between promotional tools and sales and profit level of the company. 

2.         Advertising and sales promotion as promotional tools has a positive effect on organizational performance. 

1.5       SIGNIFICANCE OF THE STUDY 

 Promotional tools are being employed in most business organisation to influence and persuade their customers to act favourably towards their products. Most organization spend huge amount of money on marketing communications to influence the purchase decision of their customers. 

 This study will help organisations to understand the importance of promotional tools so as to achieve organizational performance. This study is of great importance to government, managers of business organisations and both students of higher learning and researchers. 

This research work is significant to the government because it will assist government to design policies favouring organisation to achieve sales and profit level which will in turn increase turnover and inflow of more money accrued to Government as revenue. 

 To managers of the organisations, it will enable business organizations to design, implement and improve on their promotional tools to achieve performance. 

            Finally, to students of higher learning and researchers, the research findings will serve as a source of literature. 

            The research shall in no small measure contribute to the knowledge as it shall be a useful text for the scholars.