• THE USE OF PROMOTIONAL TOOLS IN BENIN, WEST AFRICA

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THE USE OF PROMOTIONAL TOOLS IN BENIN, WEST AFRICA:
COMPANIES AND CONSUMERS PERCEIVED IMPORTANCE AND EFFECTIVENESS
Michel Dognon, Emporia State University
James A. Stephens, Emporia State University
ABSTRACT
The role of marketing and promotion has not been given much credit
for contributing to the economic development of developing countries.
The results of this field study in Benin, West Africa indicate that
businesses do value highly and use advertising and sales promotion
in marketing strategies. Similarly, the results indicate that local
consumers pay considerable attention to promotional messages although
they value price more highly.
INTRODUCTION
One common goal of countries is the constant search for economic
development to substantially improve standard of living, political
stability and national security. Most of the time, those common
goals generate internal and external competition as Allan and David
(1994) point out, "As more countries seek economic growth,
competition for the world's limited markets and scarce resources
will increase." In such an environment only countries with
specific skills in marketing will successfully compete (Kaynak
1986, Allan 1994 and Kochunny, Rogers, and Rogers 1996). For the
developing countries, marketing activities have been viewed with
disdain and unacceptance (Ross & McTavish 1993). Akaak, Dadzie &
Riordan (1989) identified two schools of thought regarding the use
of marketing to aid economic development. Their are those who
support the applicability of marketing concepts in the developing
countries (Allan 1994, Akaak 1989) and those who oppose their
applicability (Boschart 1993, Bartel 1976, Dadzie 1989).
The first school of thought advocates that marketing is applicable
everywhere including the developing countries. The gap between
developed countries and developing countries in terms of usefulness
of marketing concepts is due to "corporate and country factors"
such as level of economic development, size and profile of companies,
and corporate ownership and nationality (Akaak 1989). For those
who oppose the applicability of marketing to developing countries,
the main argument is that marketing is only specific to post-
industrialized countries. "Their core belief is that the marketing
structures of a country are determined by the level of economic
development" Allan (1994). Indeed, they hold that in the economic
development process, marketing follows economic growth in the
economic development process. The economy is characteristic of
the buyers' market environment. And since the economy of developing
countries reflects sellers' market features, i.e. a situation where
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the proportion of demand is greater that the one of the available
supplies, marketing concepts will not be appropriate.
Historically, developing countries have been viewed as consumers,
and the role of the producer was relegated to developed countries.
Things have changed, and developing countries are shifting their
position. Developing countries no longer specialize in only the
agricultural sector, but have in many instances successfully
embraced the industrial sector (Kochuuny 1996). According to the
1995 World Bank annual report, African industry production grew in
1994 with a special performance in Cote d'Ivoire (Ivory coast) of
a 6.7 percent increase in productive output. Moreover, the report
points out that the Gross Domestic Product (GDP) of African
countries, with the exception of South Africa and Nigeria, grew
by 1.2 percent in 1994 and the growth was expected to increase 3
times that in 1995. As developing countries continue to adopt
business and marketing practices from the developed countries of
the world, local practices will tend to mirror those of businesses
from developed countries. The virtual and global communication
system offers opportunities to all. These facts and the findings
of this study offer support to the applicability of marketing's
use in developing countries. Beyond the principle of the
applicability, the present paper will explore the perceived
importance of promotional tools by West African corporations and
the resulting impact on the local consumers' buying decisions.
RESEARCH FRAMEWORK
Although a number of articles have been written about the
applicability of marketing to the developing countries, (Akaak
1989), few authors include specific transference of products and
promotion as do Keegan, Still and Hill (1987). The perceived
importance of promotion in Benin addresses this concern for
applicability of promotional tools in developing countries. This
is the focal point of this research.
The effectiveness of marketing on sales has been proven by numerous
studies (Jones 1995) eliminating any possible doubt about its
marketing contribution. However, the measurement of the
contribution of other components of marketing has posed more
difficulties. Concerned by the influence of advertising on sales
and consumers' life styles (Evans & Berman 1987), Jones (1995)
suggested four statistical processes that can be used as effective
measurements of marketing components' contribution.
First, the multivariate regression helps to quantify the
coefficient of the diverse independent marketing variables and
measures their impact on the dependent variable most frequently
represented by sales. The second process is what the author
called "controlled experimentation in the market place". It
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consists of marketing the identical products or brands in two or
more similar regions in an identical way, except for the
variations in the marketing or advertising tools. A third
technique is the British Area Marketing Test Evaluation System
(AMTES) that combines economic measurement with regional testing.
Finally, the single source research that determines each household's
reception of advertising for identified brands and relates
advertising "to the purchasing of those same brands by the same
household shortly after the advertising" (Jones, 1995).
Although these analytical processes offer considerable value to
research in many economic situations, their application in developing
economies presents many methodological problems. In developing
countries there are some real limitations to collecting data that
restrict the use of these processes. First there is virtually no
secondary public information to make demographics comparisons
between regions. Proprietary research has not been gathered or
developed and consequently no data base is available. Given the
weak domain of background literature and secondary data, this
research is exploratory and based only on the responses of
businesses and consumers in the Republic of Benin.
Like most West African countries, marketing systems in Benin are
of two general types: foreign owned networks (manufacturing and
wholesaling) and individual local businesses (Baker, 1965). The
two systems supply a market divided into 80 percent of a population
that produce basic agricultural products (yams, corn, nuts, cotton
and cacao). When studying the use of advanced marketing tools,
these commodity suppliers in this market segment are not
strategically important consumers. Their exchange practices are
primarily local and consist of bartering. These consumers are
subsistence farmers.
The economically significant consumers in the economy are those
who live in the cities. This segment contains about 20 percent
of the population but the majority of the non-barter purchasing
power. Our research used this urban population as respondents to
questions on the consumer use of promotion. The typical urban
household lives in a rented apartment and owns one or two scouters
(motor scooters), one television set, one stereo radio, relatively
comfortable furniture, and rarely take vacations. This population
has a relatively comfortable life style. These two marketing
systems share a market population with an average income of $2400.
Ninety percent of the foreign companies doing business in Benin are
primarily providers of consumer goods and service. According to
Benin's Ministry of Commerce and Industry, local companies are 76
percent privately owned; 24 percent are government owned or are
mixed, private and government. Whereas government owned businesses
are mainly concentrated in the manufacturing sector, 90 percent of
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the import and export businesses are privately owned. Our study of
business respondents included the private companies involved in
importing and in domestic production of goods and services for the
urban population.
RESEARCH QUESTIONS
Promotion as a marketing mix component stimulates demand and
enhances company image (Evans and Berman 1987). As noted before,
promotion is as vital as the other marketing components of price,
product and distribution. However, depending on country and
corporate factors, the role of promotion and the importance of
each promotional tool may vary (Akaak 1989). The objective of
this study is to investigate the role played by promotion in
Benin, West Africa. Specifically, the following research
questions will be examined:
1. What is the perceived importance of promotion tools
by Benin, West African companies?
2. To what extent are local consumers sensitive to the
promotional messages?
The coverage of these questions implies the formulation of the
following propositions:
P1. The perceived role and importance of promotional tools by
Benin, West African companies is viewed differently by
Benin, West African companies.
In a market environment characterized by the marketing of products
or service with low levels of added value, where most activities
consist of retailing and wholesaling of imported goods, and where
the rate of literacy is less than 20 percent promotional tools are
not generally viewed as determinant factors in the marketing efforts
of companies.
P2. Benin, West African local consumers are less sensitive to
promotion tools than to price, product quality, and service.
Given the fact that Benin consumers' buying power is low and that
they have a relatively low interest in mass media communication,
consumers should pay less attention to promotional messages or
ignore them altogether. Price should be more highly valued in the
decision process.
METHODOLOGY
Local company managers and local consumers, were interviewed for
this study. The interviews were conducted by a group of three
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people: the first author of this paper (an MBA student) and two
assistants, who were seniors majoring in business administration
at a local Benin university. The assistants were trained in the
process of interviewing and collecting data. The consumer data
were gathered in the six major cities that are the capitals of the
six provinces of Benin. Each city has equal access to the major
mass media. The interviews were conducted either in French or in
the local language, depending on the preferred language in the
respondent household. Consumers interviewed live in relatively
comfortable houses or apartments, and were randomly drawn from a
list obtained from the mayor of each region. Of the 300 households
targeted, 193 (64 percent) were interviewed and responded to the
questions.
A total of 200 Benin companies were randomly selected from the
Directory of the Benin Department of Commerce and Industry.
The directory lists all businesses in the country. Corporate
interviews were conducted in Cotonou, Parakou, and Porto-Novo, the
headquarters of most Benin companies. Depending on each company's
organizational structure, either the marketing manager or the
person in charge of promotional activities was interviewed. One
hundred and twenty-six companies of the 200 companies selected
agreed to participate in the interview for a 63 percent response
rate.
Table 1:
Company Profile (126 responding companies)
A. Sector of activity
1. Private 89.7%
2. Public 10.3%
B. Size (Annual Sales)
1. Small (less than $200,000) 18.3%
2. Medium (between $200,000 and $1 million) 35.7%
3. Large (more than $1 million) 46.0%
QUESTIONNAIRE ITEMS
Two categories of questions were asked of company respondents. The
first question category related to the perceived importance of
promotional tools as a marketing mix component and the assessment
of the marketing mix component's effectiveness. Company respondents
were asked to select the importance on a five point scale anchored
by "not important" and "very very important". The effectiveness
scales were anchored with "not effective and very very effective".
Both scales were a Likert type scale.
The second category of company questions focused on the company
respondents' perception of customers' sensitivity to the marketing
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mix component factors of price, quality, promotion, service and
brand. The intention was to determine the companies' perception of
customers' awareness of promotional use. Similarly, a Likert type
scale was used for each factor ranging from "not sensitive" to
"very very sensitive" and used a numerical range of 1 to 5.
Three hundred households were randomly selected and represent the
targeted population. One hundred ninety-three (64 percent) agreed
to be interviewed and responded to the questions. The first set
of consumer questions asked whether the respondent had purchased
any products or service as a result of the exposure to promotion
tools. The second set of consumer questions focused on the way
that local consumers discover or become aware of new products.
Finally, consumers were asked to evaluate the importance of several
marketing components such as price, promotion, quality, brand and
service in their buying decision.
ANALYSIS AND RESULTS
The companies' expectation of perceived importance and
effectiveness of local consumers use of different marketing mix
components were explored. Frequency analysis was used based on
the underlying Likert scales. Cross tabulations were also used
to find a likelihood link between the companies' profile and their
assessment of promotion importance and effectiveness.
Company perceived importance of promotion tools
The content of Table 2 shows that only 4.0 percent of the companies
interviewed responded that promotion tools are not important
whereas 34.1 percent reported they are important and 37.3 percent
rated them very important These results are consistent with the
verbal comments made by many of the respondents. There were not
any significant differences across the several demographic
variables that were measured in the survey; such as company origin,
either domestic or foreign; company sector, private or public;
company profile, industrial, commerce (retailing), or service; or
company size. The mean rate of promotional importance ranged from
3.4 to 3.7 on the five point scale. The exception was the company
profile of services which represented banks and financial
institutions had a mean of importance of 3.1.
Table 2:
Company Perceptions of Promotion
Promotional Promotional
Importance Effectiveness
------------------------------------------------------------------
Not Important-effective 4.0% 8.7%
Somewhat Important-effective 9.5% 19.8%
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Important-effective 34.1% 46.8%
Very Important-effective 37.3% 18.3%
Very Very Important-effective 15.1% 6.3%
------------------------------------------------------------------
Advertising and sales promotion were the dominant promotional tools
used most by companies with about 25 percent each across the
demographic groups, Table 3. The industrial (manufacturing) was
lowest for advertising use as the most important promotional tool,
with 20 percent of the respondents. The domestic companies thought
sales promotion to be much less important, but emphasized personal
selling more than other company groupings.
Table 3 Percentage Responses:
The Importance of Promotional Tools in Company Promotional
Strategies across Company Demographics
Importance | PROFILE | ORIGIN | SECTOR | SIZE |
of |----------------|----------|---------|-------------------|
Promotional|Indu-|Com- |Ser-|Dome-|For-|Pri-|Pub-| | | | |
Tools |stry |merce|vice|stic |eign|vate|lic | 1 | 2 | 3 | all|
----------------------------------------------------------------------
Advertising|20.0 |23.3 |25.0| 23.1|22.9|24.8| 7.7|18.8|18.0|28.3|23.0|
| | | | | | | | | | | |
Sales | | | | | | | | | | | |
Promotion |20.0 |21.1 |31.3| 15.4|33.3|24.8| 0.0|25.0|22.0|21.7|22.2|
| | | | | | | | | | | |
Personal | | | | | | | | | | | |
Selling | 5.0 | 6.7 |12.5| 11.5| 0.0| 8.0| 0.0| 6.3|10.0| 5.0| 7.1|
| | | | | | | | | | | |
Public | | | | | | | | | | | |
Relations |10.0 | 7.8 | 0.0| 7.7| 6.3| 6.2|15.4| 6.3| 6.0| 8.3| 7.1|
| | | | | | | | | | | |
ALL TOOLS |45.0 |41.1 |31.3| 42.3|37.5|36.3|76.9|43.8|44.0|36.7|40.5|
----------------------------------------------------------------------
For most marketing or commercial managers, the usefulness and
importance of promotional tools do not need to be proven.
Marketing's use of promotion is as vital to the Benin companies
as are the other marketing mix components for each organization
structure. Analysis of the cross tabulation value of the
interaction between the companies' profiles and their perceived
importance of promotion did not yield a significant value 0.45 on
Crammer's V measure of dependence. However, it did confirm the
significant effect that Benin company respondents believe promotion
has on Benin consumers. Thirty three percent of companies involved
in import and export business responded that the use of promotion
tools in Benin, West Africa is very important.
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Consumers behavior toward the use of promotion tools.
Contrary to the popular assumption that consumers in developing
countries ignore advertising messages (Mazur, 1994), local
consumers in Benin do pay attention to the use of promotional
tools by companies. As Table 4 shows, 32.1 percent of the
respondents discover new products or services through television
advertising, and 34.2 percent receive advice from friends,
relatives or parents representing an opportunity for managing word
of mouth promotion. Moreover, 72.5 percent of the respondents
said that they have purchased or ordered something due to
promotional tools. Family income does not alter these general
findings. However, when the means of the items that influence
purchases are examined, quality has the greatest influence
followed by price, brand, service, and promotion has the lowest
level of influence. Family income does not alter this ordering.
Table 4
4 Ways of Discovering About Products
1. TV ad 32.1%
2. Radio ad 15.5%
3. Advice 34.2%
4. Shopping/Market 13.5%
5. Magazine/Newspapers 4.1%
6. Billboard .5%
Table 5
Consumer Purchase of Product or Service Because of Promotion
1. Yes 72.5%
2. No 27.5%
Consumers response to the question; Are promotional tools important
in the buying decision? strongly supported the use of promotion.
Promotional tools are used in the buying decision. Thirty-five
percent (highlighted in Table 6) responded that promotional tools
are somewhat important and 35 percent recognized that they are
important. This support for the use of promotional tools must be
tempered with the recognition that consumers value the determinants
brand, price, quality, and service more. Table 7 offers evidence
that other marketing tools were more important irrespective of
income. Quality may be more important as income increases.
Recommendation of others had the greatest impact on becoming aware
of products as noted in Table by over one-third of the consumer
respondents, but television and radio also had a substantial
impact on product awareness. Print media was much less important.
Table 6
Appreciation and Use of Promotion by Consumers
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not imp s/w imp imp very imp v/v imp
------------------------------------------------------------------
Price 4.1 4.7 26.4 43.0 21.8
Promotion 14.5 35.8 35.2 10.9 3.6
Quality .5 5.7 33.2 35.2 24.9
Brand 3.6 17.6 42.5 30.1 6.2
Service 7.8 25.9 36.3 24.4 5.7
------------------------------------------------------------------
Table 7
Importance of Promotional Tools in the Decision Process
by Consumers Across Income Groups
Monthly Family Income $500*
$200 $500
------------------------------------------------------------------
Percent of Respondents 16.1 36.3 45.1 2.6
Brands 3.32 3.39 3.01 3.60
Price 3.45 3.74 3.82 4.00
Promotion 2.71 2.64 2.33 3.40
Quality 3.81 3.82 4.07 4.20
Service 2.94 3.04 2.82 3.80
------------------------------------------------------------------
* The cell size of respondents greater than $500 is too small
(n=4) to be reliable.
CONCLUSION
The results and the analysis support the primary objective of this
study. The gap between the intensity and importance given to the
use of promotional tools in the developed countries and the
developing countries could be explained by country, economic
environment and company size factors. However, it appears that
this gap is closing. Companies in developing countries are aware
of contemporary promotional tools and are using them in promotional
strategies. Consumers are using the promotional tools in their
buying decisions. The use of satellite dish television reception
will continue to bring consumers closer together in the similarity
of buying behavior.
Most of West African companies are relatively small compared to
corporations in developed nations. One of the concerns expressed
by both company managers and local consumers is the quality and the
competitiveness of the promotional tools used in West Africa. Local
businesses and the researcher recognize the lack of reliable,
effective and competitive advertising agencies or other specialized
promotional agencies. One factor that could enhance and cultivate
the usage of promotion tools in West Africa could be the installation
of more professional and reliable agencies in the region. The wide
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spread use of global media and the adoption of global marketing
practices by companies in the developing countries will probably
continue to reduce the disparity between practices in the developed
and developing countries of the world.
RESEARCH LIMITATIONS AND FUTURE RESEARCH
There is no doubt that the present study has not entirely covered
the topic of marketing and promotional use in Benin, a developing
country. It would have been useful if the study had spread its
empirical focus on the effectiveness of the use of promotion in
more countries of West Africa. Additional studies can take this
direction by replicating the same topics with other developing
countries in West Africa or other developing areas. A significant
portion of the population can not read and therefore can not use
self-reporting mail surveys. Interview methods have to be used
which imposes a limit on sample size and breadth of the study.
Research in West Africa is difficult, these exploratory findings
do contribute to a greater knowledge about the use of promotional
tools in developing economies. This research does provide a base-
line of promotional use in developing West African countries that
can be used for future comparison. There has not been any available
information on promotional use in this part of the world.
MANAGERIAL IMPLICATIONS
Companies operating in Benin can use promotional tools effectively
since consumers use the information in their decision process.
However, there are some additional considerations to the use of
promotion. Limited professional infrastructure such as advertising
agencies, direct mail houses, and mail systems restrict the use of
some promotional tactics. However, there is a national commercial
television system owned by the national government. Television and
radio signals are also received from neighboring countries of
Nigeria and Togo. There are sufficient broadcast media available
for mass communication. In the absence of an acceptable professional
advertising infrastructure, the existing broadcast media could
integrate some of the typical advertising agency tasks into its
structure.
Benin, like many other West African countries, has an official
language which is French, but there are several local languages
which have to be considered in mass promotional messages.
Promotional effort can focus on developing symbols, signs or easily
recognized brands to overcome some of the language and literacy
limitations. Despite the limitations, the potential for additional
promotional use is significant in developing countries. From the
study it appears that sales promotion is under used. Print media
also appears to be under used with only 4 percent of the respondents
becoming aware of products by the use of magazines or newspapers.
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As literacy rates increase, print media may become more important
to consumers and to companies. Until literacy rates increase to
acceptable levels making print media economical to use, additional
video kiosks can be used at the point-of-sale and in other
locations that would influence the purchase decision. Again signs
and symbols or icons can be used to assist consumers. The
availability of electronic media and the flexibility that this
media brings to marketing and promotion will continue to have a
substantial impact on the company practices in developing country.
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