EFFECT OF ADVERTISING ON CUSTOMER BEHAVIOR AND RETENTION
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EFFECT OF ADVERTISING ON CUSTOMER BEHAVIOR AND RETENTION
Abstract
This study looked at the impact of advertising on customer behaviour and retention. The objectives were to determine the impact of advertising on customer behaviour, customer retention, and the function of advertising in shaping consumer perception. A survey research design was used for this investigation. We used both primary and secondary data sources.
The primary data consists of a structured questionnaire administered to target respondents who were clients of reputed fast food establishments in Ibadan, whilst the secondary data consists of the use of related materials, magazines, and periodicals.
The study recommended that organisations embrace and accept the marketing strategy that allows them to outperform competitors in producing, delivering, and communicating superior customer value to their chosen target markets.
Chapter one
Introduction
1.1 Background of the Study
Organisations and enterprises have always faced resource constraints. Because of this constraint, it is critical to employ them wisely and effectively. One thing that distinguishes a company from its competitors is how it utilises its resources.
One of the most essential resources that organisations have is financial resources, such as budgets, some of which are set aside for advertising. A successful advertising campaign demands funding.
In today’s competitive business environment, no company can become a market leader without spending millions of naira on promotional activities. The primary goal of advertisers is to acquire valuable customers by influencing their attitudes,
knowledge, and purchasing behaviour. Awareness types of communication include events, personal selling, public relations, direct marketing, word-of-mouth marketing, and advertising (Fill, 1999; Kotler, 2010).
It is apparent that any organisation tends to develop towards a position where customer happiness is prioritised. In other words, customer satisfaction is a construct that must be optimally met in order to achieve specified objectives efficiently and effectively, as well as to ensure the smooth operation of business.
Customer satisfaction is a critical component of organisational objectives that must be met in order for a company to retain consumers. Customers are a valuable asset that must be kept satisfied.
The existence of any business-oriented organisation is defined by the performance of business activities that flow from the organisation to identified target customers via the provision of need-satisfying packages in order to satisfy the customers’ needs and achieve the organization’s stated objectives.
Satisfying the needs of the individual customers allows for the possibility of retaining the customer and creating customer loyalty for future purchases. Similarly, client retention is a powerful predictor of organisational goals.
The level of client retention influences to some extent the level of achievement of organisational goals. In other words, if clients do not patronise or repeat purchases of the organization’s products, sales and profitability will undoubtedly suffer, thus impacting the firm’s overall performance.
This thesis focuses on advertising and the numerous ways in which advertisements influence consumer purchasing behaviour. Consumer purchasing behaviour is heavily influenced by elements such as culture, family, and brand image. On the other side, brand awareness encourages customers to acquire a specific product.
As a result, cosmetic industries rely heavily on product advertisement. This analysis also shed light on other aspects that may influence customer buying behaviour, such as lifestyle, purchasing power, technology, traditional culture, and income.
Advertisers invest a significant amount of money in advertising their products, thus they focus on these aspects in order to influence consumer behaviour through advertisements.
Perceptions of brands and purchasing behaviours vary from person to person. As a result, it is critical to understand how customer behaviour has changed. commercials assist businesses in raising client awareness, and the elements in the commercials affect customer perceptions in either a positive or negative way.
People can assess the quality of products by accumulating information, which they typically obtain from ads. Consumer purchasing decisions are influenced by their sense of quality, product awareness, and consumer opinion.
This study critically explores the factors that influence purchasing behaviour and gives in-depth insights into the impact of advertisements in affecting consumer behaviour.
1.2 Statement of the Problem
Companies invest much in advertising because they want to keep their product in the forefront of their customers’ minds. commercials have shown to be a powerful medium for communication, but businesses are still unsure about what elements should be included and how these commercials will aid to affect consumer purchasing behaviour.
Researchers and academicians have emphasised the importance of developing and maintaining consumer satisfaction. This is because the achievement of other company objectives is dependent on the amount and degree of satisfaction achieved by the target market. Organisations prioritise enhancing client happiness and retention.
1.3 Study Objective
The study’s aims are:
To determine the impact of advertising on customer behaviour.
To determine the impact of advertising on client retention.
To determine the role of advertisement in shaping customer perception.
1.4 Research question.
Is there an impact of advertising on customer behaviour?
Is there an impact of advertising on client retention?
Is there a function for advertising in shaping customer perception?
1.5 Research Hypotheses
To ensure the study’s success, the researcher developed the following research hypotheses:
H0: Advertising has no effect on consumer behaviour.
H1: Advertising affects client behaviour.
H02: Advertising has no influence on client retention.
H2: Advertising has an effect on client retention.
H03: There is no function for advertising in shaping customer perception.
H3: advertisements play a role in shaping consumer perceptions.
1.6 Significance of the Study
This study focuses on the impact of advertising on consumer behaviour and retention. It investigates the factors that are changed by advertisements and, as a result, influence consumer buying behaviour and retention.
The study will assist readers in better understanding consumer behaviour while acquiring items, allowing them to design an effective plan for advertising their product. The study will also act as a reference for other researchers who would engage on the similar issue.
1.7 Scope and limitations of the investigation
The scope of the study includes the impact of advertising on customer behaviour and retention. The research is confined to food issues and pepperoni in Ibadan.
1.8 organisational structure Of the Study
This research is organised into five chapters for ease of understanding, as shown below. The first chapter is concerned with the introduction, which includes the (overview of the study), historical background, statement of problem,
objectives of the study, research question, research hypotheses, significance of the study, scope and limitations of the study, study organisation, and term definitions.
The second chapter focuses on the theoretical framework that underpins the study, as well as a review of relevant literature. Chapter three discusses the research design and technique used in the study.
Chapter four focuses on data gathering, analysis, and presenting of findings. Chapter 5 provides a summary, conclusion, and suggestions from the study.
1.9 Definition of Terms
CUSTOMER: In sales, commerce, and economics, a customer is the person who receives an item, service, product, or idea from a seller, vendor, or supplier in exchange for money or other useful consideration.
CUSTOMER RETENTION: Customer retention refers to the ability of a company or product to retain its customers over a certain period.
CUSTOMER BEHAVIOUR: Consumer behaviour is the study of how individuals, groups, or organisations choose, purchase, utilise, and discard ideas, commodities, and services to meet their needs and desires. It refers to consumer actions in the marketplace and the underlying motivations behind those actions.
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