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CHAPTER ONE

INTRODUCTION
1.1

Background information

The business environment has become very competitive in the 21st century due to the growth in
technology, infrastructure and access to information around the globe. This has made the
environment very complex and consumer preferences keep changing because of the low
switching cost in the market. Due to this increasing demand of consumers in the market,
management of business organizations have to increase their resources with attention focused
more on attracting and retaining its customers (Kotler, 2003).
The ever increasing competition in the global market has prompted organizations to be
determined and ensure satisfaction of customer needs and wants more efficiently and effectively
than ones competitors (Kotler, 1988).Sales promotion is an initiative undertaken by organizations
to promote and increase sales, usage or trial of a product or services (Aderemi, 2003). Sales
promotion refers to the provision of incentives to customers or to the distribution channel to
stimulate demand for a product. It is an important component of an organizations overall
marketing strategy along with advertising, public relations and personal selling. Sales promotion
acts as a competitive weapon by providing an extra incentive for the target audience to purchase
or support one brand over the other. It is particularly effective in spurring product trials and
unplanned purchases (Aderemi, 2003).
Sales promotion is a marketing activity that adds to the basic value proposition behind a product
(i.e. getting more for less) for a limited time in order to stimulate consumer purchasing, selling
effectiveness or the effort of the sales force (Aderemi, 2003). Thisimplies that, sales promotion
may be directed either at end consumer or at selling intermediaries such as retailers or sales
crews.
Sales promotion can be an effective tool in a highly competitive market, when the objective is to
convince retailers to carry a new product or influence consumers to select it over those of
competitors. More so, sales promotion tend to work best when it is applied to items whose
features can be judged at the point of purchase, rather than more complex, expensive items that

might require hands of demonstration (Kotler and Keller, 2006). Sales promotion includes
communication activities that provide extra value or incentives to ultimate customers,
wholesalers, retailers or other organizational customers. It also stimulates sales product trial
(Kotler and Keller, 2006).
However, according to Keller (2003), consumer buying behavior is the process by which the
individual search for, selects, purchase, use and dispose of goods and services, in satisfaction of
their needs and wants. The consumers behavior has a direct effect on the success of the firm and
therefore must ensure that they create a marketing mix that satisfies consumers. The consumer
mostly goes through about five steps in taking one purchase decision. These include Problem
recognition, Information search, Evaluating of alternatives, Purchase decisions, Purchase and
Post Purchase evaluation. Actual purchasing is only one stageof the process and not all decision
processes lead to a purchase. Also not all consumer decisions will include all the stages but will
depend on the degree of complexity and risk involved.
There are however about four types of buying behaviors that consumers exhibit; these include a
routine response which needs very little search and used when purchasing frequently purchased
item, limited decisions which is used when purchasing low priced brands in a familiar product
category, extensive decision which has a high degree of economic, performance and
psychological risk which demands lot of time in seeking information and deciding and impulse
buying which is spontaneous and needs no conscious planning.
This study focuses on the effects of sales promotion on consumer buying behavior. The ultimate
objective of every business is to increase the sale of goods that it deals in. Several methods can
be adopted for the achievement of this goal; some direct while others indirect. Sales promotion is
one of them. Sales promotion is defined as a diverse collection of incentive tools, mostly, short
term designed to stimulate quicker and/or greater purchase of particular products/services by
consumers (Kotler, 1998).
According to Kotler (2003), Sales Promotion is a key ingredient in marketing campaigns and
consists of a diverse collection of incentive tools, mostly short term designed to stimulate
quicker or greater purchase particular products or services by consumers. Sales promotions
programmes are those activities other than stimulate consumer purchase.

Sales promotion is one of the four aspects of promotional mix which is an element of the four
marketing mix: product, price, promotion and distribution. It is normally considered as a tool
consisting of short term incentives to encourage the purchase or sale of a product or service
Examples of sales promotion are found everywhere e.g. In the aisle display in the local
supermarket that tempts impulse buyers with a wall of coke cartons, an executive who buys a
new Compaq laptop computer gets a free carrying case. Sales promotion includes a wide variety
of promotion tools designed to stimulate earlier or stronger market response (Kotler 2003).
The case study is Oriflame Natural Swedish Cosmetics Company which was founded in the year
1967 in Stockholm Sweden, by Robert Jochnik and Jonas Jochnik, the name Oriflamme
describes a beautiful Swedish woman and thus the two were inspired by the natural beauty of a
Swedish woman. Oriflame has branches in over 62 countries and has approximately 3.3 million
consultant and over 7,500 employees globally. It launched its operations in Kenya in the year
2003 with its headquarters in Nairobi though it has over 50 branches all over the country.
So far the company is using some sales promotion techniques like the free samples where they
give the sales consultants free samples of assorted creams also free trial sales promotion tool
where they have most of their products on display in their TSS office where potential customers
can sample for free. Currently they lounged the prize off where the prizes of the products have
been reduced to 40%.
The free samples are mainly directed to the sales consultants who in most cases, is hard to know
if they extend the free samples to their customers or not, Secondly the free trial products are in
one point office at the TSS Towers where it is hidden from human traffic so it becomes hard to
communicate to the passerbys or onlookers.
The study seeks to find out the effects of these sales promotion tools, bearing the given demerits
above, and also to see if Oriflame can implement better sales promotion techniques especially
directly to consumers. The company sells its products through an independent sales force outside
the traditional retail environment and it has worked in the 62 countries that it is operating in.
Oriflamme has a wide range of over 340 different cosmetic products namely: Skin Care, Color
Cosmetics, Fragrances, Personal & Hair Care, Accessories and Wellness. This varied range of

cosmetics needs intense sales promotion to ensure that that the products sell and more so to
achieve its main goal which is To become the worlds leading sales cosmetics Company
1.2 Statement of the problem
Oriflamme natural cosmetic product company needs to provide offerings or services that satisfy
consumer needs and expectations to ensure the companys economic survival. In order to achieve
this feat, they need to understand consumer buying behavior to help them evaluate their service
offerings.
Consumers go through a cycle of decision making processes before making a purchase decision
which define their behavior in the consumption of the products they purchase from these
companies. The consumer buying process is a complex matter as many internal and external
factors impact on the buying decision of the consumer (Aderemi, 2003).
The consumer makes a purchase decision by examining alternatives before making the purchase.
Sometimes, the purchase may differ from the purchase decision reached earlier. There is always
a post purchase evaluation by the consumers after purchasing and consumption of the service.
Specific factors that may lead to altered consumer buying behavior are size and composition of
the evoked set of alternatives, perceived risk, brand loyalty and attribution of dissatisfaction. The
consumer determines whether he was satisfied or not with the services rendered. This actually
will be an important information reference point to the consumer in determining their behavior in
the next purchase (Kotler, 1996).
Oriflame employs the use of some sales promotion tools like; free trial, where they invite
prospect customers to try the products without cost. This method is ideal for products like
fragrances and make-ups since the results are immediate, but this technique is not very effective
for items like; acne fighting products or skin repair products which usually takes longer period
for the results to be seen. Another tool is the use of free samples of assorted creams and
fragrances, which is a technique only directed to the sales consultants who have accounts to
purchase the products and sell at a profit to the customers.
Most of Oriflame Sales promotion is usually directed to the sales consultants, it would be more
effective if they implement better sales promotion tools that will be directed towards the

consumers, since they are the end users of their products. And even if they use sales promotion
tools to the consultants they should strategize them in a way that it will be effective on the
general sales.
This study, therefore, sought to determine the effects of sales promotion on consumer buying
behavior at Oriflame Natural Cosmetic Products Company Ltd in Mombasa.
1.3 Objectives of the study
General Objective
The general objective of this study was to assess the effect of sales promotion on consumer
buying behavior.
Specific objectives
1. To establish sales promotional tools used by Oriflamme.
2. To identify sales promotion strategies practiced by Oriflamme.
3. To find out the factors that promotes or impairs the effectiveness of sales promotion.
1.4

Research Questions

The following are the research questions:


1. What are the sales promotional tools used by Oriflame?
2. What are the sales promotions strategies practiced by Oriflame?
3. What are the factors that promote or impair the effectiveness of sales promotion?
1.5

Justification

The research will have significance to the following different parties;

1.5.1

The researcher

Academically, the study will enlighten the researcher more on the influence of sales promotion
on consumer buying behavior, thus being a good marketer.
1.5.2

Jomo Kenyatta University of Agriculture & Technology

The research will be ideal to JKUAT since the students of the institution who are intending to do
research on sales promotion will access required information.
1.5.3

Oriflamme Swedish Natural Cosmetics

This intensive research will highlight on promotion tools and techniques and also recommend on
the ideal techniques to be employed by the company. The company can also use this research to
know the merits and demerits of each promotional technique and unify these in order to achieve
their goals.
1.6

Scope of the study.

The study was carried out at Oriflame main office in Coast Region Headquarters which is located
along Nkrumah road at TSS building 1st floor to study the effects of sales promotion in relation
to consumer buying behavior. For the purpose of this study, the organizations employees were
divided into six different departments.
1.7

Limitations of the study

The following are the limitations that the researcher encountered while carrying out the study;
1.7.1

Time constraint

Time allocated for this study was not adequate and at best stressful. This is because the
researcher had seven other units to handle, a full time job, family and social commitments. This
limitation was, however, overcome by proper planning. The lecturers were also very supportive
and understanding and this made it easier to manage everything.

1.7.2

Confidentiality

There were some respondents who feared sharing out information for fear of being reprimanded
by their managers for giving out information that they may have considered confidential.
However, the researcher assured the respondents of the confidentiality of the information that
they provided. The researcher also obtained permission from the management of Oriflame to
undertake the research in the organization.

CHAPTER TWO
LITERATURE REVIEW
2.0

Introduction

This chapter provides a review of the existing literatures on the effect of sales promotion on
consumer buying behavior. The main sections included therein are: theoretical framework,
conceptual framework, critique of existing literature relevant to the study, summary and research
gaps.
2.1

Theoretical Review

2.1.1

Sales Promotion Theory

Sales promotion is giving the customer something extra, rewarding them for their behavior on
this particular purchasing occasion. There are several theories which support the concept of
reward as a motivator. The conditions of sales promotion are classical and operant conditioning.
Whereas classical conditioning is largely associated with advertising, operant conditioning is
seen as an explanation for consumer behavior in relation to sales promotion. Operant
conditioning suggests the response of the individual is likely to be affected by positive
reinforcement (reward).
Negative reinforcement (punishment) the affect is likely to cease when the reinforcements are
taken away. Edward Thorndike suggested that the law of effect, which had to do with positive
and negative consequences of actions, is also relevant to sales promotion. The law states that the
consequences of behavior now will govern the consequences of that behavior in the future. In
other words once a buying pattern is achieved it will continue into the future. John Watson, US
psychologist and founding father of American behaviouralism, introduced the concept of
shaping, chaining, and priming.
Shaping: John Watson states shaping suggests that a final response can be explained as
appearing after preceding acts which; taken together, constitute a chain of successive

approximations. Shaping breaks the desired behaviors in a series of stages and the parts are
learnt in sequence.
Chaining: Chaining suggests behavior emerges from sequences of actions in which the
preceding action becomes the discriminative stimulus for the final response (inducement >
purchase).
Priming: De Pelsmacker (2001) states, priming suggests that a short exposure to a particular
stimulus can evoke an increased drive to consume more of a product. So this all theories offer
reasons why we can motivate people to buy more by offering incentives although the
continuation of these behaviors is open to doubt.
Pull Theory
The Pull Theory is about trying to market directly to customers to increase their demand for your
product. Advertising and tie-ins with other products or services is the key to this strategy. The
theory goes that if you increase the demand for your product by consumers, they will in turn
demand the product from retailers, retailers will demand more of your product from wholesalers
and wholesalers will demand more products from you. This is a way to increase your sales
without decreasing the sale value of your merchandise. Most of the costs are in advertising, so
using a tie-in with a related product or service can disperse this cost across both companies.
Push Theory
Using the Push Theory, you can increase sales by creating incentives to wholesalers or retailers
to sell more of your product. In this method you would offer discounts to wholesalers or retailers
who buy your product in bulk. This leaves them with more of your merchandise on hand and
drives them to sell more of your product. Giving them the discount "pushes" them to buy more of
your product at a lower price to increase the amount of money they make. In turn they must
"push" your products to customers because they will make a better return on them than on
similar products supplied to them by your competitors.

Combination Theory
This theory requires both of the above theories working together. The "push" is used to get more
products into the hands of retailers and wholesalers while advertising and product tie-ins with
other products are used as a "pull" to get more people to want to buy the product.
2.2 Conceptual framework
Independent Variable

Dependent Variable

SALES
PROMOTIO
N TOOLS
CONSUMER BUYING
BEHAVIOR

SALES
PROMOTIO
N
SALES
PROMOTIO
N FACTORS

Source: Author (2013)


Fig 2.1: Relationship between variables
2.2.1

Sales Promotion Tools

Promotion according to Doyle and Saunders (1985) is most important in changing the timing
rather than the level of purchasing because customers tend to buy earlier. Promotion is a
marketing effort by any organization in trying to communicate to its customers. According to
Kotler (1994), a good promotional strategy should encompass sales promotion, public relations,
advertising and personal selling in order to communicate with their present and potential
consumers. Promotion is responsible for moving the demand curve upward and to the right by
utilizing some or all of the elements of the promotional mix.

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Again, Pride and Ferrel (1989) also grouped sales promotion methodsinto two. Consumer sales
promotional methods are directed towards consumers and they include coupons, contests,
bonuses, vacations, shopping, gifts, free products and services, and free samples. Trade sales
promotion methods focus on wholesalers, retailers and sales person. This includes sales contests,
free merchandise, demonstrations, point-of purchase and displays (Pride and Ferrel, 1989). The
purpose of sales promotion in the marketing mix in marketing events is to have a direct impact
on the behavior of the firms consumers. Several authors have identified different categories of
consumer- oriented sales promotion. According to the International Chamber of Commerce,
International Code of sales promotion practices, consumer oriented sales promotion
encompasses the following tools:
Free samples: These are distributed to attract consumers to try out a new product and thereby
create new customers (Kotler, 2003). Some businessmen distribute samples among selected
persons in order to popularize the product common examples - shampoo, washing powder etc.
Sampling which by definition includes any method used to deliver an actual or trial size product
to consumers. Sampling is generally considered the most effective way of generating trial,
though it is the most expensive
Bonus offer or points: This is a reward given to the existing customers (Smith and Schultz,
2005). This tool will help increase the sales of the product among the existing customers itself. A
toothbrush with 500 grams of toothpaste might be some examples of this tool. A certain retail
shops will have a scheme which will require the customer to be a member of the shop and to
acquire membership card for the same. And every time the customer makes a purchase bonus
points are added to the card and at the end of the year gifts are given for the points earned.
Exchange schemes: According to Belch (1998), it refers to offering exchange of old product for
a new product at a price less than the original price of the product. This is useful for drawing
attention to product improvement.
Price-off offer: Under this offer, products are sold at a price lower than the original price. This
type of scheme is designed to boost up sales in off-season and sometimes while introducing a
new product in the market. Price- off is a reduction in a brands regular price (Kotler, 2003). The

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major reason for marketers to use the price-off reduction is that this type of deal usually presents
a readily apparent value to consumers especially when they reference price point for the brand,
therefore they can recognize the value of the discount.
Coupons: A coupon is a promotional devise that provides cent-offs savings to consumers upon
redeeming the coupon (Kotler and Keller, 2006). Coupons can be disseminated to consumers
through newspapers, sales point, and radio stations among others. The organization could
organize a raffle, competition or decide to reward loyal customers with coupons to get more of
their products or any other product the organization will decide. Coupons are issued by
manufacturers either in the packet of a product or through an advertisement printed in the
newspaper or magazine or through mail. These coupons can be presented to the retailer while
buying the product. The holder of the coupon gets the product at a discount.
Premium is also another technique identified by the International Chamber of Commerce as a
standard sales promotion technique. A premium is an offer of merchandise or services either free
or at a low price that is used as an extra incentive for buyers (Belch et al, 1995). The three types
of premium offers identified are free in the mail premiums, in and on pack premiums and self
-liquidating premiums.
Refunds and Rebates also refer to the practice by which manufacturers give cash discounts or
reimbursements to consumers who submit proofs of purchase .Mostly the two sales promotional
techniques provides users a delayed rather than an immediate value since the consumer has to
wait to receive the reimbursement after consuming the service or products .This is evident in the
Contest and Sweepstakes offer consumers the chance to win cash, merchandise or travel prizes.
A contest is a promotion technique where consumers compete for prizes or money (Adcock,
Halborg and Ross, 2001).
Fairs and Exhibitions: Fairs and exhibitions may be organized at local, regional, national or
international level to introduce new products, demonstrate the products and to explain special
features and usefulness of the products. Apart from this small stalls are also placed in popular
locations where the products are sold in smaller quantity to attract more customers.

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Money Back offer and Scratch & win offer: Under this scheme customers are given assurance
that full value of the product will be returned to them if they are not satisfied after using the
product. To induce the customer to buy a particular product scratch and win scheme is also
offered. Under this scheme a customer scratch a specific marked area on the package of the
product and gets the benefit according to the message written there.
Bonus Pack is extra quantities of a product that a company offers to consumers at the regular
price by providing larger containers or extra units (Cravens, 2000). Bonus packs results in a
lower cost per unit for consumers and provides extra value as well as more products for the
amount of money paid. This creates confidence among the customers with regard to the quality
of the product. This technique is particularly useful while introducing new products in the
market.
2.2.2

Sales Promotion Strategies

Push strategy: push strategy involves convincing trade intermediary channel members to "push"
the product through the distribution channels to the ultimate consumer via promotions and
personal selling efforts (Schiffman and Kanuk, 2007). The company promotes the product
through a reseller who in turn promotes it to yet another reseller or the final consumer. Tradepromotion objectives are to persuade retailers or wholesalers to carry a brand, give a brand shelf
space, promote a brand in advertising, and/or push a brand to final consumers. Typical tactics
employed in push strategy are: allowances, buy-back guarantees, free trials, contests, specialty
advertising items, discounts, displays, and premiums.
Pull strategy attempts to get consumers to "pull" the product from the manufacturer through the
marketing channel. The company focuses its marketing communications efforts on consumers in
the hope that it stimulates interest and demand for the product at the end-user level. This strategy
is often employed if distributors are reluctant to carry a product because it gets as many
consumers as possible to go to retail outlets and request the product, thus pulling it through the
channel (Schiffman and Kanuk, 2007).Consumer-promotion objectives are to entice consumers
to try a new product, lure customers away from competitors products, get consumers to "load
up" on a mature product, hold & reward loyal customers, and build consumer relationships.

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Typical tactics employed in pull strategy are: samples, coupons, cash refunds and rebates,
premiums, advertising specialties, loyalty programs/patronage rewards, contests, sweepstakes,
games, and point-of-purchase (POP) displays.

Combination strategy: This strategy requires both of the above strategies working together. The
"push" is used to get more products into the hands of retailers and wholesalers while advertising
and product tie-ins with other products are used as a "pull" to get more people to want to buy the
product(Schiffman and Kanuk, 2007)..
2.2.3

Factors influencing sales promotion

According to Kotler (2003), Sales Promotion is a key ingredient in marketing campaigns and
consists of a diverse collection of incentive tools, mostly short term designed to stimulate
quicker or greater purchase particular products or services by consumers. Sales promotions
programmes are those activities other than stimulate consumer purchase.
The concept of sales promotion consists of diverse collection of incentive tools, mostly short
term designed to stimulate quicker and/ or greater purchase of a particular product by consumers
or the trade. It always offers an incentive to buy a product or service (Smith and Schultz,
2005).Sales promotion efforts are directed at final consumers and designed to motivate, persuade
and remind them of the goods and receives that are offered. There are therefore several reasons
why firms are compelled to roll out sales promotional packages for its customers and potential
customers.
Customers have become more price sensitive because of the increasing cost of living. The
economic recession is likely to fuel this trend further, as consumers and dealers become more
sensitive towards prices. Price offs or discounts for example discourage brand switching by users
and new product launch by competitors (Smith and Schultz, 2005). Timely sales promotion
according to them can keep consumers from trying new brands or keep the wind out of a
competitors grand opening. Smith et al, (2005) however attributes the rationale for price offs to
what they called trial. According to them, motivating consumers to try products or switch is

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crucial to conversion. For instance, consumers have become expectant of the purchase incentives
and always look out for firms who will offer such benefits.
Services and products standardization in the global market has also given rise to the increasing
use of sales promotion in reaching out to its consumers and potential consumers. Brands and
services especially in the telecom industry have been perceived by consumers to be more or less
similar within a given price range due to firms inability to really differentiate its products. In
view of this problem, the other promotional mixes are not able to influence the consumers
perceptions and create brand franchise. As a result of these perceptions of similarity among
brands, firms have no option than to compete with other competitors on the basis of the extra
benefit offered through sales promotion.
Pressure from competitors and increased competition has also given rise to the need for sales
promotion in recent times. The increased competition has left companies to differentiate their
services and product on price and not the other features of the service or product. For instance if
competitors offer price reduction, contest or other incentives, a firm may feel obliged to also
come out with its own sales promotion for consumers to benefit from the service lest they face
out of the competition. All these rationale of sales promotion, though unique from each other, has
a long term effect on increasing the firms market share, improve sales volume, retain customers
and reduce switching of customers.
Adcock et al, (2001) assesses that when a purchase decision is made, the purchase decision can
be affected by unanticipated situational factors. Some of these factors according to them could be
directly associated with the purchase, for instance the outlet where the purchase is to be made,
the quality to be bought, when and how to pay. Most instances, firms remove the need to make
this decision by either including the essentials in the form of sales promotion tools like coupons,
discounts, rebates and samples. The additional benefit whether in cash or in kind offered to
consumers through sales promotion is highly likely to influence their purchase behavior or
decision (Ngolanya,2006). After considering the possible options, the consumer makes a
purchase decision and the consumers choice depends in part on the reason for the purchase
(Kotler et al, 2003).

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2.2.4 Dependent Variable (Consumer buying behavior)


Kotler (2006) mentioned that the market for any product category is made up of consumers who
differ in their responsiveness to deals. Some consumers are loyal to a single brand in a category
and buy only that brand. These on-and off-deal consumers fall into two general categories,
loyalists and switchers. Loyalists are consumers whose purchase patterns reflect that they buy the
same brand over and over when no brands are on deal (when the category is off promotion).
Switchers are the consumers who even when all brands in a category are off promotion
nonetheless switch among different brands. Kotler (2003) refers that consumers have varying
degrees of loyalty to specific brands stores, and other entities. Aderemi (1975) stated that Brand
switching means that a consumer is induced to purchase a brand other than the one that would
have been purchased had the promotion not been available. Purchase acceleration Purchase
acceleration means that a consumers purchase timing or purchase quantity is influenced by
promotion activities.
2.3Critique of the existing literature
Abdallat, M. and El-Emam, M. (2001) argue that sales promotion do not have impact on brand
loyalty and brand equity. According to them even if the product or service is of good quality and
the competitor present better products or services and better support services for the product
among others, sales promotion will lead to little result (Sam and Buabeng, 2011). Again they
argue that, if the product or service is generic, sales promotion is not likely to make much impact
on brand loyalty and brand equity. Sales promotion connects the consumer with the company by
prompting them for some actions. The consumer develops the brand loyalty over a period of
repetitive buying, thus one can make a reasonable speculation that sales promotion has a direct
influence on consumer buying behavior (Sam and Buabeng, 2011).
2.4

Summary

The business world today is a world of competition. A business cannot survive if its products do
not sell in the market. Thus, sales promotion has to be undertaken to increase sales.From these
literatures, sales promotion can help you provide information to potential customers that aid
them in making a decision. This can be beneficial for products or services that are complicated or
are unfamiliar to consumers. It is realized that price plays a crucial role in the consumers

16

decision to purchase a product or services. This implies that, consumers would only choose a
product that offers the best price (Aderemi, 2003). This therefore can influence their decision to
purchase a particular service or product from a company.
Sales promotion attracts new buyers; the new buyers are encouraged to buy the product by the
extra benefits offered by the organization in buying the product. Sales promotion is very useful
when introducing new product in the market, the consumers normally do not know about the new
product so in order to educate the consumers about new product the various sales promotion
tools such as sample distribution, product demonstration, participation in trade fair e.t.c can be
used (Kotler and Keller, 2006).Sales promotion encourages the existing customers to buy and use
more product than usual. Customers normally buy the additional products during promotion
period so as to take advantage of sales promotion activities.
2.5 Research gaps
Some researchers argue that sales promotion do not have impact on brand loyalty and consumer
buying behavior. According to them even if the product or service is of good quality and the
competitor present better products or services and better support services for the product among
others, sales promotion will lead to little result (Abdallat, M. and El-Emam, M, 2001; Sam and
Buabeng, 2011). Again they argue that, if the product or service is generic, sales promotion is not
likely to make much impact on brand loyalty and brand equity.
From previous literature review, it is found that there is a big gap in the research. Mainly, the
researchers did not highlight the influence of sales promotion on consumer buying behavior.
Most researchers concentrated on the broader aspect of promotion mix on various organizations
and none of the research targeted the specific of sales promotion tools on consumer buying
behavior. This research study, therefore, intended to investigate the relationship between sales
promotion and consumer buying behavior.

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CHAPTER THREE
RESEARCH DESIGN AND METHODOLOGY
3.1

Research design

The study involved descriptive research design. The purpose of descriptive research design is to
describe the state of affairs as it exists. The research technique is the most appropriate when the
purpose of the study is to explore and create a detail description of a phenomenon .Thus making
it suitable for this study because the researcher was fairly knowledgeable about the aspects of the
phenomenon, but little was known regarding their nature. The descriptive research design
formulates the problem for more precise investigation and in this case was to explore the effects
of sales promotion on consumer buying behavior (Kothari, 2008).
3.2

Population

The target population is the area of the study that the researcher studied. The target population
for this study comprised of 20 employees from Oriflamme Swedish Natural Cosmetics Product
Ltd in Mombasa.
Table 3.1 Target population
Departments
Marketing
R&D
Management
Purchasing
Deposits
Finance
Total

Target population
15
12
6
10
8
9
60

Source: Oriflamme (2013)

3.3

Sampling frame

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Percentage%
25
20
10
17
13
15
100%

Mugenda (2008) argues that where the number of the population of interest is big and not
possible to access it wholly, a sample should be taken so that every member of the population has
an equal chance of being selected. The researcher used a sample size of 20 representing (33.3%)
of target population. This was obtained from the different departments in the Company as
illustrated in the table below;
Table 3.2: Employees Sample procedure
DEPARTMENTS

POPULATION

RATIO

SAMPLE

Marketing

15

0.3

R&D

12

0.3

Management

0.3

Purchasing

10

0.3

Deposits

0.3

Finance

0.3

TOTAL

60

1.8

20

Source: Author (2013)


From the above table, the sample size was 20 out of a population of 60 employees which
translated to 33.3% of the entire population as explained in the table above.
Sample size =Sample x 100 =33.3%
Population
3.4 The sample and sampling technique

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The general goal of the sampling method is to obtain a sample that is representation of the target
population. In a simple random sample of a given size, all such subsets of the frame are given an
equal probability. Each element of the frame, thus, has an equal probability of selection
(Mugenda, 2003). In order to collect primary data the questionnaire survey technique were used
and the type of sampling used was simple random sampling.
3.5 Data Collection Instruments
Mugenda (2003) states that data collection is gathering of empirical evidence in order to gain
new insight about a situation and answer questions that prompted the undertaking of the
research. For the purpose of this research and in order to achieve the objectives of the study, both
primary and secondary data was collected. The secondary data contributes towards formation of
background information in order to constructively build the research project. Primary data was
collected by use of questionnaires. Kothari (2008) defines a questionnaire as a self-report
instrument used for gathering information about variables of interest to an investigation. The
researcher also used questionnaires to obtain data from the respondents.
3.6

Data collection procedure

The researcher used the following method of data collection:


3.6.1

Questionnaires

The questionnaires were developed and hand delivered to the respondents in their respective
departments by the help of managers. The questionnaires were formulated to address the study
subject which they were then collected back by the researcher after two weeks upon which the
researcher acted on the information collected to come up with findings.

3.7

Pilot test

Prior to the implementation of an activity in a community it is common to collect baseline


information using a pre-test (Mugenda, 2003). Such a survey brings to the light the weaknesses if

20

any, of the questionnaire and also of the survey techniques (Kothari, 2008). This would be
therefore, call for an improvement in the tools to be used. A questionnaire was used to measure
the validity and valuability of the questionnaire.
3.8 Data processing and analysis
The research data collected through questionnaires was analyzed both quantitatively and
qualitatively and presented by use of tables and pie charts where necessary which helped in
understanding the reports.

CHAPTER FOUR
RESEARCH FINDINGS AND DISCUSSION

21

4.1 Introduction
This chapter presents data findings collected from Oriflame company in Mombasa county and
the analysis of that data to ascertain the effects of sales promotion on consumer buying
behaviour. The findings are presented in both qualitative and quantitative techniques by use of
figures and tables.
4.2 Response rate
Questionnaires were administered to fifty (20) employees of Oriflame in Mombasa.
Fiq 4.1: A pie chart illustrating the percentage of males and females who answered the
questionnaire

Gender

MALE
FEMALE

Out of a total of 20 respondents 8 which represent 40% of the sampled size were male and the
other 12 which represents 60% were female.
Fig 4.2: A pie chart illustrating the age distribution of respondents

22

Age Distribution

Under 20 yrs
21-30
31-40
41-50
51 and above

From Fiq 4.2 it can be observed that most of the respondents are between 31 and 40 years. 10 out
of 20 respondents belong to this group. This represents 50% of the sampled population. It can
also be noted from the chart that 5% of the respondents are below the age of 20 and 5% are
above the age of 50. This indicates that majority of the Oriflame employees are youths.

Fiq 4.3: A bar chart showing the time the respondent has worked with Oriflame.

23

Duration with Oriflame


12
10
8
6
4
2
0
0-1 yrs

1-3 yrs

3-5 yrs

5-7 yrs

7-10 yrs

10 and above

1 respondent representing 5% of the sampled population have worked with Oriflame for less than
a year, 3 representing 15% have been with Oriflame for between 1 to 3 years, 10 representing
50% have been with Oriflame for between 3 to 5 years and 3 respondents representing 15% of
the sample population have been with Oriflame for between 5 to 7 years while 2 representing
10% of the population have been with Oriflame for the period between 7 to 10 years and 1
representing 5% of the sampled population have worked with Oriflame for more than 10 years.

Fiq 4.4: A bar chart illustrating the departments the respondents belong.

24

Respondents department
6
5
4
3

Respondents department

2
1
0

From Fig 4.4 it can be observed that 5 representing 25% of the respondents work in Marketing
department followed by Deposits and Operations department with 4 representing 20% of the
sampled population respectively. The Purchasing department has 3 representing 15% of the
respondents followed by Finance department which has 2 respondents representing 10%. R&D
department also has 3 respondents representing 15% of the sampled population.

Fig 4.5: A bar chart depicting chances of recommending promotional tools used by Oriflame.

25

Rating promotional tools in use


10
9
8
7
Rating promotional tools in
use

6
5
4
3
2
1
0
Coupons

Samples

Premiums

Price packs

9 respondents representing 45% of the sampled population favoured coupons as a promotional


tool, 5 representing 25% were for Samples, while 2 representing 10% chose Premiums and
finally 4 respondents representing 20% were for Price packs.

Fig. 4.6: A bar chart illustrating the preference of Oriflame promotional tools by the respondents.

26

Preference of the current promotional tools


7
6
5
4

Preference of the current


promotional tools

3
2
1
0

According to Fig. 4.6, 1 representing 5% of the respondents have an excellent view of the
promotional tools applied by Oriflame, 3 representing 15% of respondents feel that the
promotional tools used by Oriflame are very good, 6 representing 30% believe they are good
while 5 representing 25% of respondents feel they are fair, while 2 representing 10% of
respondents believe those promotional tools are poor and 3 representing 15% of respondents are
indifferent of the promotional tools in use.

Fiq 4.7: A combination bar chart illustrating how respondents rate the factors enhancing effective
sales promotion.

27

12
10
8
6
4
2

Extremely Satisfied

Satisfied
Indifferent
Dissatisfied

For Size of incentive, 4 respondents representing 20% of the sampled population are extremely
satisfied, 9 representing 45% are satisfied, 6 representing 30% are indifferent, 1 representing 5%
are dissatisfied.
For Promotion and distribution decisions, 10 respondents representing 50% of the sampled
population are extremely satisfied, 7 representing 35% are satisfied, 3 representing 15% are
indifferent and none of the respondents are dissatisfied.
For length of information, 4 of the respondents representing 20% of the sampled population are
extremely satisfied, 7 representing 35% are satisfied, 9 representing 45% are indifferent and 3
representing 15% are dissatisfied.
For evaluation of overall sales programs, 7 respondents representing 35% of the sampled
population are extremely satisfied, 8 representing 40% are satisfied, 5 representing 25% are
indifferent and none is dissatisfied.

Fig 4.8: A bar chart illustrating the Oriflame overall relationship with customers given its sales
promotion strategies.

28

Relationship with customers


12
10
8

Relationship with
customers

6
4
2
0
Excellent

Very good

Good

Indifferent

Poor

5 representing 25% of the respondents have an excellent perception on Oriflames relationship


with its customers based on its promotion strategies, 4 representing 20% of respondents have a
very good perception, 10 representing 50% have a good perception while 1 representing 5% of
respondents have a fair perception and none has poor perception.

Fig 4.9: A combination bar chart illustrating factors enhancing sales promotion practice in
Oriflame.

29

16
14
12
10
8
6
4
2
0

No extent
Small extent
Some extent
Large extent
Very large extent

On Appearance of sales person, 4 respondents representing 20% of the sampled population


believe this factor enhances sales promotion to small extent, 6 representing 30% to some extent,
10 representing 50% to large extent.
For Attachment services offered, 2 respondents representing 10% of the sampled population
believe this factor does not enhance sales promotion, 4 representing 20% to small extent, 6
representing 30% to some extent and 8 representing 40% to large extent.
On display of products at the outlets, 7 of the respondents representing 35% of the sampled
population believe no extent, 9 representing 45% to small extent, 4 representing 20% to some
extent.
For Free samples offered, 5 respondents representing 25% of the sampled population hold to
some extent that it enhances sales promotion, 15 representing 75% to large extent.
For short term price reduction, 1 respondent representing 5% hold that this factor enhances sales
promotion to small extent, 12 respondents representing 60% to some extent and 7 respondents
representing 35% to large extent.

30

CHAPTER FIVE
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

31

5.1 INTRODUCTION
This chapter gleans on the outcome of the analysis from the statistics gathered in chapter four.
The researcher made summary, conclusions and recommendations from the findings of the
research study.
5.2 SUMMARY
Below are the findings of the research as gleaned from the analyses; Sales promotion practice is
a very prominent feature in the every industry and consumers are very much aware of the various
sales promotional strategies practiced by these industries. The sales promotion practice in the
industry draw these consumers to the product and make them do impulse purchase. This
confirms the assertion by Ngolanya, et al, (2006) that sales promotion engenders impulse buying.
Factors such as appearance of sales persons, displays of products, free gifts accompanied with
the purchase of products, free samples offered for customer trial and short term reduction of
prices on certain occasion could enhance or impair the effectiveness of sales promotion. The
findings confirmed that, amidst the factors that could enhance the effectiveness of sales
promotion practice, the factor that has the greatest effect was the free samples offered. This
supports the study done by Adcock (2001), who asserts that when a purchase decision is made,
the actual purchase can be affected by unanticipated situational factors. Some of these situational
factors according to them could be directly associated with the purchase, for example the outlet
where the purchase is to be made, the quality to be bought, and payment procedure among
others. The employers also had similar views that these free samples offered enhance the
effectiveness of sales promotion.
There was a significant influence of sales promotion on consumer behaviour. Implying an
improvement in the sales promotion strategies will lead to a corresponding improvement in
consumer buying behaviour towards purchasing Oriflame products. This supports the study by
Sam and Buabeng (2011), which states that, the essence of sales promotion is to provide a direct
inducement to act by providing extra worth over and above what is built into the product at its
normal price. Sales promotion plays a significant role in influencing the consumer decision
process by shortening the decision process during purchase.

32

The results also indicate that majority of respondents found Oriflame to have good customer
relationship due to its sales promotion strategies.
Above fifty-five percent (55%) of the respondents are satisfied with the promotion and
distribution decisions as a factor which enhances effective sales promotion. This is followed by
evaluation of overall sales programs which greatly influences consumer buying behavior.
5.3 CONCLUSION
Cosmetic dealers have a lot of services and products that they make available to consumers
through their various communication tools. One of the key promotional tools used in marketing
these services and products is sales promotion.
In conclusion, Oriflame employees are generally satisfied with the companys sales promotion
strategies which in turn influences consumer buying behavior as this research sought to establish.
However this satisfaction seems to have an effect on the number of clients who are willing to
repurchase Oriflame products. In effect, the more sales promotion strategies are customer
friendly, the more it is capable of influencing those customers buying behavior.
The study revealed that sales promotion has an influence in the purchase decision of consumers.
It was realised that the consumer may not go through the entire decision making process anytime
they want to purchase a service or product. This may be so because the evoked sets which
present the consumer with established alternatives may inform the consumers judgements in
deciding which service or product to buy. This may eventually prevent the consumer from going
through all the stages of decision making because of experience and available information to
him. Sales promotion therefore is an inevitable promotional tool for firms if they really want to
maintain or increase their market share.

5.4 RECOMMENDATIONS

33

Recommendations have been made about measures that could be taken to improve the practice of
sales promotion at Oriflame and beyond in order to influence the consumer buying behaviour
effectively. The following may be noted:
The firm must intensify the use of sales promotion as respondents have shown great interest and
are highly influenced by sales promotion activities.
Appearance of sales person should be greatly enhanced. Therefore it may be used in conjunction
with other promotional tools such as coupons and free talk time. Greater emphasis may be placed
on attachment services to gain maximum advantage.
Sales promotion has short term effect, as a result services providers need to do a continuous
follow up to establish long term relationship with new customers acquired during sales
promotion period.
Firms should engage in continuous research to correctly approximate consumer expectations and
plan to meet them to reduce consumer complaints.
Oriflame should enhance the situational factors such as display of items, appearance of sales
persons, location of showrooms as well as payment processes. These factors and other situational
factors will enhance the effectiveness of their sales promotions to influence their consumers.
Oriflame should periodically evaluate all its sales promotion programs so as to remain a trend
changing consumer expectations. In this contemporary world no strategy is static and to maintain
the dynamism, the existing sales programs needs to evaluated over time.

REFERENCES

34

Abdallat, M. and El-Emam, M. (2001): Consumer Behaviour Models in Tourism, King Saud.
University, Saudi Arabia
Adcock, D., Halborg, A. and Ross, G. (2001): Marketing Principles and Practice. 4th Pearsons
Education, Harlow, England.
Aderemi, S.A. (2003): Marketing Principles and Practice. Mushin: Concept Publication Limited.
Alvarez, B.A and Casielles, R.V. (2005): Consumer Evaluation of sales Promotion: The Effect
on Brand choice. Eur. J. Mark., Vol. 39, pp 54-70.
Belch G.E and Belch, M.A (1998): Advertising and Promotion: An Integrated Marketing
Communication Perspective.4th Edition.Irwin/ McGraw- Hill, Boston, Mass.
Berkowitz, K., Harley, R., Kerin, R.A. and Rudelius, W. (1994): Marketing, 4th Ed Irwin,
Boston.
Cravens, D.W. (2000): Strategic Marketing, 6th Edition, McGraw- Hill, Irwin.
Davidson, W.R., Sweeney, D.J. and Stampfi, R.W. (1984): Retailing Management. 5th Edition,
John Wiley and Sons, New York
Doyle, P. and Saunders, J. (1985): The Lead Effect of Marketing Decisions. Journal of
Marketing Research, Vol. 22, pp54-56.
Etzel, M.S., Walker, B.S. and Stanton, W.J. (1997): Marketing. 11th Edition, McGrae-Hill,
Irwin.
Kotler, P. (1994): Marketing Management. 8th Edition. Englewood Cliffs, New Jersey, Prentice
Hall.
Kotler, P. (1998): A generic concept of marketing: Marketing Management, Vol. 7, pp.441

35

Kotler, P., Armstrong, Gaunders J., and Wong, V. (1999): Principles of Marketing, 2nd Edition.
Prentice Hall Inc. New, S York
Philip Kotler, Gary Armstrong. Principles of Marketing 10th Edition. Prentice-Hall: 1980
Kotler, P. (2003): Marketing Management. 11th Edition, Prentice Hall, New York.
Kotler, P. and Keller, K.L. (2006): Marketing Management. 12th Edition. Pearson Education Plc
Ltd, India.
Kotler, P. and Keller, K.L. (2009): Marketing Management. 13th Edition.Pearson Prentice Hall.
Mugenda(2008) Research Methods: Qualitative and Quantative Approaches
Ngolanya, M., Mahea, T., Nganga, E., Amollo, F. and Karuiki, F. (2006): Influence of Sales
Promotion Campaigns on Consumer Purchase Decision: A Case Study of Nakumatt
Supermarkets. Department of Business Administration, University of Nairobi.
Peattie, K. and Peattie, S. (1993): Sales Promotion: Playing to win. Journal of Marketing
Management, Vol. 9.
Philip Kotler. Marketing Management 11th Edition. Prentice-Hall: 1967
Philip Kotler. Marketing Management 12th Edition. Prentice-Hall: 1967
Schultz, D.E, Robinson, W. and Petrison, L.A. (1998): Sales Promotion essentials, the 10 basic
Sales promotion techniques and how to use them, 3rd edition, NTC Contemporary
Publishing Company.
Schiffman, G. L. and Kanuk, L. (2007): Consumer Behaviour. 9th Edition, Prentice Hall.
Smith, S. and Schultz, D.E. (2005): How to sell more stuff: Promotional marketing that really
works, Dearborn Trade Publishing, USA.
APPENDIX 1

36

INTRODUCTION LETTER
JOMO KENYATTA UNIVERSITY OF AGRICULTURE AND TECHNOLOGY,
SCHOOL OF HUMAN RESOURCE DEVELOPMENT,
P.O BOX 81310-80100,
MOMBASA.
Dear Respondent,
RE: Research Project Questionnaire
I am a student at Jomo Kenyatta University of Agriculture and Technology, Mombasa Campus
pursuing an undergraduate degree course in Bachelor of commerce (Marketing option). In partial
fulfillment of the requirement for the award of the above mentioned Degree, I am required to
carry out and submit an academic research on the Effects of sales promotion on consumer buying
behavior.
Kindly assist me by filling in the attached questionnaire to the best of your knowledge.
We would like to assure you that this research is purely for academic purposes. Yourresponses
will be treated with extreme confidentiality. In fact all responses will be codedinto numbers and
no one will be individually identified. Only general, statistical andaggregate analysis will be
performed on the data. Hence, there would be no way anyonecan trace the results back to the
responses of any individual respondent.
Thank you for your time and cooperation.
Yours faithfully,
Grace Rehema Chilumo.

APPENDIX II

37

QUESTIONNAIRE
This questionnaire seeks to collect data about the Effect of sales promotion on consumer buying
behavior in Oriflame Natural Cosmetics Products. The data collected will be used for academic
purposes only, please take your time and answer the questions that follow.
Please tick () or provide your own answers where applicable.
1. Gender
Male ( )

Female ( )

2. Age:
Under 20 years ( ) 21- 30 years ( ) 31- 50 years ( ) 51 years and above ( )
3. For how long have you worked the company?
0 1 years ( ) 1 3years ( ) 3 5years ( ) 5 - 7 years ( ) 7 10 years ( ) 10 years and above ()
4. Which department do you belong to?
Management ( ) Marketing ( ) Purchasing ( )

Deposits ( )

Finance ( )

Research ( )

5. What promotional tools are employed by the Oriflame?


A. Coupons ( ) B. Samples ( ) C. Premiums ( ) D. Price packs ( )
E. Patronage awards ( ) D, Others (Please specify).
6. How likely are you to recommend promotional tools from Oriflame? Would you say the
chances are?
Excellent
Very good
Good
Fair
Poor
Indifferent
7. What do you deem appropriate in enhancing effectiveness of sales promotion?
Size of incentive
Decision on promotion and distribution

38

Length of information
Evaluation of all sales programs
8. How would you rate the overall quality of Oriflame relationship with customers,
considering all of sales promotion strategies employed?
Excellent
Very good
Good
Poor
Indifferent
9. On a scale of 1 5, how would you rate your level of overall satisfaction with sales
promotion strategies used by Oriflame?
1

Indicate on a scale of 1 to 5 where;


1 No extent, 2 Small extent, 3 Some extent, 4 Large extent, and 5 Very large
extent. The extent to which the following factors enhance sales promotion practice in
Oriflame.
10. Appearance of sales persons.
1 2 3 4 5

11. Attachment services offered.


1 2 3 4 5
12. Display of products at the outlets.
1 2 3 4 5
13. Free samples offered to customers for trial.
1 2 3 4 5
14. Short term reduction of prices on certain occasions like Christmas.
1 2 3 4 5

39

Thank you for your time and cooperation.

APPENDIX III
WORK PLAN
ACTIVITY

SEP

Identification of research topic


Presenting proposed topic to the supervisor
Collection of research data
Submission of research proposal

40

OCT

NOV

DEC

Presentation of correction of proposal


Editing of 1st draft to supervisor
Submission of corrections of proposal
Editing
Submission of final proposal for presentation
Presentation of project to the panel

Source Author (2013)

APPENDIX IV
BUDGET
Budget for the project
NO

ITEM

COST (Ksh)

Transport

2000.00

Communication

2000.00

Printing

6000.00

41

Flash disk

1200.00

Stationery

1000.00

Photocopy

4500.00

Binding

800.00

Miscellaneous

3000.00

TOTAL

20,500.00

Source Author (2013)

42