THE IMPACT OF ADVERTISING ON SALES LEVEL:

A CASE STUDY OF MTN – MASAKA REGION

KATO JOSEPH SSERUWU

0772017741

kato.jozef@icloud.com

UGANDA MARTYRS UNIVERSITY

JUNE, 2014
 THE IMPACT OF ADVERTISING ON SALES LEVEL:

A CASE STUDY OF MTN MASAKA REGION

KATO JOSEPH SSERUWU

0772017741

kato.jozef@icloud.com

A DISSERTATION SUBMITTED TO THE FACULTY OF BUSINESS

ADMINISTRATION AND MANAGEMENT IN PARTIAL FULFILMENT

OF THE REQUIREMENTS FOR THE AWARD OF A BACHELOR’S

DEGREE IN BUSINESS ADMINISTRATION AND MANAGEMENT

OF UGANDA MARTYRS UNIVERSITY

JUNE, 2014

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 DECLARATION

I hereby declare that this research work is my original work and it has never been submitted in

this form or any other form to this or any other institution for examination purposes. Any

quotation made has been referenced accordingly.

Signature ………………………………………… Date………. /…........./……….

KATO JOSEPH SSERUWU

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 APPROVAL

This research proposal has been submitted for examination with my approval as the candidate’s

supervisor

Signature ……………………………………… Date………/…..…../……….

DR. GENZA MUSOKE GYAVIIRA

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 DEDICATION

This work is lovingly dedicated to my special son Kieran Lloyd Sseruwu, for the continued

support and motivation.

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 ACKNOWLEDGEMENT

The successful completion of this study was made possible by the support and contribution of a

number of people to whom I am deeply indebted. I am exceedingly grateful to my supervisor Dr

Genza Musoke Gyaviira, my mentor and technical advisor in completion of this study; your

skills are and will always be valuable to me.

My sincere thanks go to MTN group – Masaka region office staff and the entrepreneurs and

customers who participated and allowed me to do my research. Your unselfishness and

dedication to work is highly appreciated.

I owe special thanks to my long time friend Nabukenya Angella whose inculcation of knowledge

to me has changed my view of the universe.

My special appreciation goes to Rev. Fr. Charles Ssekyewa, Eng. Bbaale Mugera, my mother

Nalongo Gertrude Nakazinga, my late father Ssalongo Davis Ssegirinya, my sisters Prossy,

Sarah, Josephine and Stellah. Your physical and moral support has helped me acquire my

precious degree at Uganda Martyrs University.

Finally my appreciations go to all my friends Nabukenya Angella, Nakimbugwe Julian,

Ssenabulya Paul, Denis Ssebadduka, Nakiyemba Bernadette, Ssemakula David William,

Ssenkumba Maurice, Bukenya Vianney, Mulindwa Bob, Namwebe Sharon, Kimbugwe Anthony,

and all staff of BM Constructions Ltd, Nina Hardware Ltd and Segken Services Ltd.

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 TABLE OF CONTENT

Table of Contents

DECLARATION ........................................................................................................................... iii

APPROVAL .................................................................................................................................. iv

DEDICATION ................................................................................................................................ v

ACKNOWLEDGEMENT ............................................................................................................. vi

TABLE OF CONTENT ................................................................................................................ vii

ABBREVIATIONS ....................................................................................................................... xi

LIST OF TABLES ........................................................................................................................ xii

LIST OF FIGURES ..................................................................................................................... xiii

ABSTRACT................................................................................................................................. xiv

CHAPTER ONE ............................................................................................................................. 1

INTRODUCTION....................................................................................................................... 1

1.1 Introduction to the study .................................................................................................. 1

1.2 Background to the study .................................................................................................... 1

1.3 Problem statement ........................................................................................................... 12

1.4 General objective ............................................................................................................. 12

1.5 Specific objectives ........................................................................................................... 13

1.6 Research questions .......................................................................................................... 13

1.7 Scope of the study............................................................................................................ 13

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 1.8 Significance of the study ................................................................................................. 14

1.9 Justification...................................................................................................................... 14

1.10 Conceptual framework .................................................................................................. 15

1.11 Limitations of the study ................................................................................................. 16

1.12 Conclusion ..................................................................................................................... 16

CHAPTER TWO .......................................................................................................................... 17

LITERATURE REVIEW.......................................................................................................... 17

2.0 Introduction ..................................................................................................................... 17

2.1 Actual review ................................................................................................................... 17

2.4 Conclusion ....................................................................................................................... 27

CHAPTER THREE ...................................................................................................................... 28

METHODOLOGY .................................................................................................................... 28

3.1 Introduction ..................................................................................................................... 28

3.2 Research design ............................................................................................................... 28

3.3 Study population .............................................................................................................. 28

3.4 Area of study ................................................................................................................... 29

3.5 Sample size and selection ................................................................................................ 29

3.6 Sampling techniques ........................................................................................................ 30

3.7 Methods and instruments of data collection .................................................................... 31

3.8 Data management and analysis........................................................................................ 32

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 3.9 Reliability and validity .................................................................................................... 33

3.10 Ethical considerations .................................................................................................... 34

3.11 Conclusion ..................................................................................................................... 34

CHAPTER FOUR......................................................................................................................... 35

DATA PRESENTATION, ANALYSIS AND INTERPRETATION....................................... 35

4.0 Introduction ..................................................................................................................... 35

4.1 Demographic characteristics of respondents ................................................................... 36

4.2 General findings of advertising and sales level ............................................................... 38

4.3. Findings by objectives .................................................................................................... 45

CHAPTER FIVE .......................................................................................................................... 57

SUMMARY OF FINDINGS, CONCLUSIONS, AND RECOMENDATIONS...................... 57

5.0 Introduction ..................................................................................................................... 57

5.1 Summary of major findings ............................................................................................. 57

5.2 Conclusions ..................................................................................................................... 58

5.3 Recommendations ........................................................................................................... 58

REFERENCES .......................................................................................................................... 60

APPENDIX II .............................................................................................................................. i

Employee/Staff Questionnaire .................................................................................................. i

APPENDIX III ........................................................................................................................... iv

EMPLOYEE/STAFF INTERVIEW GUIDE ............................................................................. iv

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APPENDIX IV ............................................................................................................................ v

Time frame work for conducting the research study ............................................................... v

APPENDIX V ............................................................................................................................ vi

Budget frame work ................................................................................................................. vi

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 ABBREVIATIONS

Ads Adverts

AMA American Marketing Associations

BC Before Christ

CIA Central Intelligence Agency

CVP Cost Volume Profit

CBS Central Broadcasting Services

EVD Electronic Voucher Distributor

HR Human Resources

MBs Megabytes

MMC Masaka Municipal Council

MTN Mobile Telephone Network

NRM National Resistance Movement

UBC Uganda Broadcasting Corporations

USA United States of America

UMU Uganda Martyrs University

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 LIST OF TABLES

Table 1: Target population and sample size………………………………………………..30

Table 2: Sampling techniques……………………………………………………………….31

Table 3: Demographic characteristics of MTN employee respondents ……………………36

Table 4: MTN advertising in relation to products..................................................................38

Table 5: General analysis of the relationship between advertising and sales level.................39

Table 6: Television as a means of advertising.........................................................................40

Table 7: Newspapers as a means of advertising......................................................................41

Table 8: Radio as a means of advertising................................................................................41

Table 9: MTN adverts reach the intended audience................................................................43

Table 10: MTN uses Newspaper advertising...........................................................................45

Table 11: Newspaper advertising and sales level using Pearson’s Correlation……………....51

Table 12: Advertising and increase in sales level.....................................................................52

Table 13: Radio advertising used by MTN...............................................................................53

Table 14: Radio advertising and sales using Pearson’s correlation...........................................55

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 LIST OF FIGURES

Fig. 1 Concave and S – Shaped curves of adverting in relation to sales…………………6

Fig. 2 Conceptual linkage between advertising and level of sales………………………15

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 ABSTRACT

The study aimed at assessing the impact of advertising on the sales, a case study of MTN Masaka
region office. The study was mainly looking at advertising and sales of MTN group and whether
there was a relationship between the two.

The researcher used a descriptive case study research design with both qualitative and
quantitative methods with a study population of 100 respondents and a sample size of
respondents. Simple random sampling was used to select the employees and the outlets and
employees departments which included Finance, Marketing, Human Resources, and Procurement
departments. Using simple random sampling respondents were chosen from the different
departments selected and questionnaires distributed to the selected respondents from the four
departments. This method had the least bias and offers the most reliable findings. Also purposive
sampling was used because of it is less time consuming. Both the primary and secondary data
was used during collection of data. Data was collected by use of questionnaires and use of
interview guide and analyzed in form of tables.

Findings revealed that MTN advertises most of its products and it uses different forms of
advertising and media, and there was a close relationship between advertising and sales level
with a positive correlation of 0.908. The researcher found out that radios and newspapers are
widely used by MTN in their advertising campaigns. This is illustrated from the Pearson’s
correlation where the research got a positive correlation of both media which means there is a
strong relationship between the variables; radio and newspaper advertising with sales level.

Radios and newspaper were found to be convenient advertising media used by majority of people
in Masaka region because they deliver adverts in form of drama, comedy and persuasion which
capture the minds and hearts of customers and hence influence them to buy from MTN products.

The study recommended MTN to continue using newspapers and radio in their advertising
campaigns because they capture a wide market base. They should also choose the most effective
media for advertising and one that is affordable by many people for example radios. MTN should
focus more on these local radio stations as most respondents knew more of their programs than
radios from other regions. It should also use different common local languages when using
newspaper advertising used in the country

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 CHAPTER ONE

INTRODUCTION

1.1 Introduction to the study

This chapter covers core concepts and context of advertising and the sales level of a product of

small scale businesses. It is specifically looks at the background to the study, statement of the

problem, study purpose, specific objectives, research questions, the scope and justification of the

study, conceptual frame work and limitations of the study.

1.2 Background to the study

The word “advertising” comes from a Latin word, “ad vertere” meaning "to turn toward”.

Therefore, “to advertise” means to bring a product or service to the attention of potential and

current customer. Advertising is an important tool of sales promotion consisting of all the

activities involved in presenting a non-personal, oral or visual, sponsored message regarding a

product, service or idea. This message called an advertisement is disseminated through one or

more media and paid for by an identified sponsor (Kotler, 1998).

Advertising is a non-personal communication of information usually paid for and persuasive in

nature about products, services or new ideas by identified sponsors through various media (Arens

2008). Advertising is a form of communication that typically attempts to persuade potential

customers to produce or to consume more of a particular brand of product or service (Kotler,

2010). Many advertisements are designed to generate increased consumption of those product

and service through the creation and reinforcement of brand image and brand loyalty.

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Therefore in this study, advertising means a non – personal presentation and promotion of ideas,

goods, or services by an identified company or any other legal business.

There are various forms of advertising like reminder advertising, informative advertising,

persuasive advertising, complementary advertising, and reminder advertising. Reminder

advertising is one used to keep consumers thinking about the product or service .it is important

for mature products or services (Arens, 2008). It reminds customers that the products May be

needed in their near future, where to buy the product and maintaining top of mind product

awareness.

Informative advertising informs the consumers about products and their characteristics and, thus,

improves the decision situation of the consumers by making them aware of facts that they

otherwise might overlook. Consequently, informative advertising rest on the assumption of

imperfect information on the side of the consumers and tends to heal related inefficiencies by

helping consumers to obtain direct and/or indirect information on the products in question. It

tends to enhance competition because of the higher market transparency that it generates (Arens,

2008).

Persuasive advertising, on the other hand, is viewed to influence and alter consumers’

preferences thus, creating ‘artificial’ product differentiation (Kotler 2010) and brand loyalty.

This type of advertising is often assessed to create negative competition and welfare effects since

those ads distort tastes and create wants (Arens, 2008), thereby misleading consumers to buy

products they actually do not want

Complementary advertising views the product and its advertising as complements. According to

Kotler and Armstrong (2010), it conjectures that consumers may have preferences like social

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prestige that can be obtained from purchasing a product only in connection with an advertising

campaign rendering the product prestigious for the respective social peer group of the

consumers. Although this type of advertising does not primarily contain information in the sense

of ‘matter-of-fact’-information, it also does not influence or change consumer’s tastes and

preferences. Instead, the – usually rather emotional and image-focused – advertising changes the

advertised product by attaching a prestige- or coolness-factor to it and, thus, only makes the

product compatible with the consumers’ preferences.

However, in practice, many advertising media mix these four elements (Kotler, 2010) and their

distinction is particularly valuable from an analytical perspective. For research purposes, we can

reduce the three elements and distinguish between two essential ways in which companies can

advertise their products – either through informative or persuasive/ complementary advertising.

Persuasive and complementary advertising can be treated together in our framework because

both oftentimes use special elements that create a certain atmosphere through images and

statuses, which the consumer shall identify with. The advertising content is usually difficult to

verify since no or hardly any information about the product characteristics itself are given

(Kotler and Armstrong, 2010). An example would be a television advertisement for a perfume

where, for instance, the product is shown and introduced by a celebrity but without giving any

further product or price information about the perfume.

Both persuasive and complementary advertising is oftentimes used to create and maintain a

branded product. Informative advertising, on the other hand, is – as the term already implies –

informing the customer about hard, verifiable facts. This could be the price, certain product

characteristics or both. A good example would be a print advertisement from a grocery store that

advertises a certain promotional offer (e.g. price reductions for certain products).

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Advertising can be done through print media which include news papers, magazines, brochures,

Audio media for example Radio, and visual media which includes billboards, and television

Kotler and Armstrong (2010). Advertising plays a significant role today in the whole

world. According to Kotler (2005), more than $500 billion a year is spent on advertising

worldwide. Development of retail stores have made traders to be more concerned

about attracting business thus informing customers of the availability of supplies through

advertising is highly important. This study links advertising with sales level.

The term “sales level” is referred to as the amount of money collected for goods and services

provided. While payment is not necessary for recognition of sales on company’s financial

statements, there are strict accounting guidelines stating when sales can be recognised. The basic

accounting principle of accrual is that a sale can only be recognised when the transaction is

already realised, or when it can be quite easily realised. This means that a company should have

already received a payment, or the chance of receiving a payment is high.

Sales level is the core interest of every organization and is based on sales and profit. According

to McCathy (1994), sales level Sales level refers to consistent and satisfactory turnover of goods

and services produced and put on the market by an organization or company. It is the sole

economic goal of companies to have as much goods sold on the market (Kotler, 2010). This

facilitates the rate of goods turn over and consequently revenue and increased production.

Sales level describes the trend of collections in terms of revenue when comparing different

periods (McCarthy, 1994). The sales may be in form of offering products or services to

consumers. A service is any activity or benefit that one party can offer to another that is

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essentially intangible and does not result in ownership of anything tangible (Kotler & Armstrong,

2010).

Sales in business terms are the actual sold out items in money values, a company receives after

necessary collections are made from different sales channels of the original total production put

on the market (McCathy, 1994). It is sales that stimulate production in a company and

consequently profits which are affected by various factors some of which are controllable like

quality and others are uncontrollable like competition and general price changes.

Sales level is an integrated frame work that enables organizations to plan and model sales

strategies and ensure timely execution of sales initiatives while ensuring both front line sales

people and decisions-markers have visibility into performance . Sales performance represents the

next generation of best practices for sales. (Michael D, 2006).

This study links advertising to sales level in the sense that advertising is used to increase sales

revenue hence improving sales performance (David et al., 1988). Advertising combines with a

host of other influences to determine what contribution they make to the buyer’s purchase

decision.

A study by Leong et al., (1996) using co-integration technique found a strong positive

relationship between advertising expenditure and sales. Similarly, Lee et al., (1996) found that

the variables of advertising and sales are not only integrated of same order but also co-integrated.

The results explicated that causal relationship between advertising expenses and sales works in

both directions. Leach and Reekie (1996) analyzed the effect of advertising on the market share

of a brand using variants of the Koyack Distributed Lag model. Further, the results of the

Granger causality test showed that advertising expenses caused sales but sales do not

5
simultaneously cause advertising. Elliot (2001) revealed that advertising has a significant

positive effect on food industry sales and this relationship between advertising expenditure and

sales appears to be stable. Pagan et al (2001) studied the effectiveness of advertising on sales

using bi-variate Vector Auto Regression model and showed that one time increase in advertising

expenditure leads to increase in the sales with a one month lag.

While analyzing the relationship between a company’s advertising expenditure and its sales

during the recession, Kamber (2002) found a measurable relationship between advertising

expenditure and sales, even after controlling other factors, such as, company size and past sales

growth, etc. Guo (2003) examined the relationship between advertising and consumption at

macro level on advertising expenditure, personal consumption and disposable income which

reveals the presence of long-term equilibrium relationship among them. Sundarsan (2007)

evaluated the effectiveness of advertising on sales of small and large firms, and for multinational

corporations. The results showed that advertising has influenced sales, though its relative

effectiveness was not the same for all the categories of firms.

Most of the studies of advertising and sales have specified on either concave or S-curve models

(Lilien, Kotler, & Moorthy, 1992).

Fig. 1 Concave and S – Shaped curves of adverting in relation to sales

S – Shaped curve Concave shaped curve

Source; Simon and Arndt (1980)

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The first set of opinions is depicted in the S-shaped response curve, which projects an S-shaped

response function to the budget outlay. Initial advertising budget have little impact on the sales

as is shown in the flat shape of zone A. After a certain amount of expenditure has been made i.e.

the firm is in range B, advertising and promotional efforts begin to have an effect, as additional

increments of expenditures result in increased sales. But this increase in sales continues only to a

point and after that in range С additional expenditures results in almost no or very little sales

(Simon & Arndt, 1980).

Using the concave – shaped curve, Simon and Arndt (1980) reviewed more than 100 studies of

the effects of advertising on sales and concluded that the effects of advertising budgets follow

the microeconomic law of diminishing returns. In other words increase in advertisement

expenditure lead to decrease in its value. Repetition of the advertisements and increase in

advertisement expenditure do not stimulate purchase among those people who do not want to

buy. With every repetition of the advertisement there is no additional information supplied to the

already potential buyers, which may persuade them to go ahead and make the purchase.

According to the concave-downward function model, the effects of advertising begin to diminish

and hence low advertising expenditure may be needed to create the optimal influence on sales.

Theoretically, this study will be modelled on the theory of hierarchy of effects model developed

by St. Elmo Lewis in 1898 (Lavidge & Steiner, 1961). The theory states that advertisers set

guidelines on to effectively target consumers with their advertisements so that a consumer may

purchase a brand or product. The theory holds that advertising influences the sales level of the

product. However the main issue is that consumers don’t make purchase decisions solely on their

reactions to an advertisement. The theory holds that there are many factors that lead to purchase

decisions which relevant advertisement cannot target. For example, consumers may have had bad

7
experiences with the product in the past and can be so loyal to a brand that any amount of

advertising will not change their awareness of other brand in the market place. Others may

include inflation, level of political stability, and other environment issues. However, in adopting

this theory, the researcher is not ignorant of its short comings that regardless of how advertising

campaigns are structured consumers are unpredictable. The feelings evoked in one consumer

may not be the same as the feelings of another when exposed to the same advertisement.

However, no amount of study of any model can help advertisers accurately predict how a

consumer will react and behave (Kotler, 2010).

The issue of advertising has a long history. According to Petit and Jeanne (2010), archaeologists

have found evidence of advertising dating back to the 3000s BC, among the Babylonians. One of

the first known methods of advertising was the outdoor display, usually an eye-catching sign

painted on the wall of the building. Archaeologists have uncovered many such signs, notably in

the ruins of ancient Rome and Pompeii. Petit and Jeanne, (2010) go on to state that an outdoor

advertisement excavated in Rome offering property for rent, and one found painted on a wall in

Pompeii calls the attention of travellers to a tavern situated in another town. In medieval times,

word-of-mouth praise of products gave rise to a simple but effective form of advertising, the use

of so called town criers. The criers were citizens who read public notes aloud and were also

employed by merchants to shout the praises of their wares. Later they became familiar figures on

the streets of colonial American settlements. The town criers were forerunners of the modern

announcer who delivers radio and television commercials.

Although graphic forms of advertising appeared early in history, printed advertising made little

headway until the invention of the movable-type printing press by the German printer Johannes

Gutenberg in the year 1450 (Petit & Jeanne, 2010). Egyptian used papyrus to make sales

8
messages and wall posters. Commercial Messages (CM) and political campaign displays have

found in the ruins of Pompeii and ancient Arabia. Lost and found advertising on papyrus was

common in ancient Greece and ancient Rome. The tradition of wall painting can be traced back

to Indian rock art paintings that date back to 4000 BC.

In Africa, wall or rock painting for commercial advertising is another manifestation of an ancient

advertising form which is present in different regions like the Nyero rock paints in eastern

Uganda, and Bigobyamugenyi in Ssembabule. In Uganda during the 19th century, according to

Bareebe (2011), the first advertising medium was established in 1955 called the Uganda Argus.

However, following the rise to power of Idi Amin in 1971, the government paper was renamed

Voice of Uganda (VoU). It was by this time that lots of advertisements mainly on agriculture and

economic development were being published. These ads couldn’t capture wide coverage because

newspapers were meant for a few literates. Many people at a time couldn’t know how to read and

write. When Amin was deposed in 1979, the second Obote government named this paper Uganda

Times. When the National Resistance Movement (NRM) seized power in 1986, the name of the

government daily newspaper was changed to New Vision (Bareebe, 2011).

At independence in 1962, the Uganda Broadcasting service, later renamed Radio Uganda was

inaugurated and finally the Uganda Broadcasting Corporation (UBC) which was seen as a vital

tool in furthering national consolidation and development. This marked a trend in advertising

media through airing of ads on Matalisi. However, Uganda’s linguistic configuration rendered

this quite complicated as there were still a problem of language barrier (Bareebe, 2011). A

national public sphere with radio at the centre was therefore hard to imagine. Yet, consistent with

the modernisation thinking of the 1960s, radio was seen as a partner in development and was

expected to reflect government policy, as much as possible positively (Chibita, 2010).

9
Today, Uganda boasts of more than 200 radio stations, 50 television stations and more than 25

newspapers and tabloids (Mugabe, 2011). However, many firms use advertising to cover the

wrong actions of their businesses by advertising for many services and products which they have

never produced or manufactured (Mugabe, 2011). Instead, they intend to induce consumers to

buy more of their goods and services in order to win the marketing culture. According to

Mugabe (2011), firms that intentionally provide false adverts are those that do not appreciate the

ethics of advertising.

Advertising in Uganda has not been considered optimum by most business owners and

consumers because the copyright law governing advertising is in existence but not effective

anywhere (Bareebe, 2011). Thus businesses and other organisations have emerged with false ads

to manipulate and exploit consumers (Bareebe, 2011). Most of the business owners have not

appreciated the role of advertising in the success of their businesses and to the market stand on

the sales level of their products. Other have tried to advertise but have failed to increase the sales

level due to use of inappropriate advertising media, poor advertising research, selected target

population, and many more. So there is a need by business owners to come up with good

decisions when choosing suitable advertising media and to know when to position their ads for

more sales.

The organisation of specific interest to this study is Mobile Telephone Network (MTN) legally

presented as MTN Group which was launched in 1994 as a multinational telecommunications

group, with its core operations in 21 countries in Africa and the Middle East. On October 21

1998, with its headquarters at 22 Hannington Road, Kampala MTN Uganda launched

commercial services in Uganda, just six months after acquiring and signing of the license. MTN

has since grown to be the leading Telecommunications Company in Uganda servicing in excess

10
of 7,700,000 customers. According to Angumya (2013) MTN subscriber numbers are at 7.7

million, giving it a 52.5 percent market share. Despite insufficient infrastructure (power, roads...)

MTN has covered in excess of 90 percent of the urban population, providing services in over 150

towns and villages and their immediate environments.

MTN Uganda has the biggest customer services centre in Uganda offering the largest language

preference base and extended hours of operation. Through use of different advertising media

appropriate to their setting, MTN has managed to out compete other telecommunication groups

(Kawere, 2013). MTN has established customer services points at Shoprite Ben Kiwanuka

Street, Lugogo Mall, General Post Office, Crested Towers, Kikuubo branch, Jinja, Masaka and

in Mbarara. MTN offers Customer Care in over 19 local and international languages when

customers call the 123 help line for prepaid customers or 121 for Post paid queries and 122 for

mobile money inquiries (Angumya, 2013).

In Masaka, MTN started in 2007 as a retail shop which used to issue out airtime cards, and

selling mobile phones. It was later transformed into a regional service centre covering the

districts of Kalangala, Lwengo, Ssembabule, Rakai, Bukomansimbi, Kalungu, Lyantonde and

other parts of south – western Uganda. It is through strong selling and distribution policies that

have led to increase sales in MTN group in Masaka and different parts of Uganda at large

(Angumya, 2013). However, its advertisements lack the unique selling proposition in the

statements used to differentiate their products from competitors, they are done in the same way

as the competitors making it hard to differentiate its ads from others (Angumya, 2013). Besides,

their advertisements have failed to provide room for further information about their products for

clarification (Kawere, 2013).

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1.3 Problem statement

Kotler (2010) notes that more than $500 billion a year is spent on advertising worldwide and the

largest group of advertisers is food marketers. Although many businesses have invested in

advertising and benefited from using different media like Radios, Banners, billboards, TVs, and

Newspapers, some business owners do not appreciate the role of advertising until they collapse

due to competition from other firms.

Mugabe (2011:12-13) even states that, “60 percent of the newly started businesses collapse every

year due to lack of advertising and poor advertising media”. Therefore, many firms have used

inappropriate media hence failing to meet the preferences and tastes of the targeted customers.

MTN has failed to penetrate markets in different parts of Uganda especially the remote areas and

this could be due to use of inappropriate advertising media. Might the fact that most of the

newspaper and radio adverts are delivered in English lead to poor interpretation by local

consumers hence low sales and dormancy of the products and services? Unless answers to this

question are discovered, MTN group may fail to achieve their targeted objectives. Also MTN

might fail to know the contribution of advertising on sales level, hence the need for the study on

impact of advertising on sales level.

1.4 General objective

To examine the impact of advertising on the sales level of MTN-Masaka region in Masaka

region

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1.5 Specific objectives

1. To find out how newspapers advertising influences the level of sales in MTN – Masaka

region

2. To find out how radio advertising impacts the level of sales in MTN – Masaka region

1.6 Research questions

• What is the contribution of newspapers advertising on the level of sales in MTN –Masaka

regional office?

• What is the contribution of radio advertising on the level of sales in MTN –Masaka

regional office?

1.7 Scope of the study

1.7.1 Content scope

This study assesses the impact of advertising on the sales level in MTN Group – Masaka Area.

The study specifically sought to determine the contribution of advertising in increasing or

decreasing sales level in MTN – Masaka area.

1.7.2 Geographical scope

This research study was carried out using a case study of MTN – Masaka area in Katwe - Butego

division which is one of the four divisions of Masaka Municipal Council (MMC), Masaka

District in Uganda.

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1.7.3 Time scope

The study was carried out from 2013 to 2014 and analyzed impact of advertising on sales level.

The time frame was moderate and it gave the researcher time to gather required information.

1.8 Significance of the study

• The study might enable MTN group to have a clear comparison between advertising and

sales level hence basing on it to have proper decision making.

• Also other academicians may use this research to build on their research proposal as well

as their dissertations and thesis.

• As for the researcher, the study is likely to widen his scope of understanding issues of

advertising and it impacts level of sales.

• Many business people may achieve their targeted goals after identifying the relationship

between advertising and sales to use appropriate advertising media.

1.9 Justification

• Research in different fields has been carried out but the research on the relationship

between advertising and sales level has been ignored.

• To the best of researcher’s knowledge, this kind of research has not been carried out and

if carried out it was not to the expectation because many firms are still collapsing due to

absence of advertising.

• This study is of great importance to the researcher as one of the requirements for the

award of a bachelor of Business Administration and Management degree of Uganda

Marty’s University.

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1.10 Conceptual framework

Fig. 1. Conceptual linkage between advertising and level of sales

Independent variable (IV) Dependent variable (DV)

MTN SALES LEVEL

ADVERTADVERTISING

§ Newspaper advertising § High volume sales

§ Radio advertising § Moderate volume sales

§ Low volume sales

Extraneous variables (EV)

§ Accessibility
§ Inflation
§ Political
§ Income levels

Source; Designed by the researcher using ideas suggested by Kotler (2010)

Fig 1 indicates that advertising influence sales volume of the product. This frame work identifies

the relationship between the different advertising media and the level of sales volume in MTN

Masaka regional office. Among the different media, the researcher looked at newspaper and

radio advertising. The sales volume included high, moderate and low sales volume. Other

factors considered include extraneous variables like accessibility, inflation, level of income, and

political factors.

15
1.11 Limitations of the study

Ideally, this research would be carried out using longitudinal design and covering the whole of

Uganda. However, the limited time and inadequate funds allocated to the researcher dictated a

cross sectional design. Therefore, a need remains for other researchers to use longitudinal design

to supplement the results of this study.

1.12 Conclusion

This chapter has examined the problem why the study has to be carried out, the objectives,

justifications and significances to the study. The next chapter will focus on the literature review

i.e. what other academicians say about the relationship between advertising and sales level.

16
 CHAPTER TWO

LITERATURE REVIEW

2.0 Introduction

This chapter discusses the literature related to the impact of advertising on the sales level of a

product. It particularly focuses on the extent to which an advertising programme affects the sales

volume of a product, and the different advertising media that can increase the sales volume of a

product in an enterprise. These are considered the pillars of the research study.

2.1 Actual review

2.1.1 Newspaper advertising and sales level

Newspaper advertising is a form of newspaper advertisement - where the advertisement appears

alongside regular editorial content (Kotler, 2010). Display ads are generally used by businesses

and corporations towards promotion of their goods and services and are generally for larger

budget clients. A recent research has stated that newspaper display ads are different than the

regular "display ads" terminology, which is commonly referred to as advertisements placed on

the internet in banner and other rich media format (Kotler and Armstrong, 2010). These ads can

span across multiple columns - and can even cover full page, half page, quarter page or other

custom sizes. They are designed in high resolution coloured and black/white formats providing

higher visibility for the mass audiences of newspapers (Freedman, 2006).

Newspaper advertising contains (Ingram, 2006) display ads and (McHugh, 2000) classified ads.

Display ads typically contain text, photographs, logos, maps, and other informational items. In a

17
newspaper, display advertising appears on the same page as, or on the page adjacent to general

editorial content. Whereas, classified ads generally appears in distinct sections - based on their ad

category in a designated newspaper classified pullout. According to Ratimosho (2003), classified

ads can either be normal classified texts or classified display ads. Classified display Ads are

cheaper than regular display ads - and appear in smaller width sizes in the classified columns

Ingram (2006) suggests that newspaper advertising has been around longer than any other form

of advertising we see today and is still the first kind of advertising that businesses think about

doing. These ads can do a lot more than just advertise one item or one sale--each one can work

really hard to bring in customers, and then bring them back again and again thereby increasing

sales at a certain level (Mugabe, 2011). However this research has been suspended by (McHugh,

2000; Ratimosho, 2003) that it doesn’t clearly defines the level at which sales is increased.

They're a good way to reach a large number of people, especially those who tend to read the

paper more frequently than younger demographic groups who tend to get their news from

television, radio or the internet McHugh (2000). MTN uses different types of newspapers

targeting different population. For example New Vision and Monitor are used for the literates

and Local news papers like Bukedde, Rupiny, Etop, and others to target locals. Also tabloids like

Kamunye, Kampala Sun, Onion, Redpepper, Newspapers remind consumers about the available

promotions and change of rates.

Kotler (2010) says that newspaper was great twenty years ago when people had the time to sit

and read it every day, but unfortunately, it does not play as well in today’s mobile and fast paced

world. In support of Kotler (2010), in his research to find out the effectiveness of newspapers,

Jobbers (2010) states that some people don’t find it convenient to walk along with hard copies of

newspaper.

18
On the topic of cheap advertising techniques Jobbers (2010, p.342) states:

The cost of placing a typical ad in the classified section of the newspaper is minimal.
Your ad will be categorized according to its content for easy reference. In a large metro
area, this can be a disadvantage as well. Your ad may get lost in the shuffle unless you
make it stand out. The use of color and bold print considerably increase the effectiveness
of the ad unfortunately, the cost of placing a large full page color ad can be quite
expensive.
Ingram, (2006) as cited in Kotler (2010), points it out that newspaper pages often mix ads with

editorial content, although some pages are devoted solely to advertising. A reader can easily

focus on a full-page ad since no other ads compete for his attention. In contrast, a page's multiple

ads create visual clutter and competing messages. Advertisers, especially businesses with small

or unimaginative ads, risk having their ad completely passed over while the reader engages with

larger or more interesting graphics. Therefore, resources in terms of money become wasted and

the targeted consumers are not reached out due to some other compelling stories and gossips that

diverts consumers mind.

In support of Busari, et al. (2002), about clutter in newspaper ads, Jobbers (2010) emphasises

that newspaper ads appear on large, busy pages of type and can easily be overlooked by readers.

Newspapers sell retail ads that appear throughout the paper interspersed with news reports and

photos. Retail ads are typically stacked in a cluster at the bottom of each page where they

compete with one another, and with the news content, for the reader’s attention. Businesses can

also buy classified ads that run in the classified section, which is devoted exclusively to a mix of

different styles of advertising. Noted by Freedman (2006), the classified section draws readers

who are looking for products or services, unless ads are large and bold they can be lost in a sea

of small grey type.

19
To some authors, the relationship between newspaper advertisement and sales has been a much

debated topic and studied widely at different points of time. Busari et al (2002) while studying

the relationship between advertising and aggregate demand found that newspaper advertising

have a positive relation with aggregate demand. However, Ekelund and Gramm (2003) analyzed

the relationship between newspaper advertising expenditure and aggregate consumption but

could not establish any positive relationship between these two. Similarly, Taylor and Weiserbs

(2002) studied the relationship between newspaper advertising expenditure and aggregate

consumption on the basis of Houtakker-Taylor model and showed that newspaper advertising

affects aggregate consumption and the relationship is not found to be unidirectional but

simultaneous.

Most of the studies have used time series data to capture the long-term effects of newspaper

advertising on sales. However, it is important to know effects of newspaper advertising expenses

on sales revenue for corporate sector. Moreover, the area that to what extent newspaper

advertising’s persuasive character work to alter consumers wants and consequently sales have

received scant attention.

Other researchers have tested a variety of theories about the shape of sales in response to

newspaper advertising. There seems to have emerged a consensus that, as newspaper advertising

reaches high levels, its effectiveness declines, i.e., it results in diminishing returns (Aaker &

Carman, 1982; Simon & Arndt, 1980). And, in fact, many researchers postulate that very high

levels of newspaper advertising result in saturation where there is no effect, or even a negative

effect, on sales. At lower levels some empirical evidence suggests a newspaper advertising

threshold below which advertising has no effect on sales level (Eastlack & Rao, 1986; Rao &

Miller, 1975).

20
On the other hand, the role of newspaper advertising in creating brand loyalty, deterring entry

and consequently increasing sales revenue and profits of the organization and causing impact on

the business cycle has been emphasized at various points of time by different studies (Nelson,

1974; Sundarsan, 2007). Accordingly, in evaluating newspaper advertising effectiveness,

researchers have examined not only sales data but also data on other mental (e.g., awareness,

memory and attitude) and behavioural responses (e.g., search for product information, requesting

price quotes). For example, Hanssens, Parsons, and Schultz (2001) note that practitioners have

attempted to incorporate intermediate response measures in sales response models. More

recently, Srinivasan, Vanhuele, and Pauwels (2010) construct a market response model that

explicitly links survey-based measures of consumer mindset with sales. Similarly, combining

consumer survey data with actual purchase data Bruce, Peters, and Naik (2012) test a theoretical

framework on how newspaper advertising works, attempting to uncover the pathways for

experience, cognition and affect that influence purchase. Both studies lead to new insights

regarding how newspaper advertising affects how consumers “think” and “feel,” which in turns

affects what they buy (i.e., the dynamics between upper purchase funnel activities and sales).

McAlister, Srinivasan and Kim (2007) note that newspaper advertising communicates and

informs consumers which “enhance brand loyalty” and this indirectly translates into sales.

Research by (Chauvin & Hirshey 1993; Desai 2000; Joshi & Hanssens 2009), cited by Tuli et al.,

(2012) indicates that when companies spend more money on newspaper advertising, investors

see this as a strategy to increase the consumer base leading to more sales. Eng and Keh (2007)

analyze the joint effect of newspaper advertising on brand value of the firm’s future operating

and market performance. They find that impact of newspaper advertising on future stock

performance is minimal, but spending on advertising results in better brand sales.

21
Other empirical evidence on the relationship between newspaper advertising and sales is mixed.

The pioneering study by Comanor and Wilson (1967) found a positive and statistically

significant relationship between newspaper advertising and sales level, as did an early study by

Shephard (1972). These results were challenged by Bloch (1974), Ayanian (1975) and Demsetz

(1979) because they treated newspaper advertising as an expense rather than an investment,

overstating the true rates of return to advertising. More recently, Martin (2007), Ravenscraft

(2008), Salinger (2009), Kotler (2010) and Bothwell et al., (2011) has found positive and

statistically significant relationships between newspaper advertising and sales. However,

Friedman (2006), McHugh (2000), and Jobbers (2010) failed to find a statistically significant

effect. As is well known, however, the causal relation between advertising and sales is uncertain,

and some of the early studies regressing profit rates on advertising fail to account for the possible

endogeneity of newspaper advertising.

2.1.2 Radio advertising and sales level

It is difficult to think of businesses that cannot benefit from the kind of radio advertising that it is

involved in. According to Kotler (2003) when a business is to reach a national audience, radio

advertising delivers a much more budget friendly solution than other form of advertising.

Television and Print ads can cost hundreds of thousands of shillings to get off the ground.

Between getting copywriters, art directors, screen actors, models, video equipment, and studio

time, just producing a TV or Print advertisement is extremely expensive. Ingram (2006) further

adds that when you add in a media buy on national TV or circulation in a major national

publication, the cost skyrockets even more. There is still the need for creative, but instead of

shelling out thousands for expensive studio time, Union actors, video equipment, and editing,

you can have a high quality, response driving radio spot produced for a fraction of the cost.

22
Radio spots simply require fewer resources for production (Rotimosho, 2003). When thinking of

media spend, national radio rates can be much more attractive than TV rates - yet you're still able

to reach the intended target audience. Radio advertising is different from other forms of

advertising because it is accountable for results, and the only way it can be accountable is to

leverage a set of technological and human systems and processes to accurately capture, analyze

and interpret results of the advertising. Therefore, Neuman (2003) provides it that if a firm has a

profitable business model and a good product that delivers on a unique and relevant promise; it

can profitably acquire new customers through radio advertising.

However, some businesses have not enjoyed the positive impact of radio advertising because

they have failed to get the right level of commitment and focus. According to Angumya, (2013)

many business owners think they need to do a little of everything instead of doing one thing well.

A recent research by Kotler (2010) almost any business can get all the customers they need by

simply attacking and dominating the right radio station. Authors have for so long assessed the

impact of radio advertising on sales in reference to the language of the message (Barthes, 1964;

Durand, 1964). However, they analyze the quality of message from the viewpoint of its

construction, its presentation and the place of the communication process to the intended

consumers.

The differential effects of advertising campaign of businesses on expected sales of products

reveal that radio advertisements produce substantial arousal among consumers and enhance level

of sales. Thus firms replicate this advertising strategy during different leisure sales seasons

(Panagopoulos & Green, 2008). However, it is argued that a firm can’t sustain a competitive

market when it only advertises during leisure seasons and that lack of format variety causes low

listenership and consequently the competitive markets are underserved by commercial radio

23
stations (Halcoussis & Lowenberg, 2003). The creative strategies used in radio commercials are

different and advertising firms adjust their communication strategies in response to the specific

needs of different consumers.

Thus Halcoussis & Lowenberg (2003), using the Central Place theory advocates that products

with lower buying frequency influence positively the perception of consumer on the promotional

communication through the radio programs (Hubbard, 1978; Yadav, 1994). The perception of

radio advertising on increasing the sales level affects the way people consider listening to radio

programs including commercials, perform information analysis, and make applied decisions and

their influence to buy. Therefore, since many people have easier access to radio communication,

they develop higher perceived intimacy to the broadcasts and tend to get every ad sponsored at a

cheap price (Kuffert, 2009).

With regard to specific advertising options like developing appropriate communication-mix and

creating messages, the most widely used promotional elements were found to be radio

advertising (Kotler, 2010; Kuffert, 2009; Hubbard, 1978; Yadav, 1994). However, some studies

had indicated that radio advertisements are fewer stimulants for specific services than those of

visual media though both advertising media and the relative quality of the advertisements

presented in the various media that drive the effectiveness of the advertisements (Nysveen &

Breivik, 2005). Thus Nysveen & Breivik, (2005) point out that there is no mutual complement

between radio advertising and sales level in absence of visual art.

The effects of localism in radio broadcasting have attributed to the consumers view that usage of

radio is beyond just seeking the traffic information on streets and weather updates. The localized

commercials on radio keep consumers also aware about the market movements (Sauls and Greer,

24
2007). The positioning of advertisements on radio is precise and well targeted to consumer

segments which drive higher response among listeners hence an increase in sales (Verhoef et al.,

2000; Van Guijel et al, 2008).

Populist style of radio advertisements on sales is largely created with humor to add emotional

value (Ingram, 2006; Kotler, 2003). Listeners perceive humor and develop attitude towards

communication and the brand. The purchase intentions are higher for humorous advertisements

containing moderate incongruity than those conveying message directly (Pornpitakpan and Tan,

2000). However, Mai and Schoeller (2009) have a diverging idea when they state that humor has

only been left for the youth who have lots of time making funny jokes. Similarly Kim (2000)

advocates for direct conveying of messages on radios that acquiring a product significantly affect

a person's interpretation and emotional experience of a commercial. Such beliefs of listeners help

advertisement to stay atop of the mind and consumers unconsciously associate with it as a

personally relevant information and have an enduring impact on their emotions and their

purchase power.

This view is criticized by Kotler (2003; 2010) and it has no direct relationship between radio

advertising and sales level. According to Kotler (2003; 2010), all the models mentioned are

mainly focused on three elements of the communication process: the recipients (in terms of

audience, memory, and storage), the media used (in terms of impact, coverage, frequency, etc.)

and the feedback (in terms of attitudes, behaviors, opinions, etc...). They totally omit other

elements (source, code, context) assuming essentially that the communication process was

conducted in optimal conditions or at least without distortion. Moreover a fundamental element

for an effective communication process is the use of the same code by the source and recipient.

Otherwise, the recipient will not understand the message or give a different meaning and this will

25
lead to the phenomenon called "aberrant” decoding hence resulting to low sales (Kotler, 2003).

However, since as stated by (Kuffert, 2009) the message is what we understand, not what it was

intended to understand, it becomes important to examine not so much and not only what the

firms wanted to communicate, but what was actually communicated, and whether what is

communicated impact on the level of sales.

A research on radio’s impact on sales by Simon and Arndt (1980), the results demonstrated that

radio campaigns have the highest efficiency levels when compared with all classic advertising

channels. Accounting for the actual market structure, the analysis also integrated the effects of

communication activities of two key competitors, also pure plays of similar size and providing

nearly exchangeable services. Radio campaigns were found to strongly affect the success of all

players in the relevant category and, thereby, increase competitors' sales (Simon and Arndt,

1980) cited by (Sauls and Greer, 2007). However, this effect can be reduced when the company’s

campaign is not run at the same time as the competitors. Overall, classical advertising with a

clear focus on radio advertising clearly pays off and outperforms other media like newspapers

with regards to generating new registrations. However, this only holds true until the point where

the marginal utility, which follows an S-curve function, starts to diminish below what

newspapers advertising can bring in (Simon and Arndt, 1980).

Therefore, in brief some scholars have directly linked advertising and sales level. However most

of these scholars treated advertising as an expense rather than an investment thus they could not

clearly derive on the relationship between advertising and sales level.

26
2.4 Conclusion

In this chapter the researcher identified the relationships between newspaper and radio

advertising with the sales volume and the relationship between advertising and sales level. MTN

uses mostly personal selling means of advertising because it covers inaccessible regions and it’s

cheap. In the next chapter, the researcher will look the methodology of Advertising impact to

sales volume in relation to what other authors say.

27
 CHAPTER THREE

METHODOLOGY

3.1 Introduction

This Chapter presents and describes the approaches and techniques the researcher used to collect

data and investigate the research problem. They include research design, study population,

sample size and selection, sampling techniques and procedure, data collection methods, data

collection instruments, validity and reliability, procedure of data collection, data analysis and

measurement of variables, and ethical considerations.

3.2 Research design

This study was conducted through a descriptive case study research design because it provides a

systematic description that is as factual and as accurate as possible (Amin, 2005). In addition a

descriptive case study research design has in-depth coverage, is simple, less time consuming and

a least costly alternative because data was gathered from different people found in one place

(Sekaran, 2003). These approaches were used to interpret and analyse the collected data from

both the staff and clients from MTN. The study also applied quantitative and qualitative

approaches. This study integrated these two approaches since Neuman (2003) asserts that

researchers who use one style alone do not always communicate well with those using the other.

3.3 Study population

The population sample studied included employees and customers of MTN, more specifically;

general manager, outlets manager, field managers, sales personnel, customer attendants, and

customers of MTN Masaka. The study was carried out using five of the ten MTN outlets in

28
Katwe-Butego division. These outlets are within the researcher’s coverage and vicinity that he

accessed all the outlets without any barrier.

3.4 Area of study

This research study was carried out in MTN – Masaka area in Katwe-Butego division which is

one of the four divisions of Masaka Municipal Council. The researcher chose this organization

because it is one of the leading and successful corporate firms in Masaka region (Angumya,

2013). Also the researcher chose Katwe – Butego because it’s the division with the leading MTN

subscribers out of the four divisions that make up Masaka.

3.5 Sample size and selection

According to Webster (1985), a sample is “a finite part of a statistical population whose

properties are studied to gain information about the whole.” When dealing with people, it can be

defined as a set of respondents selected from a large population for the purpose of the survey.

The five selected outlets solely focused on 5/10 which is 50% of the business. According to Gay

(1981) as cited by Mugenda and Mugenda (1999), for descriptive studies, atleast ten percent of

the accessible population is representative enough. Accordingly, the sample size drawn from the

case study consists of round 40 employees and customers of MTN. Although the study targeted

40 respondents, only 32 managed to respond to this study.

29
Table 1: Target population and sample size

Category Sample size Details of response

Target Actual Details Frequency Percentage
General manager 1 1
Outlets manager 5 4 Response 32 80
Field managers 3 3
Sales personnel 10 7 Non responses 8 20
Customer attendants 3 3
Customers 18 14

Total 40 32 Total 40 100

Source; Field data

Table 1 indicates that the targeted respondents were 40 but the actual were 32. 1 outlet manger,

three sales personnel and four customers did not respond to the questionnaires. It also shows

details of respondents in which 80% responded and 20 % did not respond to the questionnaires.

This shows a good turn up of the respondents despite the fact that they were somehow scattered

in the field. This shows that majority of the people responded positively to the questionnaires.

Those who didn’t respond gave excuses of not having time for answering questions because most

of them were occupied by work.

3.6 Sampling techniques

In this study, simple random sampling was used to select the five outlets. Best and Khan (2003)

explain that this type of technique ensures that all the elements in the population have equal

chances of being selected. Sekaran (2003) also explains that this method has the least bias and

offers the most generalizability of findings. Secondly, the researcher used purposive sampling

because the respondents were few and it gives an inner depth of facts. Systematic sampling was

30
also used by getting every 5th respondent to represent the others. This means that each

respondent has equal chances of representing the whole.

Table 2: Sampling techniques

Sampling techniques Category

Random Outlets manager
Customer attendants
Customers
Purposive General manager
Field managers
Systematic Sales personnel
Source; Drawn by the researcher using ideas from Mbabazi (2008)

3.7 Methods and instruments of data collection

During the research, the researcher decided to chose two instruments of data collection;

questionnaire and interview guiding questions.

3.7.1 Questionnaire

The researcher employed questionnaire as the major data collection instrument where the

questions were both structured and semi structured. A questionnaire is a form to be filled by the

researcher, respondent, or research assistant (enumerator), it consists of questions to be

answered, and statements to be completed by respondents (Sekaran, 2003). The questionnaire

was administered to respondents including managers, marketing managers, sales representatives

and customers. A questionnaire suited the researcher’s expectations because the population under

study is literate and time is limited, and the information required can easily be described in

31
writing. The questionnaires will be precise and concise for the respondents to understand and

hand delivered to them.

3.7.2 Interview

Oso and Onen (2009) define an interview as a person to person verbal communication in which

one person (or a group of persons) asks the other questions intended to elicit information or

opinions. One interview guide was prepared to cater for all customer respondents. Interviews

were conducted and enabled the researcher to establish rapport with potential participants and

therefore gain their cooperation. They also allowed the researcher to clarify ambiguous answers

and when appropriate, seek follow-up information from the respondents.

3.8 Data management and analysis

The researcher used both qualitative and quantitative methods of data analysis. Qualitative

method was used mostly in analysis of data by using a narrative technique. Finally, data were

then analyzed and interpreted in relation to findings. Also qualitative data from respondents was

arranged according to themes which the researcher critically reviewed and analyzed in relation to

each of the research questions and objectives of the study and then present the data in a narrative

form. Quantitative data got from questionnaires was prepared for analysis to make it as error free

as possible. Preparation for data analysis involved editing, coding and computer data analysis

(Amin, 2005).

Quantitative data were analyzed using descriptive statistics (averages and percentages) to

meaningfully describe the distribution of scores or measurements (Oso and Onen, 2008). Also

the quantitative data were analysed using the the Pearson’s rank correlation co-efficiency which

is provided in the following formula.

32
 r= n Σxy -ΣxΣy

nΣx²- (Σx) ² n Σy²-(Σy) ²

Where;

r = Pearson’s correlation co-efficiency and

n = Frequency.

3.9 Reliability and validity

Mbabazi (2008) says that reliability is the extent to which a tool is consistent in what it measures.

In order to ensure reliability of the instruments, 10 copies of the questionnaire were designed and

pre-tested with business owners and customers whom the researcher did not involve in the study.

This exercise involved administering items that would measure a certain concept to a set of

respondents and then comparing the results of the scores obtained at the two different times from

one and the same set of respondents and then comparing the results of the scores obtained at the

two different times from one and the same set of respondents (Sekaran, 2003).

Ateenyi (2008) says that validity is the concept of producing findings that are in agreement with

theoretical/conceptual values; it is the producing of accurate results. To ensure validity the

researcher constructed instruments that would capture or measure certain concepts that would be

relevant to the study. The study applied a validation test where the researcher ensured that a

panel of expert researchers; supervisors and research experts and participants evaluate the

instruments to assess their content validity and whether the instruments designed likely capture

the required data.

33
3.10 Ethical considerations

The researcher put into consideration the following code of ethics while carrying out research on

both the employer and employees and customers;

• A letter of introduction/recommendation from the Faculty of Business Administration

and Management (BAM), Uganda Martyrs University (UMU) was obtained and

presented to the authorities (respondents) to allow the research to carry out the study.

• Before requesting any information from respondents, they were be asked if they agreed to

be interviewed and answer questions. In this case, confidentiality was maintained among

the respondents and their names were published without their consent.

• Relevant explanations were provided regarding the objectives and possible benefits of the

study to help respondents have a clear view of what the research in looking for. The

researcher ensured that all questionnaires are answered by the respondents not by

researcher herself.

3.11 Conclusion

Chapter three has presented and described the approaches and techniques the researcher used to

collect data and investigate the research problem. It included research design, study population,

sample size and selection, sampling techniques and procedure, data collection methods, data

collection instruments, pretesting (validity and reliability), procedure of data collection, data

analysis and measurement of variables, ethical considerations and conclusions.

34
 CHAPTER FOUR

DATA PRESENTATION, ANALYSIS AND INTERPRETATION

4.0 Introduction

This chapter focuses on the presentation, analysis and interpretation, and discussion of findings

on the relationship between advertising and sales level. It is based on study’s objectives which

are two, namely; the relationship between newspaper advertising and the level of sales, radio

advertising and level of sales. It is presented in form of tables in percentages and frequencies.

The information in this chapter was obtained mainly using questionnaires. However, this chapter

will first examine respondents’ demographic characteristics.

35
 4.1 Demographic characteristics of respondents

Table 3: Demographic characteristics of MTN employee respondents

Name Subgroups Frequency Percentages

Age (Years) Above 50 4 12.5
41-50 6 18.8
31-40 10 31
21-30 12 37.5
Totals 32 100
Gender Female 12 37.5
Male 20 62.5
Totals 32 100
Level of education Masters 2 7
Degree 6 19
Diploma 10 31
Certificate 14 43
Totals 32 100
Marital status Married 17 53
Separated 2 6.3
Single 10 31.4
Widowed 3 9.3
Totals 32 100
Department Human resources 4 12
Marketing 16 50
Finance 5 15.7
Procurement 7 22
Totals 32
Years of experience Above 10 years 6 18.75
7-10 10 31.25
4-6 4 12.5
1-3 9 28.1
Less than a year 3 9.4
Totals 32 100
Source: Primary Data.

Table 3 indicates that 37.5% of respondents were between the age of 21-30 and 12.5 % were

above 50 years. All respondents were above the age of 18, meaning that they knew what they

responded because they were mature enough to analyse the questionnaires.

36
For gender, Table 3 shows that 62.5% of the respondents were male while 37.5% were female.

This shows that research male respondents were active than females. Thus this research was not

gender balanced, where the men outweighed the females. Men responded in a timely manner and

they were flexible more than women respondents.

Concerning levels of education, it is evidenced that the respondents from MTN hold a range of

educational qualifications. However, majority of respondents were certificate holders with 43%,

and the least were master’s degree holders with 7%.

As shown in Table 3, majority of respondents were married with a percentage of 53, whereas

singles had the least percentage of 31.3%.

It is evidenced from Table 3 that 50% of the respondents were from the marketing department,

where as the Human resources department had the least respondents with 12.5%. These results

show that the MTN consist of organizational structures consisting of various departments and/or

position settings which they use to advertise their products. A 50% response from the marketing

department shows that MTN use this department to advertise for its products and features.

As illustrated in Table 3, it is still evident that majority of employees have stayed with MTN

between 7 and 10 years with a 31.25% while 9.4% have worked in the industry for less than a

year. This implies that MTN retains its employees and has low levels of employee turnover.

37
4.2 General findings of advertising and sales level

Table 4: MTN advertising in relation to products

Details Frequency Percentage

Strongly Agree 15 46.9

Agree 15 46.9

Not sure 2 6.3

Disagree 0 0

Strongly disagree 0 0

Total 32 100.0

Source: Primary Data.

Table 4 indicates that 93.7% of respondents agreed that industry advertises all its products, 6.3%

were not sure, and none of the respondents Disagreed. This implies that MTN is aware of the

importance of advertising and it expects advertising to have a positive impact on their sales.

This section focuses on establishing the relationship that exists between advertising of products

and sales level. It looks at advertising as independent variable while sales level is a dependent

variable. The selections tested to select the relationship are the respondents. Perception relating

to advertising in the company Table 4 and their perceptions on how advertising increases the

number of products bought in Table 15. The findings of the section are summarized in the

following table.

38
Table 5: General analysis of the relationship between advertising and sales level

Scale Advertising (x) Sales Level (y) Xy x² y²

Strongly 15 9 135 225 81

agree
Agree 15 12 180 225 144
Not sure 2 4 8 4 16
Disagree 0 4 0 0 16
Strongly 0 3 0 0 9
disagree
Σ(x) 32 Σ(y) 32 Σ(Xy) 323 Σ(x²)454 Σ(y²)266
Source; Field Data

r= n Σxy -ΣxΣy

nΣx²- (Σx) ² n Σy²-(Σy)²

32(323) -32(32)

32 (14,528 – 1,024) (32 x 266 - 454)

10,336-1024

(13,004) (8,058)

9,312

105,098,328

9,312

10,251

r= 0.908

39
There is a strong perfect and positive relationship between advertising and sales. This is

supported by a positive relationship of 0.908. The results explicate that the relationship between

advertising and level of sales works in both directions. This means that when advertising

decreases, the level of sales decreases and if advertising increases also the level of sales increase.

This agrees with Sundarsan (2007) who evaluated the effectiveness of advertising on sales level

of small and large firms, and for multinational corporations and the findings showed that

advertising directly influenced the level of sales.

Table 6: Television as a means of advertising

Details Frequency Percentage

Strongly agree 21 65.6

Agree 10 31.4

Not sure 1 3

Disagree 0 0

Strongly agree 0 0

Total 32 100.0

Source: Primary Data.

Table 6 indicates that, 65.6% of the respondents strongly agreed that television is the leading

means of advertising used by MTN, where as 3% were not sure. This indicates that MTN uses

television as a means of advertising. Many people have watched and followed MTN adverts

displayed and played on local televisions. Thus televisions play a vital role in increasing the level

of sales by attracting and influencing customer buying decisions.

40
Table 7: Newspapers as a means of advertising

Details Frequency Percentage

Strongly agree 12 37.5

Agree 14 43.7

Not sure 6 18.8

Total 32 100.0

Source: Primary Data.

As evidenced from Table 7, majority of respondents at 43.7% agreed that newspapers were used

as a means of advertising, whereas the least with 18.8% were not sure. This implies that MTN

uses Newspapers as a form of advertising to reach out to their customers. This supports research

by Chauvin and Hirshey (1993), Desai (2000), Joshi and Hanssens (2009), cited by Tuli et al.

(2012) indicating that when companies spend more money on newspaper advertising, investors

see this as a strategy to increase the consumer base leading to more sales.

Table 8: Radio as a means of advertising

Details Frequency Percentage

Strongly agree 20 62.5

Agree 12 37.5

Not sure 0 0

Disagree 0 0

Strongly agree 0 0

Total 32 100.0

Source: Primary Data.

Table 8 indicates that 62.5% of the respondents strongly agree that Radios are used as a means of

advertising, 37.5% agreed, none disagreed nor were not sure. This implies that the radio is one

41
important advertising media used by MTN group to promote its goods and services. This finding

supports Simon and Arndt (1980) research on radio’s impact on sales. The results demonstrated

that radio campaigns have the highest efficiency levels when compared with all classic

advertising channels. Accounting for the actual market structure, the analysis also integrated the

effects of communication activities of two key competitors, also pure plays of similar size and

providing nearly exchangeable services. Radio campaigns were found to strongly affect the

success of all players in the relevant category and, thereby, increase competitors' sales (Simon

and Arndt, 1980 as cited by Sauls & Greer, 2007).

4.2.1.1 Other forms of advertising used by MTN

According to respondents, MTN use Billboards as a large outdoor advertising structure. MTN

Billboards are typically found in high-traffic areas such as alongside busy roads like Kampala –

Masaka road, Masaka – Mbarara road, e.t.c. Billboards present large advertisements to passing

pedestrians and drivers. Typically showing large, ostensibly slogans, and distinctive visuals,

billboards are highly visible in the top designated market areas. MTN use painted billboards,

digital and mobile billboards. Painted billboards are painted in large studios and the image is

projected on the series of paper panels (MTN annual sales report, 2013).

Newsletters can be online or printed out and are regularly used by MTN and distributed to

customers to provide information of interest to members, customers, or employees. Sending

newsletters to customers and prospects is a common marketing strategy used by MTN, which

can have benefits. According to the marketing manager, MTN group emit newsletters in order to

improve or maintain their reputation in the society. General attributes of newsletters include

news and upcoming events of the related organization, as well as contact information.

42
Table 9: MTN adverts reach the intended audience

Details Frequency Percentage

Strongly agree 8 25

Agree 14 43.8

Not sure 10 31.3

Disagree 0 0

Strongly agree 0 0

Total 32 100.0

Source: Primary Data.

Table 9 indicates that a 43.8% of respondents agreeing that MTN adverts reach the intended

audience, 31.3% were not sure, 25% strongly agreed and none disagreed nor strongly disagreed.

This implies that the organization’s adverts reach their customers. Audiences are reached using

different media being conducted in different languages which these audiences are familiar with.

For example, a number of radio stations are being used locally to advertise for their goods and

services. By using these local radio stations also the languages used are those that can be clearly

understood. For example radios; Voice of Kigezi in Rukiga, West in Runyankole, CBS in

Luganda, and Voice of Jinja in Lusoga, and many others

4.2.1.2 Services offered by MTN

MTN sells air time vouchers to its subscribers. These vouchers ranges from 500/=, 1000/=,

2000/=, 5000/=, 10000/= and 20000/=, 40,000/= and 100,000/= denominations. These vouchers

can be found in specific MTN service center shops, outlets, retail and wholesale shops. However,

small denominations vouchers are mostly used by people and customers of MTN in remote area

whereas big denominations are used in bigger towns. For example, vouchers of 20000/= and

43
40000/= were found at the service centre but not in retail shops. On acquiring these recharge

vouchers, customers simply scratch off the silver panel to reveal the access number underneath,

then you can use either loading option: by direct dialing *155*Access Number# or by using the

voice option - dial 155 and follow the voice prompts. Also, some customers use PayAsYouGo

Express option where an Electronic Voucher Distributor (EVD) is used. It is a quick easy paper-

print-voucher system enabling PayAsYouGo customers to load airtime without scratching

a voucher. This service is available in select MTN outlets.

MTN offers MTN EasyLoad service, a faster and greener way of loading MTN airtime, direct

from a vendor’s phone to customers’ phone. It is the same MTN airtime, but loaded in a different

way. Customers simply provide their telephone number and airtime amount they would like to

purchase to the airtime vendor, and then the vendor loads the desired amount directly to their

MTN account electronically. MTN subscribers can load as low as UGX 50 worth of airtime.

MTN offers MTN mobile money, an electronic wallet service that enables you to send and

receive money anywhere in Uganda using your phone (Angumya, 2013). This service is

available to every MTN Mobile customer to send money to any MTN mobile phone user;

registered or not, to send money to mobile phone users on other local networks, to send money

to non-mobile phone users nationwide, withdraw cash at any authorised MTN Mobile Money

agent, pay utility bills, and buy airtime.

MTN also offers Western Union International money Transfer is a mobile money functionality

that allows Mobile money subscribers in Uganda to send and receive money to and from

countries where Western union operates using their mobile phone. They have the option to

44
upload the money into their Mobile Money account or withdraw it at an authorised Mobile

Money agent (MTN newsletter, 2011).

According to Angumya, (2013), MTN still offers internet data for its subscribers. Every

beginning of the month, each MTN subscriber receives 15MBs free data that can be used at any

time for the internet. Besides, there are other data packages provided by MTN. these packages

are paid for by customers where they purchase data starting from 300/= for 10 MBs.

Other services include elite program, magic number, MTN caller Tunez, MTN magic voice,

MTN play, MTN Afrinolly, MTN Contact Exchange, MTN radio, Opera Mini, Sim swap and

MTN Loyalty.

4.3. Findings by objectives

4.3.1Newspaper advertising and sales level

4.3.1.1 Use of Newspaper adverts by MTN

Table 10: MTN uses Newspaper advertising

Details Frequency Percentage

Yes 32 100

No 0 0

Total 32 100.0

Source: primary Data

Table 10 indicates that, all the respondents accepted Newspaper advertising as being used by

MTN. Respondents mentioned different newspapers that are used by MTN when advertising and

these include; New Vision, Bukedde, Olupiny, Orumuri, Etop, Weekly Observer, Eddoboozi,

45
The Daily Monitor, The Red Pepper, and tabloids like Onion, The Kampala Sun, and Enyanda.

Respondents appreciate the role of newspaper advertising basing on the fact that they are cheap.

These local newspapers have enticed many people to buy from MTN products. This agrees with

McAlister, Srinivasan and Kim (2007) noting that newspaper advertising communicates and

informs consumers which “enhance brand loyalty” and this indirectly translates into sales.

One manager at the service centre continues to assert that;

We spend all of money in Newspaper advertising; different newspapers and tabloids have
been used here every day. We don’t regret because we see the returns, and we shall
continue using them because they meet our expectation (Employee questionnaire)

4.3.1.2 Benefits of Newspaper advertising to MTN

According to respondents, because newspaper advertising is so affordable, it is an ideal medium

to build “top of mind” awareness with frequency campaigns. Customers read newspapers at their

own convenience and so building a top of mind awareness for a specific product. It means they

can always go back and read, or review what was published.

Other respondents also intimated that newspapers offer enormous flexibility in content, design,

placement and frequency. Plus, newspapers are a “rapid response” medium – MTN can refine its

message or change your whole campaign in just two days. Ads can be almost any size and shape,

including L-shapes and wraparounds, as noted by the Marketing Manager.

In carrying out an interview with one of the field officers of MTN, he noted that;

Print Newspaper advertising has elevated MTN’s reputation, especially when it

purchases advertising in regional editions of national magazines and frequently read

newspapers. When customers see a local business featured in a national publication, they

46
 view the brand with more respect than if it was only featured in a small local publication

(Interview guide)

Newspaper print ads allowed MTN to reach a more targeted audience than online ads, which

may reach people all across the nation or even the world. Newspaper ads in local newspapers can

reach a more specific group of people than through online advertising campaigns, which are

often viewed by a highly diverse group of people who may not have any interest in your product

or service. “As you see our life here, it’s hard to have access to televisions. So the only way to

access MTN adverts is by reading Newspapers. Sometimes we read not up to date newspapers

but because it is the only option,” asserted by a customer from Kitabaazi.

Still, print newspaper adverts may continue to reach the target audience long after the original

publication. Magazines and other print publications may linger in the waiting rooms of doctors',

teachers’ local leader’s offices and other venues for months, while online ads are only posted for

a specified amount of time and then replaced (American Marketing Association, 2013).

4.3.1.3 Newspaper advertising and sales level

According to the MTN marketing Manager, there is a direct relationship between newspaper

advertising and sales. He mentioned that, MTN sales have increased almost every day due to

continued use of cheap newspaper adverts.

Thus, McAlister, Srinivasan and Kim (2007) in their findings agree that newspaper advertising

communicates and informs consumers which “enhance brand loyalty” and this indirectly

translates into sales. Research by Chauvin and Hirshey (1993), Desai (2000), Joshi and Hanssens

(2009), cited by Tuli et al. (2012), in their recent research agree that when companies spend

more money on newspaper advertising, investors see this as a strategy to increase the consumer

47
base leading to more sales. Eng and Keh (2007), analyze the joint effect of newspaper

advertising on brand value of the firm’s future operating and market performance. They find that

impact of newspaper advertising on future stock performance is minimal, but spending on

advertising results in better brand sales.

According to a customer of MTN, newspapers have been increasingly assailed by other media

taking away not only their readers, but their principal sources of profit. Many of these 'new

media' are not saddled with expensive union contracts, printing presses, delivery fleets and

overhead built over decades.

One of the customer said that cheap internet has led to a shift from buying print newspapers to

reading online newspapers.

It takes me only less that 100/= to read a full Monitor news paper online that would cost
for 1500/= for a printed on (Interview guide)
Thus many people have shifted from buying print newspapers thereby lessening the targeted

customers.

Also MTN has got a challenge of political views among Ugandans. Most respondents have a

misconception about some newspaper publications. They think that some newspapers like

Bukedde and New Vision are government firms. Thus some have decided to shun and boycott

these news papers because they think they are not in their political lines. Therefore, they are not

able to grab MTN adverts (Angumya, 2013).

This agrees with McHugh (2000), that the rise of cable and satellite television in Uganda has

eroded newspaper adverts and sale. Television provides quick and visual images in form adverts

48
that explain all the details of the products and features of MTN. With newspaper adverts, a

product can’t be demonstrated how it works and how the user interacts with it.

Busari (2002) agrees that MTN has also got challenges with the language barrier. Although

MTN has tried to use different local newspapers to reach their customers, some subscribers are

illiterates who cannot read and write. The CIA World Factbook, (2010), states that the illiteracy

rate in Uganda was at 33.2% of which male accounted for 23.2% and women at 42.3. Therefore,

they find it challenging to read an advert printed in the newspapers although these adverts are

printed in their own languages.

MTN has tried to use local televisions to reach their local subscribers by demonstrating how

these products and features work. Also MTN have used typical local cones from different areas

to reach out to their subscribers. These include Voice of Katwe, Voice of Nyendo, and others.

These speak about the available products using local languages.

MTN has also placed online adverts to their websites and other hosting websites to capture

customers who usually use the internet. During the research exercise, many youth were spotted

with smart phones browsing the internet; and checking their email. This means adverts can be

accessed on the internet at a subscribers’ convenience (Angumya, 2013).

MTN has also used the social media platform to target their customers. These include Facebook,

twitter, Myspace, LinkedIn and others. Through these platforms, MTN posts different adverts

and subscribers access them free of charge. MTN has also put an option of liking these pages to

any customer registered on these social networks. Customers are kept together by providing

discussion topics where these customers give out their views.

49
In a bid to widen the MTN customer base in different parts of Uganda, the Marketing manager

asserts that;

There have been a door to door campaign where MTN has employed a good number of
youth to go in the field and talk directly with these MTN subscribers about what they feel
should be improved in MTN services (Interview guide)
These subscribers have welcomed this strategy and it has been a success to MTN because they

feel they are part of the group – they feel they are not discriminated.

A number of seminars and workshops have been organised on the ground to sensitize people on

the available products and services of MTN. The general manger mentioned a Mobile money and

western union money transfer workshop was carried out for 3 days at MariaFlo hotel. All

allowance waivers were catered for by MTN, and everyone was invited to participate in this free

workshop. It was a free participatory workshop where subscribers were allowed to ask many

questions on how to use MTN mobile money and Western union.

Table 11 Relationship between newspaper advertising and sales level using Pearson’s
Correlation

Scale Newspaper (x) Sales level (y) Xy x² y²

Strongly agree 12 9 108 144 81

Agree 14 12 168 196 144

Not sure 6 4 24 36 16

Disagree 0 4 0 0 16

Strongly agree 0 3 0 0 9

Σ(x) 32 Σ(y) 32 Σ(Xy) 276 Σ(x²) 376 Σ(y²) 266

Source: Field Data

50
 Therefore, r= n Σxy -ΣxΣy

nΣx²- (Σx) ² n Σy²-(Σy)²

32(276) – 32(32)

32(376– (32)² 32(266) – (32)²

8832 - 1024

(12032 – 1024) (85652 – 1024)

7808

93,149,696

7808

9651

r = 0.809

This findings reveal that as one variable increases in value, the second variable also increase in

value. Similarly, as newspaper advertising decreases in value, the level of sales also decreases in

value. This is called a positive correlation. In Table 18, the researcher’s Pearson’s r value of

0.809 was positive. So, positive is the default. Since our Pearson’s r is positive, we can conclude

that when the newspaper advertising increases (our first variable), the level of sales of MTN (our

second variable) also increases. This agrees with Bothwell et al., (2011) has found positive and

statistically significant relationships between newspaper advertising and sales.

51
4.3.2 Radio advertising and sales level

4.3.2.1 Responses on radio advertising

Table 12: Advertising and increase in sales level

Details Frequency Percentage

Strongly agree 9 28

Agree 12 38

Not sure 4 13

Disagree 4 13

Strongly disagree 3 9

Total 32 100.0

Source: Primary Data

Table 12 reveals that majority of respondents with 38% agreed that advertising increase sales

level noting that if a product is introduced on the market, people need to know its features and

where to get it, and that’s the reason for its advertising whereas 9% strongly disagreed. They said

that there was no any relationship between advertising and sales level. These respondents said

that even if a firm doesn’t advertise, people will look for its product. They said that since MTN

has already got a brand name, people only search for their products without even following its

adverts! However, Angumya, (2013) disagrees with these respondents saying that advertising is a

continuous process and should be carried out every single day of product existence.

52
Table 13: Radio advertising used by MTN

Details Frequency Percentage

Yes 32 100

No 0 0

Total 32 100.0

Source: Primary Data.

Table 13 shows that all respondents agreed that MTN uses radio advertising. A number of radio

stations are being used locally to advertise for their goods and services. By using these local

radio stations also the languages used are those that can be clearly understood. For example

radios; Voice of Kigezi for Rukiga, West for Runyankole, CBS for Luganda, Voice of Jinja for

Lusoga. Therefore, the use of different languages on radio stations has enhanced and facilitated

the urge of customers to capture well what is been offered by MTN hence arousing their buying

decisions.

Different languages are used on different radio stations. This is because different people have

different culture and languages which are different from others. In Uganda, we have more than

56 languages spoken by different tribes. According to respondents, MTN finds it difficult to

advertise using all these languages. The challenge is that, some languages are spoken by a few

dialects. Therefore, MTN only concentrated on mostly spoken languages of Luganda, Rukiga,

Runyankole, English, Luo, Lugbar, Itesot, Lusoga, Runyoro, and Rotooro. Other like Rusamya,

Lur, have been left out because it is taken by a few people.

According to one of MTN’s sales personnel and a customer too, appreciates that radio adverts

are understood clearly as they are intended.

53
 I listen to my phone radio at my convenience, even when am doing official work
(Interview guide)
She continues to assert that adverts are played in a funny way but not forgetting to carry the

meaning. She notes that she cannot forget these adverts because they are sometimes played by

her favourite comedians and personalities like Pablo Kimuli, Omulangira Ndausi, Abby Mukiibi,

Kato Lubwama, Patricko Mujjuka and others.

Some respondents said that these radio adverts do not last long on radios and because they lack

that visual touch, they are usually forgotten. This is because they are played once and it

disappears. Because there are other adverts of the same formula, listeners end up listening for

formality whatever is put on radio. This agrees with a recent research by Kotler (2010) almost

any business want to put an advert in newspaper not bearing mind that these ads are swept away

by time.

Also, other respondents pointed it out that unlike television where one sits and concentrates on

the advert being played; it is not the case with radio adverts. They said that radios are listen to

when doing other works like walking and one get many things that destruct his/her attention thus

forgets easily. Whereas if is a TV set, one has to watch the visual images.

One cannot put a TV set in a sitting room and watches it from the bedroom”, noted by
one respondent (Interview guide)
Another customer in response to concentration on radio ads asserts that;

Actually we have a radio played at the office almost every day but I have taken little time
to listen to what specifically the radio is delivering. However I always have music in the
background and different voices of presenters plus adverts but take little time to
concentrate on them (Interview guide)

54
4.3.2.2 Radio advertising and increase in the level of sales

According, to the finance manager of MTN (names withheld), there have been a great and steady

increase in the level of sales in MTN due to radio advertising. However, when asked specifically

the level at which radio advertising increased the level of sales, he was not safe to declare what

they had from their data bank. But he continued to say that MTN invests a lot in radio

advertising because many Ugandans have continued to listen to their respective local radios.

Table 14 Radio advertising and sales level using Pearson’s Correlation

Scale Radio (x) Sales level (y) Xy x² y²

Strongly agree 20 9 180 400 81

Agree 12 12 144 144 144

Not sure 0 4 0 0 16

Disagree 0 4 0 0 16

Strongly agree 0 3 0 0 9

Σ(x) 32 Σ(y) 32 Σ(Xy) Σ(x²) 544 Σ(y²) 266

324

Source: Field Data

Therefore, r= n Σxy -ΣxΣy

nΣx²- (Σx) ² n Σy²-(Σy) ²

32(324) – 32 (32)

32(544) – (32)² 32(266) – (32)²

10368 – 1024

(17408 - 1024) (8512 – 1024)

55
 9344

(16384) (7488)

9344

122,683,392

9344

11076

r = 0.843

Therefore, the closer r is to +1, the stronger the positive correlation. This means that there is a

strong positive relationship between your two variables; radio advertising and sales level. This

means that changes in one variable are strongly correlated with changes in the second variable.

Table 17 shows Pearson’s r is 0.843. This number is very close to 1. For this reason, we can

conclude that there is a strong relationship between radio advertising and sales level variables.

However, we cannot make any other conclusions about this relationship, based on this number.

Thus in all, the study concludes that there is a strong positive correlation between advertising and

sales level. This is shown by Pearson correlation analysis (r=0.908) supported by the responses

from the questionnaires. According to Pearson’s rule, any variable close to +1 indicates a strong

positive correlation. Therefore, 0.908 means there is perfect correlation between advertising and

sales level. Therefore, a positive correlation means that if MTN continue to increase their

advertising campaigns, their level of sales will also increase.

56
 CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSIONS, AND RECOMENDATIONS

5.0 Introduction

This chapter summaries the field discoveries, draws conclusions and recommendations and end

with areas for further research. The objective of the research was to examine the impact of

advertising on the sales level of MTN group.

5.1 Summary of major findings

First, it was established that there is a direct and positive strong relationship between newspaper

advertising and level of sales. The researcher found out that newspaper advertising leads to high

level sales both in the short and long run in MTN.

Secondly, the researcher found out that radios are widely used by MTN in their advertising

campaigns. This is illustrated from the Pearson’s correlation where the research got a positive

correlation which means there is a strong relationship between radio advertising and sales level.

Thus people develop higher perceived intimacy from these radio campaigns and broadcasts

thereby making applied decisions and their influence to buy hence increasing the sales level of

MTN.

In general, it was established that there is a strong perfect and positive relationship between

advertising and sales. This is supported by a positive relationship established by Pearson

correlation (0.908) together with the positive responses from the questionnaires. The variables of

57
advertising and sales are not only integrated in the same order but also co-integrated. The results

explicate that the relationship between advertising and level of sales works in both directions.

This means that when advertising decreases, the level of sales decreases and if advertising

increases also the level of sales increase.

5.2 Conclusions

Firstly, newspaper adverts continue to play a bigger and vital role in increasing the level of sales

in MTN with a positive correlation therefore, MTN should take newspaper advertising seriously

as its first priority in its advertising campaign. It is widely used by people in Masaka region and

accessed by a majority of people in their respective languages. Thus MTN newspaper adverts are

accessed by different customers in the languages they understand; hence they stimulate buying

decisions of customers thereby increasing on the level of sales of MTN.

Secondly, Radios are convenient advertising media used by majority of people in Masaka

because they deliver adverts in form of drama, comedy and persuasion which capture the minds

and hearts of customers and hence influence them to buy from MTN products. Therefore, radio

campaigns should be adopted because they strongly arouse buying decisions of customers and,

thereby, increase MTN level of sales thus a strong positive relationship between radio

advertising and sales level. Therefore, radios will greatly affect MTN level of sales.

5.3 Recommendations

1. MTN should continue using newspapers and radio in their advertising campaigns because

they capture a wide market base. Radio and newspapers are the cheapest advertising

media according to the respondents and they yield good returns for both short and long

run.
58
 2. MTN should focus more on local radio stations as most respondents knew more of their

programs than radios from other regions and to use different common local languages

when advertising used in Masaka so that every individual can get the messages from the

adverts as it is intended by the sender. Due to illiteracy in Masaka, some MTN customers

have not been able to interpret these adverts that are sometimes presented in strange

languages.

5.3.2 Suggested areas for further research.

Due to limited time, this research is not conclusive as such. It is therefore important that further

research be carried out on the following topics.

1. Television advertising and sales level

2. Effects of persuasive advertising on sales level

59
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 APPENDIX II

Employee/Staff Questionnaire
QUESTIONNAIRE FOR THE IMPACT OF ADVERTISING ON SALES LEVEL: A
CASE STUDY OF MTN – MASAKA REGION
Dear respondent,
My name is Kato Joseph Sseruwu. I’m currently carrying out a study on impact of advertising on
sales level for award of Bachelors degree in Business Administration and Management of
Uganda Martyrs University. I therefore, kindly request you to provide me with relevant
information in this exercise. The information provided will only be used for academic purpose
and will be treated with utmost confidentiality.
Thank you in advance
SECTION ONE: BACKGROUND INFORMATION
In each section, tick in the box or fill in your response in the space provided as appropriate.
1. Age: 21-30 31- 40 years 41-50 years Above 50 years
2. Gender: Male Female
3. Level of education; Certificate Diploma Degree Masters
Any other please specify………………………
4. Marital Status: Married Separated Single Widowed
5. Period worked with MTN: Less than a year 1-3 years 4-6 years 7-10years
Above 10 years
6. Department: Finance Marketing Administration Procurement Other
7. Position held: Managerial level Middle level Operational level
SECTION TWO: NEWSPAPER ADVERTISING AND SALES LEVEL
Please rank the following statements on scale ranging from strongly agree to strongly disagree by
ticking in the right box.
1. MTN advertises all its products.

Strongly agree Agree Not sure Disagree Strongly disagree

2. The organization uses the following forms of advertising.

Strongly agree Agree Not sure Disagree Strongly disagree

i
 Television
Newspapers
Radio

3. Apart from the above, what forms of advertisement being used by MTN?
................................................................................................................................................
................................................................................................................................................
4. MTN adverts reach the intended audience.

Strongly agree Agree Not sure Disagree Strongly agree

5. What services are being offered by MTN

………………………………………………………………………………………………………
………………………………………………………………………………………………………
SECTION THREE: NEWSPAPER ADVERTISING AND SALES LEVEL
1. Does MTN use Newspaper Advertising?
Yes No
If No, explain why
………………………………………………………………………………………………………
…………………………………………………………………………………...............................
2. In your opinion what are the benefits of newspaper advertising to MTN?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
3. In your opinion does Newspaper advertising helps to increase MTN sales?
………………………………………………………………………………………………………
………………………………………………………………………………………........................
4. In your opinion what are the challenges of Newspaper advertising?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
5. How does MTN react to these challenges?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
SECTION FOUR: RADIO ADVERTISING AND SALES LEVEL

ii
1. Does Radio advertising being used by MTN in its promotional campaigns?
Yes No
If No, why
………………………………………………………………………………………………………
………………………………………………………………………………………........................
2. What radio stations are being used by MTN in its advertising campaign?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
3. What languages does MTN use when advertising on radios?
………………………………………………………………………………………………………
………………………………………………………………………………………........................
4. In your opinion do you think radio listeners understand MTN radio adverts?
………………………………………………………………………………………………………
………………………………………………………………………………………........................
5. In your opinion does radio advertising increased the level of sales in MTN?
………………………………………………………………………………………………………
………………………………………………………………………………………........................
6.In your opinion do you think advertising increases level of sales?
............................................................................................................................................................
............................................................................................................................................................
6. In your opinion what are recommendations you would give to increase sales through radio
advertisement?
I. ……………………………………………………………………………………………
II. ……………………………………………………………………………………………
III. ……………………………………………………………………………………………
Thank you for your participation

iii
 APPENDIX III

EMPLOYEE/STAFF INTERVIEW GUIDE

INTERVIEW GUIDE FOR THE IMPACT OF ADVERTISING ON SALES LEVEL: A

CASE STUDY OF MTN – MASAKA REGION

Dear respondent,

My name is Kato Joseph Sseruwu. I’m currently carrying out a study on the impact of

advertising on sales level for award of Bachelors degree in Business Administration and

Management of Uganda Martyrs University. I therefore, kindly request you to provide me with

relevant information in this exercise. The information provided will only be used for academic

purpose and will be treated with utmost confidentiality.

Thank you in advance

SECTION A:

1. What services are being offered by MTN?

2. Do you normally read these adverts?

3. In your opinion what are the benefits of newspaper advertising to MTN?

4. Is newspaper appropriate to you?

5. What radio stations are being used by MTN in its advertising campaign?
6. Have you listened to an advert today?
7. In your opinion do you think radio listeners understand MTN radio adverts?
8. In your opinion does radio advertising increased the level of sales in MTN?

Thank you in advance

iv
 APPENDIX IV

Time frame work for conducting the research study

ITEM NO. ACTIVITY DESCRIPTION TIME SCOPE

1 Formulation of research topic March 2013

2 Topic approval April 2013

3 Writing a proposal Oct – Nov 2013

4 Approval of proposal February 2014

5 Pilot study March 2014

6 Gathering data March – April 2014

7 Analysis and interpretation April 2014

8 Handing in the first draft May 2014

9 Handing in the final draft Ju 2014

v
 APPENDIX V

Budget frame work

ACTIVITY DESCRIPTION AMOUNT PER RATE TOTAL AMOUNT

Lunch 3,000 per day 90,000

Transport to the field 3,000 per visit 60,000

Transport to the supervisor 8,000 per visit 80,000

Printing 500 per paper 250.000

Flash disk 2 4 and 2 GB 45,000

Ream of papers 2 25,000 50,000

Pens, pencils, note books…. 50,000

Photocopying 50,000

Final printing and binding 100,000

TOTAL 775,000

vi