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Transcript of The Effects of Marketing Mix (4ps) On Sales Performance of Telecommunication Company in Tanzania
THE EFFECTS OF MARKETING MIX (4Ps) ON SALES
PERFORMANCE OF TIGO TELECOMMUNICATION
COMPANY IN TANZANIA
THE EFFECTS OF MARKETING MIX (4Ps) ON SALES
PERFORMANCE OF TIGO TELECOMMUNICATION
COMPANY IN TANZANIA
By
Joyce Frank Saguti
A Research Dissertation Submitted to Mzumbe University Dar es Salaam
Campus College in Partial Fulfilment of the Requirements for the Award of the
Degree of Master of Science in Marketing Management (MSc - MKT) of
Mzumbe University
2015
THE EFFECTS OF MARKETING MIX (4Ps) ON SALES
PERFORMANCE OF TIGO TELECOMMUNICATION
COMPANY IN TANZANIA
By
Joyce Frank Saguti
A Research Dissertation Submitted to Mzumbe University Dar es Salaam
Campus College in Partial Fulfilment of the Requirements for the Award of the
Degree of Master of Science in Marketing Management (MSc - MKT) of
Mzumbe University
2015
i
CERTIFICATION
We, the undersigned, certify that we have read and hereby recommend for
acceptance by the Mzumbe University, a dissertation entitled The Effects of
Marketing Mix (4ps) On Sales Performance of Telecommunication Company in
Tanzania in partial fulfilment of the requirements for award of the degree of Master
of Marketing Management of Mzumbe University.
----------------------------------------
Major Supervisor
----------------------------------------
Internal Examiner
Accepted for the Board of -----------------------------------------------
DEAN/ DIRECTOR, FACULT/ DIRECTOR/ SCHOOL/ BOARD
ii
DECLARATION
AND
COPYRIGHT
I, Saguti, Joyce Frank hereby declare to Mzumbe University that this work is my
own original work and that it has not been submitted to other university for academic
or professional award.
Signature: _______________________
Date: ___________________________
Copyright © 2015
This dissertation is a copyright material protected under the Berne Convention, the
copyright Act 1999 and other international and national enactment, in that behalf, on
intellectual property. It may not be reproduced by any means in full or in part, except
for short extracts in fair dealings, for research or private study, critical scholarly
review or discourage with an acknowledgement, without the written permission of
Mzumbe University, on behalf of the author.
iii
AKNOWLEDGEMENTS
I hereby acknowledge the support of my supervisor Dr Madale; it is through the
abundance of his knowledge that has made this work to its perfection. I also thank
Tigo staff and Tigo Customers who were willing to participate in this study. Special
thanks to my young sister Rosemysticar, my sister Nelina and Consumer
Understanding Team at Tigo Headquarters office who contributed much in
conducting this research.
It is through the unique love of my precious husband Peter that made me come this
far in this research. I real appreciate your concern.
iv
DEDICATION
I dedicate this work to my lovely husband Peter and my lovely son Ethan future
Brand Manager. Also much dedication to the Almighty God who protected and
guided me during the whole process of conducting this research, May the glory and
honour is to our God forever and ever “Umenifanya Ning’are”, Amen.
v
LIST OF ABBREVIATIONS
ARPU - Average Revenue per User
MO - Marketing Operations
MP - Marketing Performance
TCRA - Tanzania Communication Regulatory Authority
TTCL - Tanzania Tele-Communication Limited
USSD - Unstructured Supplementary Service Data
ZANTEL - Zanzibar Telecommunication
vi
ABSTRACT
Effects of marketing Mix elements on sales performance of telecommunication
Company in Tanzania have not received sufficient attention. This knowledge gap
inspires this proposed study. The broad objective is to investigate how product, price,
promotion and place can be applied to increase sales volume of telecommunication
company especially Tigo telecom in Tanzania. The specific objectives of this study
comprises four objectives in this report which are to explore how product
considerations influence sales performance of telecommunication Company in Dar es
Salaam town as well as to determine the extent to which price influence sales
performance of telecommunication Company in Dar es Salaam town, also to
establish the effect of promotion on sales performance of telecommunication
Company in Dar es Salaam town, and lastly to examine the effect of place/location
on sales performance of telecommunication Company in Dar es Salaam town. Recent
studies conducted in the developing economies are reporting contradictory evidence
regarding the impact of marketing practices on organizational performance. Ellis
(2005) in Hong Kong, Appiah-Adu (1998) in Ghana and Akimova (2000) in Ukraine
found that marketing practices impact on performance much more than market
orientation. Herein lays a major gap in knowledge. Marketing as a concept revolves
around customer, profits and sales volume. Its implementation must involve the
entire organization in an integrated manner. It focuses on obtaining information
about customer needs and wants and taking action based on this information in order
to satisfy the needs and wants. The 4Ps of product, place, price and promotion is a
generic marketing mix that has been applied by many organizations and businesses
to position themselves competitively in the market. When designed properly, it
promises high sales, profits and market share (Turner and Spencer, 1997). A survey
of selected service stations in the town is chosen to determine the effects of the 4 Ps
on sales performance of the products in the telecommunication. 65 Customers and 35
members of staff make up the sample drawn from Tigo telecom. Systematic
sampling was applied to select from respondents from each Tigo telecom. The data
collection tool is questionnaire designed and tested by the researcher for reliability
vii
and validity. Tigo telecom sections were included in covering product, price,
promotion place and sales performance. The results of the study will benefit industry
players; marketers, telecom of Tanzania, staff and regulator (TCRA). The expected
outcome is that the marketing mix elements (4Ps) hold the key to improving sales
performance of telecommunication Company in Tanzania. This happens through the
singular and collective contribution of the variables to sales performance.
viii
TABLE OF CONTENTS
Pages
CERTIFICATION ...................................................................................................... i
DECLARATION ........................................................................................................ ii
AND ............................................................................................................................. ii
COPYRIGHT ............................................................................................................. ii
AKNOWLEDGEMENT ........................................................................................... iii
DEDICATION ........................................................................................................... iv
LIST OF ABBREVIATION ...................................................................................... v
ABSTRACT ............................................................................................................... vi
TABLE OF CONTENTS ........................................................................................ viii
LIST OF TABLES .................................................................................................... xi
Pages ........................................................................................................................... xi
LIST OF FIGURES ................................................................................................. xii
Pages .......................................................................................................................... xii
CHAPTER ONE ........................................................................................................ 1
INTRODUCTION AND BACKGROUND .............................................................. 1
1.1 Introduction of the study ........................................................................... 1
1.2 Background of study ................................................................................. 2
1.3 Statement of the problem .......................................................................... 4
1.4 Research Objectives .................................................................................. 5
1.4.1 Overall objective ....................................................................................... 5
1.4.2 Specific objectives..................................................................................... 5
1.5 Research Questions ................................................................................... 5
1.6 Significance of the Study .......................................................................... 6
1.7 Scope of the Study..................................................................................... 6
1.8 Limitations of the Study ............................................................................ 7
CHAPTER TWO ....................................................................................................... 8
LITERATURE REVIEW .......................................................................................... 8
2.1 Conceptual Definition of terms ................................................................. 8
ix
2.1.1 Product ...................................................................................................... 8
2.1.2 Price ........................................................................................................... 8
2.1.3 Place (Distribution) ................................................................................... 9
2.1.4 Promotion .................................................................................................. 9
2.2 Marketing mix ......................................................................................... 10
2.4 Marketing Mix and Sales Performance ................................................... 22
2.5 Marketing Strategies ............................................................................... 23
2.6 Marketing Theories ................................................................................. 24
PESTEL Analysis ..................................................................................................... 24
Boston Consulting Group Matrix theory ............................................................... 24
Relevance of Boston Theory to the Study .............................................................. 25
2.7 Mobile Phone Industry in Tanzania ........................................................ 25
2.8 Empirical studies related to the problem ................................................. 26
2.9 Conceptual Framework ........................................................................... 30
2.10 Research Gap........................................................................................... 31
CHAPTER THREE ................................................................................................. 33
RESEARCH METHODOLOGY ........................................................................... 33
3.1 Introduction ............................................................................................. 33
3.1.1 Research Design ...................................................................................... 33
3.2 Area of the Study..................................................................................... 33
3.3 Research Approach ................................................................................. 34
3.4 Population, Sampling Design and Sampling procedures ........................ 34
3.5 Sample Size and Sampling Techniques .................................................. 34
3.5.1 Research Sample size .............................................................................. 34
3.5.2 Sampling Techniques .............................................................................. 34
3.6 Source of Data ......................................................................................... 35
3.6.1 Primary Data Collection .......................................................................... 35
3.7 Reliability and Validity of Data .............................................................. 36
3.7.1 Reliability ................................................................................................ 36
3.7.2 Validity .......................................................................................................... 37
3.8 Data Presentation and Analysis ............................................................... 37
CHAPTER FOUR .................................................................................................... 38
x
RESULTS AND DISCUSSION .............................................................................. 38
4.1 Introduction ............................................................................................. 38
4.2 Demographics information ...................................................................... 38
4.3 Influence of Product consideration on Sales performance ...................... 41
4.6 Effect of Place on Sales Performance .............................................................. 52
CHAPTER FIVE ...................................................................................................... 56
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS ......................... 57
5.1 Introduction ............................................................................................. 57
5.2 Summary ................................................................................................. 57
5.3 Conclusion ............................................................................................... 58
5.4 Recommendations ................................................................................... 59
xi
LIST OF TABLES
Pages
Table 2.1: Subscribers per Operation .................................................................... 25
Table 2.2: Growth of Mobile Market Industry ...................................................... 26
Table 3.1: Distribution of Respondents ................................................................. 34
Table 4.4.2 To what extent price influence customer to buy product ........................ 46
xii
LIST OF FIGURES
Pages
Figure 2.1: The Elements of Marketing Mix .......................................................... 10
Figure 2.2: Illustrative Diagram to Conceptual frame work ............................... 30
Figure 4.1: Demographics Information: Gender .................................................... 39
Figure 4.2: Demographics information: Age .......................................................... 39
Figure 4.6.1: Where do you sell Tigo Products?.................................................... 52
1
CHAPTER ONE
INTRODUCTION
1.1 Introduction of the study
Marketing mix has a vital role in sales performance in telecom industry. Because of
the large amount of requirements in projects forced decision makers to establish new
strategies to increase sales in Tigo Telecom Company. In addition they should
prepare marketing plan for using in their marketing strategic planning and firm
strategic planning in order. For this reason marketing strategists as refined persons in
this field need to know about the marketing condition in present time in the industry.
Therefore comprehending the priorities in this field of industry are very considerable.
The fact that current research focused on market orientation has done a lot of
research in this field but, the marketing mix review as a very important issue in the
Telecom industry that can be a great help to researchers and those working in the
industry specifically investors. In addition sales performance as one of the most
important factors in any activity on the factors that make up the marketing
infrastructure can satisfy the needs of the company and adjust the level of
expectations of this industry. According to Crittenden marketers have done an
excellent job of instilling the 4Ps of the marketing mix into the mind of anyone
interested in business (Crittenden, 2005).
With respect to this thought, all companies expect to improve their sales
performance.In competitive world, today, customers place in focus of firms’
attention and their satisfaction is major factor of organizations competitive
advantage. The necessity of inviting customers’ satisfaction is completely fulfilment
of their needs and accurately recognition of their desires, expectances, capabilities,
and their limitation of purchase. By access to this information, it can correctly
identify influence factors of consumers’ behaviour and use it to take corporations
marketing decisions (Salar, 2009, p.2).Therefore the objective was to explore the
2
effects of marketing mix as one the important issues in marketing management and
sales performance.
1.2 Background of study
Marketing mix is originating from the single P (price) of microeconomic theory
(Chong, 2003). McCarthy (1964) offered the marketing mix, often referred to as the
4Ps, as a means of translating marketing planning into practice (Bennett, 1997).
Marketing mix is not a scientific theory, but merely a conceptual framework that
identifies the principal decision making managers make in configuring their offerings
to suit consumers’ needs. The tools can be used to develop both long-term strategies
and short-term tactical programmes (Palmer, 2004).
The idea of the marketing mix is the same idea as when mixing a cake. A baker will
alter the proportions of ingredients in a cake depending on the type of cake we
wishes to bake. The proportions in the marketing mix can be altered in the same way
and differ from the product to product (Hodder Education, n.d). The marketing mix
management paradigm has dominated marketing thought, research and practice
(Gronroos, 1994), and as a creator of differentiation. (Kent, 1986) refers to the 4Ps of
the marketing mix as the holy quadruple of the marketing faith written in tablets of
stone. Marketing mix has been extremely influential in informing the development of
both marketing theory and practise (Moller, 2006).
Borden (1965) claims to be the first to have used the term marketing mix and that it
was suggested to him by (Culliton’s1948) description of a business executive as
mixer of ingredients. An executive is a mixer of ingredients, who sometimes follows
a recipe as he goes along, sometimes adapts a recipe to the ingredients immediately
available, and sometimes experiments with or invents ingredients no one else has
tried(Culliton, 1948).
The early marketing concept in a similar way to the notion of the marketing mix,
based on the idea of action parameters presented in 1930s by Stackelberg (1939).
(Rasmussen, 1955) then developed what became known as parameter theory which
3
proposes that the four determinants of competition and sales are price, quality,
service and advertising. (Mickwitz1959) applies this theory to the Product Life Cycle
Concept. Borden’s original marketing mix had a set of 12 elements namely: product
planning; pricing; branding; channels of distribution; personal selling; advertising;
promotions; packaging; display; servicing; physical handling; and fact-finding and
analysis.
Frey (1961) suggests that marketing variables should be divided into two parts: the
offering (product, packaging, brand, price and service) and the methods and tools
(distribution channels, personal selling, advertising, sales promotion and publicity).
On the other hand, Lazer and Kelly (1962) and Lazer, Culley and Staudt (1973)
suggested three elements of marketing mix: the goods and services mix, the
distribution mix and the communication mix. McCarthy (1964) refined Borden’s
(1965) idea further and defined the marketing mix as combination of all of the
factors at a marketing manager’s command to satisfy the target market.
Frey regrouped Borden’s twelve elements to four elements or 4Ps, namely product,
price, promotion and place at a marketing manager’s command to satisfy the target
market. Especially in 1980s onward, number of researchers proposes new ‘P’ into the
marketing mix. Judd (1987) proposes fifth P (people). Booms and Bitner (1980) add
3 Ps (participants, physical evidence and process) to the original 4 Ps to apply the
marketing mix concept to service. Kotler (1986) adds political power and public
opinion formation to the PS concept.
Baumgartner (1991) suggested that the concept of 15 Ps. MaGrath (1986) suggested
the addition of 3 Ps (personnel, physical facilities and process management).
Vignalis and Davis (1994) suggested the addition of S (service) to the marketing
mix. Goldsmith (1999) suggested that there should be 8 Ps (product, price, place,
promotion, participants, physical evidence, process and personalisation).
Moller (2006) presented an up-to-date picture of the current standing in the debate
around the Mix as marketing paradigm and predominant marketing management tool
4
by reviewing academic views from five marketing management sub-disciplines
(consumer marketing, relationship marketing, services marketing, retail marketing
and industrial marketing) and an emerging marketing (E-Commerce). Most of
researchers and writers reviewed in these domains express serious doubts as to the
role of the Mix as marketing management tool in its original form, proposing
alternative approaches, which is adding new parameters to the original Mix or
replacing it with alternative frameworks altogether.
1.3 Statement of the problem
Recent studies conducted in the developing economies are reporting contradictory
evidence regarding the impact of marketing practices on organisational performance.
(Ellis 2005) in Hong Kong, (Appiah-Adu, 1998) in Ghana and Akimova (2000) in
Ukraine found that marketing practices impact on performance much more than
market orientation. Herein lays a major gap in knowledge.
Marketing as a concept revolves around customer, profits and sales volume. Its
implementation must involve the entire organisation in an integrated manner. It
focuses on obtaining information about customer needs and wants and taking action
based on this information in order to satisfy the needs and wants. The 4Ps of product,
place, price and promotion is a generic marketing mix that has been applied by many
organisations and businesses to position themselves competitively in the market.
When designed properly, it promises high sales, profits and market share (Turner and
Spencer, 1997).
What inspired this study is the knowledge gap about the effects of marketing mix
elements (4 p’s -product, price, place and promotion) on sales performance of
telecommunication among selected service stations in Dar es Salaam town. By
gaining insights into how sales are affected by the 4Ps marketing mix, industry
player are going to design their marketing campaigns better to reap higher profits
while minimizing costs hence improving on the efficiency (Kotler, 2003). In a highly
competitive industry like the telecom, each shilling spent must be justified by the
gain in the marketing efforts pursued. Only through finding from studies like this
5
would lend credence on the marketing activities undertaken by the various service in
the firms, effects of marketing Mix elements on sales performance of
telecommunication Company in Tanzania have not received sufficient attention,
therefore in this study is to assess the effects of 4ps Marketing Mix on Sales
Performance of telecommunication company in Tanzania.
1.4 Research Objectives
This part of the study introduced the objectives which were covered by the study.
The general objective showed the general purpose that have been attained while
specific objectives showed how specifically the study addressed different issues of
online services.
1.4.1 Overall objective
Generally, the study investigated the factors influencing sales performance of
Telecommunication Companies in Dar es Salaam
1.4.2 Specific objectives
(i.) To explore the influence of product consideration on sales performance of
Tigo telecom firm in Dar es Salaam
(ii.) To determine the extent to which price affect sales performance of Tigo
telecom firm in Dar es Salaam
(iii.) To establish the effect of promotion on sales performance of Tigo telecom
firm in Dar es Salaam
(iv.) To examine the effect of place/location on sales performance of Tigo telecom
firm in Dar es Salaam
1.5 Research Questions
(i.) How do product considerations influence sales performance of Tigo telecom
firm in Dar es Salaam?
(ii.) What are the extents to which price influence sales performance of Tigo
telecom firm in Dar es Salaam?
6
(iii.) What are the effects of promotion on sales performance of Tigo telecom firm
in Dar es Salaam?
(iv.) What are the effects of place/location on sales performance of Tigo telecom
firm in Dar es Salaam
1.6 Significance of the Study
The study benefited to the telecom marketers who are facing increasing competition
identified the right mix for managing sales in order to improve their profit margins.
Also, Staff members in the retail outlets understood how the 4P’s influenced sales
performance so that they improved layout and service quality. Besides the successful
completion of this research by the researcher enabled her to be awarded Masters in
Marketing Management.
1.7 Scope and delimitation of the Study
Results of the study based on data which was collected from Tigo staff at Tigo
Headquarters’ office and Tigo customers in Dar es Salaam, where the study
investigated the factors influencing sales performance of Tigo Telecommunication
Company.
A researcher was compelled to take a local leave so as to overcome demanding work
schedule which gave her time for field work. A case study design was chosen in Dar
es Salaam region where the researcher is working so as to overcome financial
constraint.
The researcher had to explain to the respondents the necessity of their information to
the study and the importance of them taking part in the process. Also the researcher
ensured that respondents’ information is anonymous.
The researcher translated the questions into Swahili language so that the respondents
could understand and provide the needed information.
7
1.8 Limitations of the Study
This section presented limitations that were encountered and how they were
addressed. In carrying out the research, some of the limitations which were
encountered in the study include:
(i.) Financial and Time resource
The study was carried out under limited resources since the researcher funded it
through own sources. The costs includes, traveling costs and stationary. To address
this challenge, the researcher conducted the study based in Dar es Salaam to
minimize the cost. Also, the study was conducted under limited time to meet the
academic calendar of Mzumbe University. The study collected data from the sample
and generalized them to meet the challenge of time. Also, the researcher extended
working time to include weekends in addressing the challenge.
(ii.) Resistance from Respondents
The study collected data from respondents who were willing to participate; it was
expected that some respondents (among respondents) were resistant at providing the
information. The researcher provided required information to make respondents
understood the importance of taking part in the process.
(iii.) Language barriers
The accepted language for academic communications in Tanzania is English. On the
other hand, Swahili is the national language of Tanzania; therefore most of
respondents were not competent in communicating through English. The researcher
translated the questions to include Swahili language for easy understanding.
8
CHAPTER TWO
LITERATURE REVIEW
2.1 Conceptual Definition of terms
These four P's are the parameters that the marketing manager can control, subject to
the internal and external constraints of the marketing environment. The goal is to
make decisions that centre the four P's on the customers in the target market in order
to create perceived value and generate a positive response. As Pedhazur and
Schmelkin (1991, p. 164) have noted, “Even for people who speak the same
language, words have different meanings, depending on, among other things, who
speaks, to whom, in what context, at what time, and with what purpose . The point is
that the different terms reflect different outlooks, values, attitudes, and the like.”
2.1.1 Product
The term "product" refers to tangible, physical products as well as services. Although
this typically refers to a physical product, it has been expanded to include services
offered by a service organization. (Armstrong, 1997)
The product has to have the right features - for example, it must look good and work
well.
Lamb et al (2009) divided product into two parts, namely business and customer
product. A product can be a good or as service. When considering product as a
marketing element, issues such as brand, quality, design and packaging are very
important. A company must devise strategies to boost demand for its product in order
to succeed in the market. The brand should be acceptable to the customer; the quality
should be high so that loyalty of the buyer can be won through satisfaction. (Seine,
1993).
2.1.2 Price
This is the amount paid for a product. Price means the monetary value of the product
has been fixed for exchange purpose. (Kotler, 1997)
Price is the one, which creates sales revenue - all the others are costs. The price of an
item is clearly an important determinant of the value of sales made. In theory, price is
9
really determined by the discovery of what customers perceive is the value of the
item on sale.
The main element of this is the amount a customer pays for a product. This amount
determines the level of profit for a company and consequently its survival. Charging
price has a profound impact on marketing strategy, price elasticity of the product
which then affects demand and sales. The price should therefore be set to
compliment other elements of two marketing mix (Needam Dare (1996) Business for
High Awards, Oxford England Heinemann).
2.1.3 Place (Distribution)
Place represents the location where a product can be purchased. It is often referred to
as the distribution channel. It can include any physical store as well as virtual stores
on the Internet. (ibid)
'Place' is concerned with various methods of transporting and storing goods, and then
making them available for the customer. Getting the right product to the right place
at the right time involves the distribution system. The choice of distribution method
will depend on a variety of circumstances. It will be more convenient for some
manufacturers to sell to wholesalers who then sell to retailers, while others will
prefer to sell directly to retailers or customers.
Businesses need to decide on the place of purchase or where and how to distribute
the product to the customer. Consumer would be satisfied if products are made
available at the right time, in the right place and in the right quantity. (Hashin, 2011).
2.1.4 Promotion
This represents the various aspects of marketing communication, that is, the
communication of information about the product with the goal of generating a
positive customer response. (Aderemi, 2003).
Promotion involves a variety of activities undertaken by a firm to communicate the
merits of its products and to persuade target consumes to purchase it. (Nasirundin,
2011) It includes activities like advertising, sales promotion, personal selling and
10
publicity. Promotional techniques common to the oil industry has been price
discounts, free gifts and vouchers, advertisements in the press
2.2 Marketing mix
The marketing mix is a model of creating and implementing marketing strategies. It
stresses the blending of various factors in such a way that both organizational and
consumer objectives are attained. The elements are the marketing tactics, also known
as the 'four Ps', the marketing mix elements are price, place, product, and promotion.
The model was developed by Neil Borden (Borden, 1964) who first started using the
phrase in 1949. When blending the mix elements, marketers must consider their
target market. They must understand the wants and needs of the market customer
then use these mix elements in constructing and formulating appropriate marketing
strategies and plans that will satisfy these wants.
Figure 2.1: The Elements of Marketing Mix
Source: Borden, 1964
All the elements of the marketing mix influence each other. They make up the
business plan for a company and handled right, can give it great success. But handled
Target
Market
PRICE
PROMOTION PLACE
PRODUCTION
11
wrong and the business could take years to recover. The marketing mix needs a lot of
understanding, market research and consultation with several people, from users to
trade to manufacturing and several others.
2.3 About Telecom Industry in Tanzania
Telecommunication facilities in Tanzania are available in most parts of the country
and are linked to the rest of the world through Dar es Salaam, the country's
commercial capital. Until 1993, the Tanzania Posts and Telecommunications
Corporation (TPTC) not only regulated this sector, but also held a monopoly in the
provision of communications in Tanzania.
When the Communications Act was enacted, as part of the government's move to
liberalize the communications sector in the country, the Tanzania Posts and
Telecommunications Corporation was split into three different entities: the Tanzania
Posts Corporation (TPC), the Tanzania Telecommunications Company Limited
(TTCL) and the Tanzania Communication Commission (TCC).
Furthermore, in 1997 the National Telecommunications Policy (NTP) was launched.
Since then, the telecommunications sector has become partially liberalized and
competition has grown in mobile cellular services, radio paging, and internet services
and data communications services.
Today, the Information and Communication Technologies (ICTs) sector in Tanzania
has been completely liberalized. Within such a framework, the Tanzania
Telecommunications Company Limited (TTCL) was privatized in 2001.
Since then, the communications sector in the country has played an important role in
the social and economic development of Tanzania and it is expected to continue to
do so in the future.
2.4 Tigo Telecom in Tanzania
MIC Tanzania Limited (tiGO) was found on November 30, 1993. This corporation
was a joint venture between Millicom International Cellular based in Luxembourg,
12
Ultimate Communications Limited of Tanzania and Tanzania Posts and
Telecommunications Corporation. In this venture, 27.7% of the issued share capital
was allotted to the Ultimate Communications Limited and Tanzania Posts and
Telecommunications Corporation.
In 1993, there was liberalization of telecommunication sector in the country which
result into dissolution of Tanzania Posts and Telecommunications Corporation
(TPTC) in early 1994. Its shares ware then transferred to Tanzania
Telecommunications Company Limited. Further steps towards full liberalization of
the market causes the privatization of TTCL on February 23, 2001 and its shares
were transferred to the Tanzanian Government.
In February 2006, after buying out its minority shareholders, the Luxembourg-based
pan-African mobile operator Millicom International Cellular announced to take a full
control of three of its African-based Mobile operators including MIC Tanzania
limited.
In Tanzania a USD 1.332 million deal enables Millicom to acquire the remaining
16% stake it did not already own after the cello’s minority shareholders agreed to
cancel their call option on the business. Since then Millicom is the full controller of
the company where they now own 32% of Telecom market share in Tanzania and
company has almost 12m customers.
2.2The perspective of marketing mix factors
2.2.1 Product perspective
In a purchase context, it is important to consider what elements of an item will be
obvious. Definitely one is the product itself, and the other is the brand of the product
(Bearden and Etzel 1982). A brand can be defined as a name, term, sign, symbol, or
design, or combination of them, which is intended to identify the goods and services
of one seller or group of sellers and to differentiate them from those of competitors
(Keller 1993).
13
A company's corporate brand provides consumers with expectations of what the
company will deliver (Argenti and Druckenmiller). Brand name is a critical
indication for customer perceptions of product quality (.Krishnan R, et al. 1998).
In a context of global competition and decreasing profits from product sales, the
after- sales services and activities (i.e. those taking place after the purchase of the
product and devoted to support customers in the usage and disposal of goods)
constitute a relevant profit source as well as a key differentiator for manufacturing
companies and resellers (Wise and Baumgartner 1999).
The strategic importance of after sales product support services that enable the
availability of mission critical products has been recognized in industries where
products are complex and the consequences of product downtime can be severe . In
some industries, the profit margin for the sales of service parts and for the provision
of after sales services (for repair, maintenance and upgrades), far exceeds the margin
on the sale of the product itself (Cohen, 1997).
The service market can be four or five times larger than the market for products
(Bundschuh and Dezvane 2003) and it may generate at least three times the turnover
of the original purchase during a given product's life cycle ( Wise and Baumgartner
1999). Cohen and Whang (1997) report on a benchmarking study of 14 companies in
the electronics, computing and communication industries. They found after sales
service revenues constitute 30% of product sales revenues. The notion of after sale
support is becoming an important feature of any product sale.
Ampuero and Vila (2006) have indicated that positioning has its origins in product
packaging (the concept was called product positioning). This literally means the
shape of the product, the size of the package and its price in comparison to the
competition. Once the positioning plan has been completed (and the company knows
how it wants to present itself to the market with respect to its competition),
the company implements a plan of action through the construction of a suitable
marketing mix. If we focus on "communication" activities, the sequence should be
the following: a positioning decision identifies the product characteristics that
should be stressed in the marketing mix, particularly in its communication campaign.
14
Packaging is becoming an increasingly important factor for many reasons. Managers
are increasingly recognizing that packaging can create differentiation and identity,
above all in relatively homogenous perishable consumer goods.
However, in general terms, packaging is the container that is in direct contact with
product itself, which holds, protects, preserves and identifies the product as well as
facilitating handling and commercialization (Vidales, 1995). From the managerial
point of view, in order for packaging to suitably develop its functions, the structural
and graphic design of the packaging and even the optimum size of the pack will be
subject to market research undertaken by the company and the positioning that the
company wants the product to occupy in the market.
Therefore, packaging is specifically related to the strategic decisions of the
marketing mix (Underwood 2003). While from the consumer perspective, packaging
is crucial, given that it is the first thing that the public sees before making the final
decision to buy (Vidales, 1995). All the packaging elements, including texts, colours,
structure, images and people/ personalities have to be combined to provide the
consumer with visual sales negotiation when purchasing and using the product
(McNeal, et al. 2003). Packaging plays a major role in communicating brand
personality by means of several structural and graphic elements (Ampuero and Vila
2006).
Product uniqueness is defined as the degree to which the product is designed or made
to satisfy unique needs or to be used for unique purposes (Cavusgil et al. 1993). That
product uniqueness and superiority is such an important ingredient in new
product success is so obvious and trusty that it tends to be overlooked. The product is
the core or central strategy in most industrial new product ventures; and it is through
the product that the firm must seek its differential advantage (Cooper, 1979).
Unique products are typically highly innovative and new to the market, the products
meet customers' need better than the competing products, the new products can bring
along cost reductions and they are in general more durable, reliable and of higher
quality than their predecessors (Cooper and Kleinschmidt, 1995). By developing a
unique value proposition to create a strong differential from competitors, firms aim at
15
attracting more consumers and achieving a better positioning on the
competitive market. The value proposition should skilfully integrate the increasing
quality of prospective leads and market share and the improvement of operational
efficiency to attract consumers to enter into a relationship with the firm. In that way,
firms increase the perceived value of their products and services relative to the
perceived value of the products and services of their competitors, achieving
competitive advantage.
2.2.2 Place perspective
Distribution channels are primarily set up to perform a set of essential economic
functions in society, bridging the gap between production and consumption (Stern
and Reve, 1980).
The channel relationship can be perceived as a reference group that uses normative
influence when, for example, a distributor feels compelled to conform to
norms established by the supplier in order to continue the channel partnership.
This normative function appears commonplace in a channel in which a large
or well established supplier sets goals and norms of behaviour for the
distributor. The distributor then is willing to behave in a manner dictated by the
supplier to reap the reward of higher profits.
As noted in the study of the office systems and furniture industry, operating
suggestions from the supplier can become strategic mandates for the distributor. It is
important to recognize that it is through distribution that the manufacturer can
provide the kinds and levels of service that create superior customer value and lead
to very satisfied customers (Simpson et al. 1998). When the distributor takes on
major responsibility for promoting a product line, it is likely to be a line that provides
a large share of his total volume (Webster, 1991).
Globalization progressed significantly in the past decade, facilitated by modern
communication, transportation and improved legal infrastructure as well as the
Political choice to consciously open markets to international trade and finance2. This
rapid globalization has occurred as a result of several circumstances:
16
rapid technological changes in communications and transport; an increasing trend
towards deregulation of foreign exchange, foreign investment and financial markets;
and the creation of greater incentives and opportunities for companies (Mohanty and
Nandi, 2010).
Companies go international for a variety of reasons, but the goal is typically
company growth or expansion. Companies go international to broaden
their workforce and obtain new ideas. A workforce comprised of different
backgrounds and cultural differences can bring fresh ideas and concepts to help a
company grow. Some companies go international to diversify. Selling products and
services in multiple countries reduces the company's exposure to possible economic
and political instability in a single country.
In addition, many companies look to international markets for growth. Introducing
new products internationally can expand a company's customer base, sales and
revenue. They find alternative sources of labour in international markets. Some
companies look to international countries for lower cost manufacturing, technology
assistance and other services in order to maintain a competitive advantage.
Moreover, they locate resources that are difficult to obtain in their home markets, or
that can be obtained at a better price internationally.
2.2.3 Price perspective
The consumer's perception of the quality of a product is an admixture of a variety of
informational inputs concerning a set of criteria he has established for judging the
product. The uncertainties associated with assessing the quality of a particular
product stem from (1) uncertainty concerning the criteria that should be used, (2)
uncertainty as to the degrees of completeness and reliability of the information held
on each criterion, and (3) uncertainty about the predictive value of each criterion.
When the customers do not have much of the information in above areas, they
always tend to judge by the level of the price and brand to judge products quality.
The price reflects the product’s competitive positioning and indicates the product
17
quality, innovativeness, and benefits for consumers. The consumer is knowledgeable
of the configuration of attributes that comprise a product or service. Further, the
consumer is aware of the product price alternatives available to him, has well defined
tastes and preferences, and can determine his marginal rate of substitution for each
product for the other possible alternative products involved in a particular purchase
decision (Tuli et al, 2007).
Scanning and penetration pricing strategy are two pricing strategies. The new
product pricing decision involves the launch price and the choice between scanning
and penetration (Hotlink et al. 2000). Some customers are used to choose higher
prices more frequently because they are more concerned with doing the
socially "right" things, which will guarantee acceptance either by their peers or
by the members of the next high stratum. In addition, the products themselves may,
for many reasons, carry with them some stereotyped notions about their own quality
(Leavitt, 1954).
A firm's prices must ensure that it is profitable, or at least that it covers its costs.
Cost- based pricing focuses on this consideration. Some customers should not find
themselves subsidizing the cost of providing services to other customers. If prices do
not reflect actual costs or they hide costs of inefficient production then they invite
competition from other firms. Since customers will choose the provider from whom
they believe they get the best deal, a game takes place amongst providers, as they
seek to offer better deals to customers by deploying different cost functions and
operating at different production levels. Prices must be subsidy-free and sustainable
if they are to be stable prices, that is, if they are to survive the competition in this
game (Courcoubetis and Weber, 2003).
In some Telecom industries particularly those in which there are a few dominant
competitors and many small companies, the top companies are in the position of
holding price leadership roles where they are often the first in the industry to change
price. Smaller companies must then assume a price follower role and react once the
big companies adjust their price. Using a competitive pricing tool can give retailers a
significant advantage over competitors. From there retailers can determine how to
18
best react. To compete with another company's pricing, a simple method is to price
the product at the same level competitors' price their product.
Most firms sell a variety of products and thus require a set of different marketing
strategies. Generally, the firm has several product lines-groups of products that are
closely related either because they are used together, satisfy the same general needs,
or are marketed together. Usually within a product line some products are
functionally substitutes for each other, and some products are functionally
complementary to each other. Because of the demand and cost interrelationships
inherent within a product line, and because there are usually several price-market
targets, the product-line pricing problem is one of the major challenges facing
a marketing executive (Monroe and Bitta, 1978).
The traditional approach to pricing a line of products, founded in economic theory,
focuses on obtaining the optimal price solution for a multiproduct firm when the firm
is interested in maximizing contribution to profit. Cost and demand information that
is needed for this approach is not readily available to the decision maker, in addition,
while optimization techniques can prescribe an optimal price for individual product
models under the objective of profit maximization, in reality the multifaceted
organization may have multiple objectives hat may not be solely profit oriented. Due
to these difficulties, costs have often provided the basis for product line pricing
(Petroshius and Monroe, 1997). Product line pricing is used when a primary product
is offered with different features or benefits, essentially creating multiple “different"
products or services.
2.2.4 Promotion perspective
The increase of promotional activity in many product categories may be training
consumers to buy on promotion. If so, consumer expectations about
future promotional activities are just as important to understanding consumer choice
behaviour as consumer expectations of price (Lattin and Bucklin, 1989).
The general phenomenon of promotion accompanied by significant discounts
has been widely researched in marketing literature (Dodson, et al. 1978). A
19
promotion typically leads to a dramatic increase in sales for the promoted brand
(Inman and McAlister 1993).
Though research has documented the success of pricing and promotion in stimulating
immediate sales response, there is concern about the long-run implications of such
activity (Guadagni and Little, 1983). Some industry experts contend that frequent
price discounting blurs the distinction between the deal price and the baseline price
of a product (Lattin and Bucklin, 1989).
In 1980s, retail promotion has had an increasingly important effect on consumer
choice behaviour (Lattin and Bucklin, 1989). Manufacturers of consumer
packaged goods were able to convince the retailer to conduct in-store promotional
activities for two reasons. First, a manufacturer's sales force provided evidence from
syndicated sales auditing services supporting the effectiveness of promotion in
cultivating new customers for a particular brand.
The implication was that the retailer would benefit directly from the increased sales
of the promoted brand. Second, trade deals were offered to increase (or maintain)
the retailer's margin for the manufacturer's brand. Retail promotion enables both
retailer and manufacturer to meet objectives when brand substitution occurs within
the store and customers from other stores switch, or cross-shop, to take advantage of
the promotion. Both the retailer and the manufacturer of a promoted brand also
could benefit when that brand yields a higher margin for the retailer (possibly
because of a trade deal) and consumers switch to this brand, producing greater sales
for the manufacturer (Kumar and Leone, 1988).
The selling and non-selling dimensions of trade show participation were examined. It
was found that better performing firms (as rated by the firms themselves) exhibited a
greater number of products, had more customers, greater sales volume, had specified
show objectives and used fewer horizontal shows (broad-based end user audience)
and more vertical shows (narrow end user audience) .
Personal selling is usually the largest single item in the business marketing
communications mix. Trade shows, like advertising, are typically viewed as
20
complementary to the direct selling activity. For example, trade shows uncover
previously unknown or inaccessible buying influences, can project a
favourable corporate image, can provide product information, generate qualified
leads for salespeople, handle customer complaints, etc. (Hutt and Speh, 1995). In
addition, trade shows are a popular medium for promoting products and services.
The most recently published figures indicate that more than 91,000 firms display
their wares to more than 31 million prospective buyers at some 8000 trade shows at a
cost of $7 billion annually (Cleaver, 1982).
The trade shows afford a unique opportunity to integrate and project a
coherent message to prospective and current customers through a firm's exhibit
structure, graphic displays, salesperson-customer interaction, collateral support
material, and product or service emphasis and demonstrations (Cavanaugh, 1976).
Through adroit event selection and product planning, a firm can use trade shows to
communicate its message to the right people about the right products at the right time
in the buying cycle (Bellizzi and Lipps, 1984).
Direct marketing is about making direct contact with existing and potential
customers to promote the products or services. Unlike media advertising, it enables
to target particular people with a personalized message. Direct marketing can be cost
effective and extremely powerful at generating sales, so it is ideal for small
businesses. It uses a variety of different methods. Direct mail, mailshots and
leafleting are widespread, and other forms of direct and integrated
communication are growing in popularity.
Telephone marketing, mobile marketing, email and texting offer more opportunities
to reach the target market4.
There are a lot of reasons to use direct marketing. According to Statistical Fact Book
(1993-1994), the percentage of adults spending $200 or more per year on
merchandise ordered through direct marketing rose from 16 to 21% in 1992. In fact,
more money is presently spent on direct marketing programs and solicitations than
on magazine or television advertising (Akaah, 1995).
21
Direct marketing allows companies to generate a response from targeted customers.
As a result, small businesses can focus their limited marketing resources where they
are most likely to get results. In addition, a direct marketing campaign with a clear
call to action can help companies boost their sales to existing customers, increase
customer loyalty, recapture old customers and generate new business. Whether the
companies are targeting business (b2b) customers or consumers, direct marketing can
deliver results. Choosing the right communication method is vital.
Advertising promotion is different from direct marketing promotion. Advertising and
promotion refer to activities undertaken to increase sales or enhance the image of a
product or business. It is used primarily to inform the customers about the new
product, persuade and encourage customers to switch to a different brand and remind
buyers where to find a product.
Promotional activities are important for maintaining customer traffic throughout
the market season-used early in the season to draw customers to business and
during the season to maintain customer traffic levels during slow periods (Dunn,
1995). There are many reasons to take advertising promotion. A business may want
to create awareness, customer interest or desire, or boost sales, build brand loyalty,
launch a new product and so on.
Brand-oriented advertising (e.g., non-price advertising) strengthens brand image,
causes greater awareness, differentiates products and builds brand equity (Aaker,
1991; Keller, 1993). Advertising may also signal product quality leading to an
increase in brand equity (Kirmani and Wright, 1989). Accordingly, several authors
have found advertising to have a positive and enduring effect on base sales (e.g.,
Dekimpe and Hanssens, 1999).
2.3 Marketing
From a purely theoretical perspective, marketing as a process ensures that all aspects
of a marketing program are presented in a consistent, simple, and disciplined manner.
The essence of marketing, then, becomes that of defining a target market and
22
developing the marketing mix that meets the wants and needs of the particular target
segment (Crittenden, 2005).
Marketing is generally considered to be fundamental to the development and
performance of firms (Narver, and Slater 1992), (Kohli and Kumar, 1993). But
marketing has changed significantly since it first emerged as a distinct business and
management phenomenon between the First and Second World Wars (Lindgreen, et
al 2004).
Marketing researchers argued the four Ps of the marketing mix became an
indisputable paradigm in academic research, the validity of which was taken for
granted (Grönroos, 1983). As noted by Shapiro, the marketing mix is truly bone of
the most powerful concepts ever developed for executives (Shapiro, 1985).
2.4 Marketing Mix and Sales Performance
Marketing efforts do not impact performance (product sales or market share)
independently of each other. Marketing mix activities need to be coordinated because
they interact to determine performance (Gatington, 1993). This will help managers to
take advantage of the complementarity and to avoid incompatibility between
marketing mix instruments given constraints by budget and the variables themselves.
Evidence from literature shows that, for example advertising effectiveness is
enhanced by the quality of the product(Gatington, 1993), Prior sales person contact
retail availability and higher or lower price depending on the advertising medium
(Prasad and Ring, 1976).
Sales call effectiveness increases with the use of samples and hand-outs in medical
marketing and with advertising, consumer price-sensitivity has been shown to be
affected by advertising Sometimes position advertising increasing price sensitivity
(Eskin and Baron, 1977), negative in other studies. This phenomenon was attributed
to amount of competitive reactions to advertising in the marketing (Gatington, 1984).
The 4P’s marketing mix have been criticized for ignoring the human factor, lack of
23
strategic dimension, offensive postures and lack of interactivity. The model is said to
reflect the sellers view rather than the buyer.
2.5 Marketing Strategies
Marketing strategies and tactics are connected with taking decisions on different
variables to influence mutually-satisfying exchange dealings and relationships.
Characteristically, marketers have different tools they can use; these include mega
marketing (Kotler, 1997) and also called 4Ps of product marketing (McCarthy,
2002). Marketing appears simple to describe, but very difficult to practice (Kotler
and Connor, 1997). In the service industry, the P’s increase to seven that is physical
evidence, process, and people (Bashan, 2011) Organizational leaders in many firms
have applied the so-called marketing concept, which may be easy or complex. The
marketing idea and variants like the total quality management concept for example,
are fundamentally concerned with satisfying customers’ needs and wants
beneficially.
Creating and implementing efficient and effective marketing strategies which
incorporate relevant dimensions of the marketing concept, engage the organic tasks
of selecting a target market (customers or clients) in which to operate and
implementing an efficient and effective marketing ingredient combination.
Marketing thought, with its practice, has been moving quickly into the service
industry (Kotler and Connor, 1997). Literature, in part, canters on the conversation of
whether physical product marketing is comparable to, or different from, the
marketing of service and concludes that the differences between physical product and
service might be a subject of emphasis rather than of nature or kind (Creveling,
2005).
According to (Schnars, 1991), marketing strategy has been a most important focus of
academic inquiry since the 1980s. There are number of definitions of marketing
strategy in the literature and such definitions reflect different viewpoints (Li et al.,
2000).
24
On the other hand, the consensus is that marketing strategy gives the avenue for
utilizing the resources of an organization in order to gain its set goals and objectives.
In general, marketing strategy deals with the adapting of marketing mix-functions to
environmental forces. It evolves from the interaction of the marketing mix elements
and the environmental factors (Li et al., 2000).
Therefore, the function of marketing strategy is to determine the nature, strength,
way, and interaction between the marketing mix- elements and the environmental
factors in particular circumstances (Jain and Punj, 2002). According to (McDonald,
1992), the aim of the development of an organization’s marketing strategy is to set
up, build, defend and maintain its competitive advantage. Decision-making judgment
is important in coping with environmental ambiguity and uncertainty in strategic
marketing (Brownie and Spender, 2005)
2.6 Marketing Theories
PESTEL Analysis
A PESTEL analysis is a framework or tool used by marketers to analyse and monitor
the macro-environmental (external marketing environment) factors that have an
impact on an organization. The result of which is used to identify threats and
weaknesses which is used in a SWOT analysis. PESTEL stands for: P – Political, E –
Economic, S – Social, T – Technological, and E – Environmental, and L – Legal
Boston Consulting Group Matrix theory
If you are working with a product portfolio you have a range of tools at your disposal
to determine how each one or a group of the products are doing. You could consider
using the Product Life Cycle but if you need a current “snap shot” of how the
products are doing you would benefit more from using the Boston Consulting Group
Matrix.
Back in 1968 a clever chap from Boston Consulting Group, Bruce Henderson,
created this chart to help organizations with the task of analyzing their product line
or portfolio. The matrix assesses products on two dimensions. The first dimension
25
looks at the products general level of growth within its market. The second
dimension then measures the product’s market share relative to the largest competitor
in the industry. Analyzing products in this way provides a useful insight into the
likely opportunities and problems with a particular product. Products are classified
into four distinct groups, Stars, Cash Cows, Problem Child and Dog.
Relevance of Boston Theory to the Study
Tigo Company falls under star group, since there is high growth of market share and
the business in general. There is an increase of customers in the last quarter of
September 2014 to December 2014 hence increase in market share. As the model
shows the growth of the business goes together with sales of products, Tigo has
increased a number of subscribers/market shares in 2014 where this goes with the
increase of sales and usage of products like Data, Voice and Tigo pesa. The TCRA
quarterly report of 2014 shows the increase of Tigo subscriber from 7million to
8million in a period of October 2014 to December 2014 as indicated in the table
below
Table 2.1: Subscribers per Operation
Source: TCRA Telecommunications statistics report 2014
2.7 Mobile Phone Industry in Tanzania
Mobile phone technology in Tanzania has been growing at an amazing pace in terms
of both the number of service providers as well as that of the users. Due to this
growth, the Tanzanian government through the act of Parliament (2003) established
the Tanzania Communication Regulatory Authority (TCRA) to regulate
communication and broadcasting activities.
26
By 2009, a total of six (6) mobile phone service providers were issued
communication licenses by TCRA. These providers are TIGO, Zanzibar Telecoms
(ZANTEL Mobile), Vodacom, Benson, TTCL (Mobile) and Celtic - now known as
Airtel. In addition to that, two fixed line companies i.e. Tanzania Tele-
Communication Limited (TTCL) and Zanzibar Telecoms (ZANTEL) have been
operating along with the existing mobile phone service providers. The table below
shows the 2009 status of mobile phone services.
Table 2.2: Growth of Mobile Market Industry
YEARS AIRTEL TIGO TTCL VODACOM ZANTEL TOTAL
2007 2,505,546 1,191,678 72,729 3,870,839 678,761 8,322857
2008 3,862,370 2,569,527 105,804 5,408,439 1,057,652 13,006,793
2009 4,910,359 4,178,089 115,681 6,883,661 1,378,595 17,469,486
Source: Calculated from the Operators Monthly Subscriber base reports compiled by
TCRA 2009
The rapid expansion of mobile phone usage in Tanzania has been triggered by a
highly competitive market and service diversification, with the operators now
providing different mobile phone services such as voice and message transmission,
data services, mobile financial services as well as value added service.
2.8 Empirical studies related to the problem
Wee and Chan, 1989 found that the pricing strategies and advertising appeals must
also be adapted to suit the consumer’s needs and tastes. Some studies measuring
customer attitude and perceptions towards marketing mix have been carried out in
Telecommunication industries where the significances of these studies measured
consumer views towards marketing practices.
In Tigo Telecom Company this can be seen by customers who perceive Tigo as
affordable, accessible and available. Also Tigo use comedian in advertisements so as
raise customers’ appeals on advertisements. For example in Tigo advertisements’ a
27
comedian Jota (Lucas Muriel) is used to deliver message and to raise awareness on
the products offered by Tigo Company.
Additionally, other study show the use of a combined predictor variables such as MO
measures (e.g. marketing as a guiding philosophy of business) and MP measures
(e.g. marketing as product promotion and positioning). The study discovered that
managers who emphasized MP activities had significantly better scores on the
measures of competitive advantage than those who emphasized selling or
production and also had greater sales volume, better profits and better return on
investment. (Asimov, 2000). In case of Tigo Company it uses both indicators say MP
measures and MO measures. The guiding philosophy of business used is 3A’s which
are affordability (cheap for everyone to consume), accessibility (the network and
services is accessible all over the country) and availability (the products are available
in the market like voucher).
Ferrell et al 2002, have broadly argued marketing strategy to be a concept built
on strong platform of segmentation, targeting and positioning. This is also true for
Tigo since it use the segmentation and positioning strategies. It segment its product
basing on target market that it has and position itself as the market require it to do so.
For example Tigo has positioned itself as a young and cool brand; most of its
customers are youth. Also the products are segmented basing on the customers’
needs say, average revenue per user (ARPU).
Marketing strategy requires decisions about the specific target of customers. Besides,
marketing mix may be developed to target market by positioning it suitably in
a superior way. In this context, the study of the effectiveness of the marketing
mix is essential for an appropriate marketing strategy. Appropriateness of
marketing strategies may be viewed as the similarity of market offerings of a
set of products and its corresponding consumer perception among its target
segment. More the target segment is able to understand and believe the indications
communicated by the firms through marketing mix more are the effectiveness of the
marketing strategies (Richardson, 1994). For Tigo Company the marketing strategy
28
used is top of mind brand, where all customers even those who are not using Tigo
products they know about the brand.
Despite the consistent effort by many physical businesses to deal with the 4P in an
integrated manner, the drafting but mainly the implementation of the policies
remains largely the task of various departments and persons within the organisation.
Even more significant thought is the fact that the customer is typically experiencing
the individual effects of each of the 4Ps in diverse occasions, times and places, even
in case that some companies take great pains to fully integrate their marketing
activities internally (Constantine’s, 2002; Wang et al, 2005). For the case of Tigo
Company this also applies to customers. It is difficult to integrate the 4P’s in diverse
occasion hence customers face the effect of each of the 4P’sfor example not all
customers can benefit the effects of Promotion at once, especially those who are
living in villages. Also some advertisements’ especial the television advertisements’
may not be seen by customers living in villages.
The introductory marketing texts suggest that all parts of the marketing mix (4Ps) are
equally important, since absence in any one can mean failure (Kellerman et al ,
1995). This is also true for Tigo Company since these 4Ps depend on one another.
Example in absence of promotion the market share drops very fast because Tigo sell
much basing on advertisements’ and promotion offered.
Number of studies of industrial marketers and purchasers indicated that the
marketing mix components differ significantly in importance (Burdick and Keith,
1985). Two surveys focused on determination of key marketing policies and
procedures common to successful manufacturing firms determined that these key
policies and procedures included those related to product efforts and sales efforts.
This followed in order by promotion, price, and place.
In a replication of this survey, Robicheaux (1976) found that key marketing policies
had changed significantly. Pricing was considered the most important marketing
activity.
29
Although it ranked only sixth in Udell’s survey (1968), it found that sales efforts
were rated as most important, followed by product efforts, pricing, and distribution.
For Tigo this is different, the system starts with product, where the Company
identifies what it sells. Then Pricing, the Company make sure that the price is
reasonable compared to the prices of competitors then communication follows
(promotion), the company communicates what it have to the customers at different
places. (Place)
LaLonde (1977) found product related criteria to be most important, followed by
distribution, price, and promotion. This differs from Tigo since product is followed
by price then promotion then place.
Perreault and Russ (1976) found that product quality was considered most important,
followed by distribution service and price. McDaniel and Hise, (1984) found that
chief executive officers judge two of the 4 Ps, pricing and product to be somewhat
more important than the other two place (physical distribution) and promotion. This
literature differs from Tigo system because Tigo considers all elements to be of the
same importance but in application some elements starts.
Kurtz and Boone, (1987) found that on the average, business persons ranked the 4 Ps
to be of most importance in the following order: price, product, distribution, and
promotion. Thus, it appears from these studies that business executives do not really
view the 4 Ps as being equally important, but consider the price and product
components to be the most important.
The concept of 4Ps has been criticised as being a production-oriented definition of
marketing, and not a customer-oriented (Popovic, 2006). It is referred to as a
marketing management perspective. Lauterborn (1990) claims that each of these
variables should also be seen from a consumer’s perspective. This transformation is
accomplished by converting product into customer solution, price into cost to the
customer, place into convenience, and promotion into communication.
30
2.9 Conceptual Framework
According to Smyth (2004) Conceptual frame work is a written or visual
presentation that explains either graphically or in narrative form, Reichel & Ramey,
(1987). Added that a conceptual framework is a set of broad ideas and principles
taken from relevant fields of enquiry and used to structure a subsequent presentation,
Conceptual framework, sometimes is referred to as a theoretical framework, is a type
of intermediate theory that attempts to connect to all aspects of inquiry such as
problem definition, objectives, literature review, methodology, data collection and
analysis. Conceptual frameworks can act like a map that gives coherence to empirical
inquiry. Because conceptual framework is potentially so close to empirical inquiry, it
takes different forms depending upon the research question or problem. In this
proposal, the researcher has developed a theory that illustrates dependent,
intermediate and independent variables.
Figure 2.2: Illustrative Diagram to Conceptual frame work
.
Source: researcher, 2015
Explanation of the model
From the model independent variables are expressed by marketing mix elements, and
independent variables are expressed by sales performance variables. Marketing
Sales performance
indicators
- Increase of
sales
- Decrease of
sales
- Marketing
policy
- Competitio
n level
Marketing mix
indicators
Prices/discount
Product
Promotion
Place/Location
Independent variable Intervening variables Dependent
variable
31
policy and competition level express intervening variables. It is assumed that from
the model when the price is affordable, product packages are of high volume and
there is special offer of unlimited packages, promotions are intensive and products
are accessible in all places with favourable marketing policy and low level of
competition then the sales performance tends to increase. On the other hand when the
prices are high compared to that of competitors, products packages are low, no
intensive promotions and advertisements’ with unfavourable marketing policy and
high level of competition then the performance of sales tends to be low.
The indicators of each variable are defined in appendix 3
2.10 Research Gap
Marketing mix management paradigm has dominated marketing since 1940s and
McCarthy (1964) further developed his idea and refined the principle to what is
generally known today as the 4Ps. However, in the post dot-com boom, marketing
managers are learning to cope with a whole host of new marketing elements that
have emerged from the online world of the Internet. In some ways these new
marketing elements have close analogues in the offline world, and yet from another
perspective they are revolutionary and worthy of a new characterisation into the E-
Marketing mix (or the e-marketing delta to the traditional marketing mix).
(Kalyanam and McIntyre, 2002), Marketing mix used by a particular firm will vary
according to its resources, market conditions and changing needs of clients. The
importance of some elements within the marketing mix will vary at any one point in
time. Decisions cannot be made on one element of the marketing mix without
considering its impact on other elements; therefore a researcher looked on the
impacts of the elements of marketing mix based on customer’s side. That is the
impacts of marketing mix element on customers.
As McCarthy (1960) pointed out that “the number of possible strategies of the
marketing mix is infinite. Even number of criticisms on 4Ps, however, it has been
extremely influential in informing the development of both marketing theory and
32
practise. There is also too little reflection on the theoretical foundations of the
normative advice found in abundance in the text books. Marketing mix was
particularly useful in the early days of the marketing concept when physical products
represented a larger portion of the economy.
From the literatures, most of the authors discussed that the marketing mix elements
has priorities in the way they apply. Therefore the researcher explained how
marketing mix (4P’s) are used by the Tigo telecom firm in Tanzania and determined
if the elements were applied in priorities as discussed by other researchers.
Also basing on the literatures, the marketing mix has influence on sales performance;
therefore this study intended to assess the effects of 4ps in marketing mix on sale
performance in Tigo telecoms firm. Dar es Salaam town was selected as a study area
where information was collected from.
33
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Introduction
The purpose of this chapter was to identify the appropriate methodology that was
used during the study. The methodology demonstrated the entire process of this
study, as well as analysis of the various research methods employed during the
conduct of the research. It highlights the study design, area of the study, research
approach, sampling and sampling procedures, data collection and data analysis. This,
in different ways enabled the study to achieve the research objectives and questions
that guided the study.
3.1.1 Research Design
Research design is a systematic planning, organizing and executing a research within
specified time and resource limits. It tells type of data to be collected (primary or
secondary), the source of and the procedures to be followed in data collection.
Research design provides suitable framework that guides the collection and analysis
of data. Also, Ghauri and Gronhang (2005) talk of a research design as a plan
outlining how information is to be gathered for an assessment or evaluation that
includes identifying the data, how to administer the instruments and how to organize
the information and lastly how to analyze data.
This study employed case study design, simply because it allowed a researcher to
collect data only in one organization and made deep investigation study on the
problem in question. A part from that, case study was not cost full compared to other
research design. It also involved both quantitative and qualitative data collection.
3.2 Area of the Study
This study was carried out in Dar es Salaam city. The research study investigated the
effectiveness of marketing mix in sales performance in Tigo Telecom Company.
34
This was because Tigo head offices are allocated in Dar es Salaam and it has many
shops in Dar es Salaam compared to other regions.
3.3 Research Approach
For the better result, the study combined qualitative and quantitative approaches.
Participatory approach was employed as qualitative design. Semi structured
interviews with key informants, in-depth interviews and documentary review
methods were triangulated in order to allow new insight. The method helped to
obtain information that was not emerged from survey approach (Mbwambo, 2002).
3.4 Population, Sampling Design and Sampling procedures
The section involved three areas. Firstly, the target population i.e. the group of which
information sought have been specified. Secondly, the method for selecting the
sample developed (Sampling Techniques) and thirdly, the sample size was
determined.
3.5 Sample Size and Sampling Techniques
3.5.1 Research Sample size
Since it was difficult to collect data from every individual, the researcher used
representatives (sample) of the population. A total of 50 respondents’ were
consulted.
Table 3.1: Distribution of Respondents
Respondents Category Number of Respondents % of respondents
Tigo Staff 20 40%
Tigo Customers 30 60%
Total 50 100%
Source: Researcher proposed sample 2015
3.5.2 Sampling Techniques
35
Stratified Sampling Technique
Stratified sampling is a probability sampling technique wherein the researcher
divides the entire population into different subgroups or strata, then randomly selects
the final subjects proportionally from the different strata.
A random sample from each stratum was taken in a number proportional to the
stratum's size where it was compared to the population. These subsets of the strata
were then pooled to form a random sample. Therefore a researcher divided the
number of sample in relations to departments as well as number of Tigo shops in Dar
es Salaam so as to get the target sample to answer the questions.
The reasons why a researcher used Stratified sampling technique was: This
technique produce a smaller error of estimation than would be produced by a simple
random sample of the same size, also the cost per observation in the survey could be
reduced by stratification of the population elements into convenient groupings lastly
estimates of population parameters was desired for subgroups of the population.
3.6 Source of Data
This involved collecting primary and secondary data. Primary data was collected
during the research study. Questionnaire/Survey, Interviews and documentary review
were employed as the primary data collection methods while documentary review
was helpful to obtain secondary data.
3.6.1 Primary Data Collection
Questionnaires
A questionnaire is one of the tools that were used in data collection process. Most of
the questions included in the questionnaire were closed ended questions. The main
theme behind using this type of questions was to simplify the process of responding
to the questions. Also, closed questions were easy to interpret and provide strait
meaning to data. Finally, these questions fit better the extraction of statistical
information, which were the main theme of the study.
36
Interviews
In-depth and Semi-structure interview were among of the methods employed during
data collection. Respondents from Tigo were interviewed and their information’s was
quickly obtained. This eliminated unrealistic ideas and variables. Part of the
information collected here were those related with certain situations, feelings,
perceptions and clarifications on issues observed in the questionnaire.
This was useful since interviews obtained detailed information about personal
feelings; perceptions and opinions. Respondents allowed more detailed questions to
be asked. They achieved a high response rate.
Documentary Review
Documentary review was another method that was employed in obtaining data from
different publications. Documents such as Tigo annual and Tigo semiannual reports
that show the plan and their strategies was helpful in establishing the model and
making a trend analysis of different issues arising in the study.The researcher used
check list and compilation forms in the process of identifying and grouping data
relevant for the study. This was helpful in making comparison so as to establish
different facts on stock market in developing countries in Tigo telecom.
3.7 Reliability and Validity of Data
Credibility of research findings relies on the attention paid to two particular
emphases on research design: reliability and validity (Saunders et al, 2000 p.100). In
this study, reliability and validity aspects was handled with great concern to avoid
getting wrong answers to research question and objectives.
3.7.1 Reliability
This refers to how consistent or stable the ratings generated by the scale are. It entails
that the measure or data collection methods shall be influenced by changes in
context. The validity of information collected is seen in the extent to which the
methods were used to pick up what researcher expected them to (Edwards and
Talbot, 1994 p.70). Reliability of the measures ensured that all questionnaires and
interview guide were uniform to both respondents. The collected data was processed
37
in a uniform way to ensure that, the conclusion reached was similar to any other
study that was conducted in similar approach. No research assistant employed in this
study. Different method of data collection, questionnaire, interview and documentary
review resulted to high level of triangulation which in turn ensured reliability of the
data collected.
3.7.2 Validity
It is important to test for validity because, despite the fact that internal consistence of
the scale is necessary condition for validity, it is not sufficient evidence of the
validity (Churchill, 1999). Validity is concerned with whether the findings are really
about what they appear to be about (Saunders et al, 2000 p. 101). Validity of the
measures was ensured by analyzing data and making pilot tests of the questionnaire
before, within and after field work. For example, the number of data and reviews
collected from one branch using questionnaires matched with those obtained from
another branch. Thorough data cleaning was done after the field work.
3.8 Data Presentation and Analysis
Data analysis involves scrutinizing the required information and making inferences
(Kombo and Tromp, 2006 p.117). Qualitative data was analyzed by summarizing the
findings and explanations and there of using categorized and direct quotations to
present the findings and generate attributions and other findings will be presented
based on the respondent’s perceptions. Quantitative data was coded and analyzed in
the form of tables, percentages and simple statistical measures calculated using
spreadsheet formulas. The processes of interpretation based on inferential statistical
methods obtained by the use of SPSS (Scientific Package for Social Science) Version
20 or Microsoft office excel 2007. Analysis of variance and independent samples t-
test techniques was used with regard to variables influencing the respondents.
Basically, data analysis and interpretations enabled the researcher to address the
research problem, derive conclusions and eventually recommended possible market
implications and actions in a constructive manner.
38
CHAPTER FOUR
RESULTS AND DISCUSSION
4.1 Introduction
This chapter presents the research results from the field and theoretical propositions
basing on the predetermined research objectives and questions. The chapter analyses
the effect of marketing mix and its impact to sales performance in Telecom Business
Company a case of Tigo Telecom Company. Primary data presented in this chapter
was collected through questionnaires, observation and interviews. Secondary data
were collected through reviewing of existing literatures.
4.2 Demographics information
Tanzania has a Population of 44,928,923 people; this was reported on 2012
Population and Housing Census report. Where in Tanzania Tigo has almost 11m of
subscribers which is 24% of the population, and most of these Tigo customers are
found in town areas, This was easy shown by Dar es Salaam on of the region that is a
strong hold of Tigo company, it has almost 4m subscribers and the reports show the
gender demographic information of Dar es Salaam Tigo subscribers as table below
shows.
Table 4.2.1 Dar es Salaam Tigo Subscribers Demographic information: Gender
Gender
Male Female
54% 46%
Source: Market Share Report, 2015
The table above present the demographic information of the total subscriber base of
Dar es Salaam where 46% of the subscribers are women and men are 54%. This
shows that mobile phone penetration is high compared to women who own mobile
39
phone in Dar es Salaam. However as GSMA reports indicates that mobile penetration
in the society is highly to men where the report shows that many men owns mobile
phone than women. But this can be bit challenged in some areas especially in town
areas where number of women who own mobile phone is higher that the number of
women who own mobile rural areas.
Figure 4.1: Demographics Information: Gender
Source: Field Data 2015
The researcher findings shows that among of the Tigo customers who were
responding to this questions majority were women (64%) and men were 36%. The
reason why women number happened to be high than men is because women were
willingly to participate in this study compared to men. While, in the other group of
respondents of Tigo staffs who were part of the respondents to this study half of them
were male (50%) and half of them were Female (50%).
Figure 4.2: Demographics information: Age
Source: Field Data 2015
36%
64%
50% 50%
Male Female
Customer Tigo Staff
6%
51%
35%
7%0%
51%45%
4%
16 – 21 Yrs 22 – 30 Yrs 31 – 35 Yrs 36 – 45 Yrs
Customer Tigo Staff
40
The graph presents age distribution among the respondents of the study. A researcher
found out that Tigo customers were in all group range from 16-45years (16%) which
is an ideal age for a young age people to own mobile phone, while Tigo staff did not
have respondent with age range 16-21years (0%) and this is obvious for the company
and employment industry in general to employ people of that age is impossible.
However, age group between 22-30years a researcher found 51% of customer are
belonging on that age group as well as 51% of Tigo staff, and 35% of Tigo customer
and 45% of Tigo staff were belonging on age group between 31-35years. These two
groups includes large number of Tigo staff as well as Tigo customers who are the
respondents in this study, this implies that the majority of this age group own mobile
phones and also are the employed people in the society. The results of this research
can be verified with what was founded in Tigo Market Share report of 2015 that
showed on the Table 4.2.2 of Dar es Salaam Tigo Subscribers Demographic
information shows majority of Tigo customers their age range between 16years to
35 years.
Table 4.2.2 Dar es Salaam Tigo Subscribers Demographic information: Age
Tigo Age
16 – 21
Years
22 – 27
Years
28 -- 33
Years
34 -- 39
Years
40 -- 45
Years
46 and
above
Dar es Salaam 21% 25% 29% 10% 10% 5%
Source: Market Share Report, 2015
The table above emphasis more on what was founded by a researcher during the field
where customers below 21years are 21%, and 64% of subscriber who has age range
between 22-39years where customers above 40years are only 15%. This implies that
majority of Tigo customers are age group between 22years to 40years where at this
age group you can find students, entrepreneurs, employed people and all people who
are able to pay mobile phones bills, they are the ones who generate income so they
can also generate profit to the Tigo Company.
41
4.3 Influence of Product consideration on Sales performance
4.3.1 Relationship between Product consideration and sales performance
During the field, a researcher had few attributes that shows what do customer
consider in the product that they want to buy, these attributes includes types of the
product, validity of the product, if competitors don’t offer such product, price of the
product, demand of the product in the market and customer experience on the
product. A researcher found out that there is a significant relationship between
product consideration and sales performance where if the customers are in high
demand of such product in the market the sales performance will be high while if the
demand is low in the market sales performance will decrease.
In the findings that were addressed in this report, Tigo staff shared the reasons why
customers preferred such products. In general, Affordable price and Good offers
were highly rated as the reasons why customer preferred such product. The products
which were mentioned more than once is Data and Packages. This is one of the
attribute that a researcher had during the session of data collection, so this findings
show the relationship between what customers consider when the want to buy Tigo
product that leads to sales performance.
Moreover, high demand of the product in the market and promotions were second
highly ranked as reasons why customer prefer Tigo product. Also, in this study we
have found that customer buy Tigo Music because competitors do not offer that kind
of product.
Basing on the indicators, the study showed the significance of the required
relationship in based on the statistics provided and frequency of responses of the
respondents.
42
Table 4.3.1 Significance of Product Consideration on Sales performance
Level of Significances Frequency
(N=50)
Frequency in (%)
High 40 80%
Medium 7 14%
Low 3 6%
Not Applicable 0 0%
Source: Field Data 2015
Table 4.3.1 present the research findings that shows the levels of relationship
between product consideration and sales performance in the Tigo Company. Out of
50 respondents who respond to this question 40 who are equivalent to 80% of all the
sample say there is “High relationship between product consideration and sales
performance”, while 7 respondent which are equivalent to 14% of the sample say
there is a “medium relationship between product consideration and sales
performance” and 3 respondent who are equivalent to 6% of the sample say that
“There is low relationship between product consideration and sales performance in
the Tigo Company”
On the other hand, a researcher found that the reasons why customer make
considerations before making decisions on what product to buy from the Tigo
company including for them being own more than one SIM card (multi SIMmers).
Majority of the Dar es Salaam dwellers are multi SIM users that makes them to have
comparison whenever they want to buy Telecom products. Also, a researcher observe
that majority of them use Tigo as a main SIM that makes them to buy more Tigo
products as they use more that SIM compared to those who use Tigo as secondary
SIM.
However respondents spot another reasons why they consider before buying Tigo
products is; as a service provider, Tigo is also offering customers the opportunity to
purchase affordable smartphones, providing them with the best internet experience
43
and free access to a number of educational, health, news and social communication
sites via the Internet.org app. These are the services that are not offered by the other
service provider, so give customer a wider range when they want to buy telecom
product to choose Tigo products hence performance of sales in the company.
Also, when the products exceed the customers’ expectation here customer discussed
on Customer experience over a certain product example Tigo Internet, then the
customers will be satisfied. By having the customers’ satisfaction, it can increase the
sales volume of the company. Tigo is responding to what our customers want as a
key to our success. They operate in high-growth developing markets where
consumers want the same digital lifestyle that their peers in more developed markets
already enjoy. It is no longer a conversation about megabytes but about what services
customers want.
A recent report by the Tanzania Communications Regulatory Authority (TCRA)
shows that the number of internet users in Tanzania has increased from 7.5 million in
2012 to 9.3 million by June 2014 - equivalent to 18% penetration. The design of the
Telecom products such as validity of the package (if package last for a long time
compared to competitors package) it’s obvious that the product will be highly
demanded hence sales performance will rise.
Below is a graph that show Product usage Vs. Product sales, this explain more the
relationship of what customer use and what Tigo staff sale. This emphasise more on
the sales performance of the Tigo Company in relation to what customer buy.
44
Figure 4.3.1 Product usage Vs. Product sales
Source: Field Data 2015
Data from Figure 4.3.1 above show the relationship between product usage among
Tigo customers and the sales of individual Tigo staff, the study found out that the
sale of Tigo Pesa (75%) is equal to the use of it (75%), as the sales is same as to
SMS which is 50% to 50%. While the sale of Voice has difference of 25% compared
to what customer use, the difference can be covered by the presence of retail shops,
Tigo Rusha vendors who offer the same service in the streets. This can be applied to
use of data which is 50% vs. sales of data which is 50%, purchasing options of this
service is available online where customer can buy himself or bought by friends
which founded more convenient to Tigo customers.
4.4 The Extent to which Price affect Sales performance
4.4.1 Relationship between price and sales volume
There are many factors that can determine the flow of a business which can affect the
changes in the performance of a business from time to time. Pricing is one of the
elements of the marketing mix that is owned by multiple groups within a company.
The pricing decisions must be viewed as an interactive process.
75%
100%
50% 50%
0% 0% 0% 0%13%
75% 75%
100%
50%
75%
50% 50%
0% 0%
Tigo
Pesa
Voice Data SMS VAS RBT Tigo
Music
Tigo
Bima
Others
Customer Tigo Staff
45
According to Kotler (2006:570), “Sales Volume is the quantity or number of goods
sold or services rendered in the normal operations of a firm in a specified period.”
Therefore, the relationship between Pricing Strategy and Sales Volume is as follow:
SALES VOLUME (Y) PRICING STRATEGY (X) Figure 1 NOTE: X =
Independent variable (pricing strategy) Y = Dependent variable (sales volume)
Pricing is one of the effective ways to increase and maintain the sales, especially the
sales volume of the company. According to Kotler (2005, P.301) “Pricing has been a
major competitive weapon employed by Asian business. Their low cost positions
have provided the basis upon which they have priced aggressively to gain market
share both within and outside the region.”
Tigo has been applied this strategy where they price its product lowly compared to
what their competitors price their products. This strategy help Tigo to exist in the
market and for many Coastal zone customer to use it as a main SIM where
Affordable price these has been their success story to them as they experience
gradual increase of their revenue since 2011 to 2014. Table 4.4.1 Income Statement
of Tigo shows the trend of increase of the company income in general.
Table 4.4.1 Income Statement of Tigo
Attributes 2014
US $m
2013
US $m
2012
US $m
Revenue 6,386 4,390 4,136
Cost of Sales 2,522 1,723 1,539
Gross Profit 3,864 2,667 2,597
Source: Millicom Annual Report, 2014
The table above show the increase of revenue of the company where between 2012
and 2013 a company gain USD 256m, and also within the period of 2013 - 2014
company gain USD 1996m. The difference between year 2012-2013 and 2013-2014
is the sales of a products which went hand in hand with the low price strategy of a
company that resulted to an increase of sales.
46
Today, most of the consumers would like to search for the operators who have lower
price than the other ones that can really satisfy their needs and wants, either in the
taste of the product or the price of the product.
Basing on the findings respondents was able to show in what extent price affect sales
performance. These findings validate this assumption where majority say to large
extent price affect sales performance.
Table 4.4.2 to what extent price influence customer to buy product
Attribute Respondent (N=50) Respondent in (%)
To larger extent 24 48%
To some extent 16 32%
Not applicable 10 20%
Total 50 100%
Source: Field Data 2015
The research findings show that customers and sellers are very sensitive in price.
This may be the big factor that majority of the customers use for making buying
decisions. The results shows that 48% say to large extent price influence customer to
buy product, 32% say to some extent price influence customer to buy product whilst
20% say price influence is not applicable when customer wants to buy product.
This implies that, majority of Tigo customers who are price conscious are belonging
to the mid and Low ARPU group. A researcher found out that whenever there is a
price change in the market buying behaviour of this customer change. Also a
researcher found that these customers can stop buying the product when price is
high. Moreover, the highbred users of Tigo products are the ones who can have slight
change of buying product whenever there is price change. These are the ones who
say to some extent price influence customer to buy products. Most of these
customers are the primary users of Tigo SIM. However, there are other customer
who say price influence is not applicable in buying products. Most of these customer
are corporate customers and High ARPU customers, they believe in quality of
47
service that they get from their service provider. They are willing to pay any amount
of money as long as the product they are paying for has the same value with the price
that they pay.
By going further deeper, a researcher was able to find more insights from the study
where respondents were able to identify in which specific product price influences
them to buy Tigo products.
Table 4.4.3 To what extent price influence customer to buy product
Types of
Product
To large
extent %
To some
extent %
Not
Applicable %
Tigo Pesa 8 33% 7 44% 1 10%
Voice 3 13% 0 0% 1 10%
Data 4 17% 3 19% 1 10%
SMS 1 4% 3 19% 1 10%
VAS 0 0% 0 0% 1 10%
RBT 0 0% 0 0% 1 10%
Packages 5 21% 0 0% 1 10%
Tigo Music 0 0% 1 6% 1 10%
Tigo Bima 0 0% 1 6% 1 10%
Others 0 0% 1 6% 1 10%
Total 24 100% 16 100% 10 100%
Source: Field Data 2015
Data from Table 4.4.3 shows that majority of respondent say “To large Extent” price
influence customer to buy Tigo product where Tigo Pesa was highly ranked as a
product that customer are influenced by its price by 33%, Data 17%, Packages 21%
and Voice 13% where those who said “To some extent” ranked Tigo pesa 44%, Data
19%, SMS 19%, Tigo Music 6%, Tigo Bima 6% and other products 6%.
48
Results found out that Price is a sensitive indicator that drive sales of a company to
have a gradual change of whether increase of decrease. The observation of a
researcher shows that most of the Dar es Salaam customers are multi SIM (they have
more than one SIM card) but they use Tigo as a primary line but if there is a change
of price customer tend to compare with other operators, hence the sales performance
change depend on the price change.
During the interview a researcher found that Tigo Pesa was highly rated as product
that are used most and preferred by Tigo customers, followed by Data then Voice.
However, VAS, RBT, Tigo Bima and Tigo Music seemed neither preferred nor to be
most used by customer. The reason behind this probably is because they have options
against this service, as they mostly use data so for them to access YouTube for
listening/watching to music as an optional to Tigo Music and RBT, access to
websites as optional to VAS.
It is understood that price plays a crucial role in the consumer’s 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.
However, Tigo has been perceived as an operator who has best price (Affordable) to
their customer. This is because of the strategies that Tigo used in some years back
where they used to have offers and packages that allow customer to call all day only
for 1500. So these strategies and campaign has stacked to the customers mind and
perceived Tigo as affordable operator which is good to the company.
4.5 Effects of Promotion in sales performance
This study also focused on understanding the effect of promotion in sales
performances of Tigo telecom firm where the respondent clarify that with the
increasing of competition in the Telecommunication market, organisation has been
prompted to be resolute and ensure satisfaction of customer needs and wants more
49
efficiently and effectively than ones competitors hence they are supposed to come
with promotion ideas so as to increase sales.
The market has become very competitive in the recent days due to the growth in
technology, innovation and creativity in telecom industry. This has made the market
very complex and consumer preferences keep changing because of the low switching
cost in the usage. 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).
A researcher found out that Tigo staff come with two factors that will influence
customer to respond into the promotion offered by Tigo Telecom company, these
factor include Pull Theory “The Pull factor” which is about trying to market directly
to customers to increase their demand for your product. Advertising and links with
other products or services is the key to this strategy.
The factor 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
products. The second factor is “Push Factor” using this 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 products 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
When the respondents respond to this objective, a researcher found the important
information where Tigo customers confirm what Tigo staff were responding to this
objective, these findings show the relationship of the customer promotion preference
with what Tigo promotions that sales most.
50
Table 4.5.1 Significance of Promotion in Sales Performance
Promo preferred Promo sales most
Types of
Promotion
Frequency
(N=30) %
Types of
Promotion
Frequency
(N=20) %
Smartphone
offer 8 27% Smartphone offer 8 40%
Acquisition 5 17% Acquisition 3 15%
Corporate
Package 6 20%
Corporate
Package 3 15%
Post Paid offer 4 13% Post Paid offer 2 10%
4G Offer 4 13% 4G Offer 2 10%
Prepaid Offers 3 10% Prepaid Offers 2 10%
Total 30 100% Total 20 100%
Source, Field Data 2015
The study also found out that the promotions which preferred by customers are
Smartphones offers 27%, Acquisition offers 17%, Corporate packages 20%, Post-
paid offers 13%, 4G offers 13% and Prepaid offers 10% where the researcher found
that the customer promotions preference is almost the same as what Tigo staff
respond that they are preferred promotion by customers due to the experience they
had in the market where Smartphones offer 40%, Acquisition offers 15%, Corporate
packages 15%, Post-paid offers 10%, 4G offers 10% and Pre paid offers 10%.
The research findings shows that there is a positive relationship between the effect of
promotion and sales performance. Where the effect of promotion in the market led
the increase of sales in the market hence the increase of sales in the company.
Generally, a researcher found that promotions add basic value to the product where
customer get stimulated and change their purchasing behaviour to the high one hence
the increase of sales.
51
Example: Free Facebook was the promotion that conducted by Tigo in mid of 2014
to date that resulted to the increase revenue due to the increase of data /internet users
and smartphone users who contribute much when they purchase data.
Demand for data is having a significant impact on industry. Affordable smartphones
are making the mobile internet accessible for millions who have never before been
online. Consumers no longer need to wait for a fixed connection to access the digital
world. Better mobile coverage makes everything possible. Meanwhile, the
development of mobile phone applications to educate, entertain, communicate and
make payments empowers consumers and societies. A recent report by the Tanzania
Communications Regulatory Authority (TCRA) shows that the number of internet
users in Tanzania has increased from 7.5 million in 2012 to 9.3 million by June 2014
- equivalent to 18% penetration.
Therefore, the researcher conclude that the effect of promotion in sales performance
will be ether sales performance to increase when the promotion is good to customer
or to decrease if the promotion is not attractive to customers. However, as
promotions tend to change customer buying behaviour it also can be used to retain
customers who threatens to churn.
52
4.6 Effect of Place on Sales Performance
Figure 4.6.1: Where do you sell Tigo Products?
Distribution Channel Frequency (N=50) %
Tigo Shops 10 20%
Freelancers 2 4%
Kiosk 1 2%
On umbrellas in the street 7 14%
Wakalas 3 6%
Online (*148*00#) 9 18%
Key Account Managers 16 32%
Direct sales 1 2%
Indirect sales 1 2%
Total 50 100%
Source: Field Data 2015
This study identified channel of distributions where Tigo staff used for selling Tigo
Products. The results showed that Key accounts managers 32%, Tigo shops 20%,
online (through USSD numbers) 18% and on the Tigo umbrellas along the street
14% are the channel that mentioned by the majority of the respondents during the
field of this research. Other channels or sales distribution channels includes direct
sales 2%, indirect sales 2%, kiosk 2% and freelancer 2%.
This study also identify product that are sold in the channel of distributions where
Tigo staff used for selling Tigo Products. The results showed that Key accounts
managers, Tigo shops, online (through USSD numbers) and on the Tigo umbrellas
along the street sell almost all products where other channels of distribution sell few
different products The study showed that direct sales, indirect sales, kiosk and
freelancer sell only Tigo Pesa and no other Tigo Products.
53
However, direct sales and indirect sales involve the super dealers and the company
itself where Tigo (the company itself) sell a product to super dealers at affordable
price then super- dealers distribute the products to the retail/customers, example of
these products include Tigo Pesa Tills, Vouchers, Epin and Smartphones
Majority of Tigo customers among those who participated on this study seemed to
use online as a way of buy Tigo Products. This is easy for them as it is convenient to
customer it does not require much time to do it. Most of the services which are
available online include buying packages, send and receive money through Tigo Pesa
as well as transferring money to bank account, where Tigo Pesa was bought in all
channel of distribution and this was the product which was highly mentioned by the
respondent due to its importance in daily life, Tigo MFS usage (Mobile Financial
Services) nowadays has penetration of 51% in Dar es Salaam only. As customer are
not using or preferring Tigo Bima, Tigo Music, RBT and VAS no channel of
distribution were mentioned as they do not use those products.
54
4.6 Factors influencing sales performance in Tigo Telecom Company
The table below present the factors that were mentioned randomly by the Tigo staff
during the interview of this study. This also involve the strategy that Tigo company
use to design and push the product in the market hence to increase sales of a
company.
Table 4.6.1 Factors influencing Sales Performance in Tigo Telecom Company
Product Plac
e
Price Promotion
Product
uniqueness
High
sales
Directly
to
custom
ers-
Tigo
shops
Penetrating price
Customer discounts
Brand
Retailers-
WAKALAs
Affordable price Smartphone Fairs
Volume
of the
packages
Wholesale
rs
Competitive price Bonus/Incentives to
customers
Availability
Distributo
rs
Product price
Promotio
n type
Push
Customer
needs and
Demand
Number of Tigo
Shops
Tigo Pesa Charges
Pull
Tagline
“Tigo
Tumefika”
Custome
r type
Private
customer
Competitor
don’t offer
such product
Corporate
customer
Advertisi
ng
method
Roadshows
Product
packaging
uniqueness
Ways
of
purch
asing
Online
TVC/Radi
os with a
strong
Character
(Joti)
Freelancer
s
Online Advertising frequency Source: Field Data 2015
55
Table 4.6.1 shows the factors that mentioned by Tigo staff who were part of the
respondents in this study.
Factors that belong to the Product show that product uniqueness, volume of the
package, availability of the product in the market, demand of the product in the
market are among of the factors that drive customers to buy Tigo products hence
increase of sales performance. However, Brand as brand prestige or popularity of the
brand in the market, and when competitor doesn’t offer the same product are the
factors that make a customer not to have other option when buying Tigo Product.
Price seem to be a big factors that customers can use in making decision whether to
buy Tigo products or not to buy Tigo products. Also the change of price in the
market can easily show the change of revenue whether the increase or decrease of
revenue in the company. When price increase the demand of the product decrease
especially for Tigo customer who use Tigo as secondary SIM they do not bother to
buy Tigo product for the secondary use. “When there is a price change in the market
you can see the decrease of revenue in Low ARPU category who are the Tigo
secondary SIM users”…said one of the Tigo staff.
Place is a bridge and channel of distribution that connect customer and seller of a
product. Tigo Company has a several ways of distributing its product to the
customer. There is a physical way and online way of getting Tigo products whenever
you want to access Tigo services. “We have the advanced way of selling our
products; we want our customer to have convenient and accessibility to our products
whenever they are.” Said Tigo staff from Technical department when he was
explaining one of the distribution methods of Tigo products.
There is online way that customer can use to access and buy Tigo product which is
Tigo Pesa by dialling USSD Code and buying Packages also by dialling USSD Code.
Also, Tigo has Tigo shops in different regions; however in some regions most big
regions where they have many customers Tigo has more than one Tigo shops so that
their customers will be able to get services at the nearest places from where they
stay. Example, in Dar es Salaam Tigo has 13 Tigo shops and this is allocated in all
56
district and populated areas like Mbagala, Manzese and Tegeta where these shops
accommodate almost 1500 customers a day on average.
In additional to that, Tigo also have indirect channel of distribution where super
dealers sell Tigo products and services on behalf of Tigo company, example of the
product that are sold by super dealers are vouchers, E-pin and Tigo Pesa TILL. There
also corporate customers who are taking cared by Key account managers.
Promotion, this is the element that speeds up sales of a product. From the factors
that Tigo staff mentioned during the interview with the researcher found out that
each Tigo product has its promotion where by grouping products or by single
product. “Promotion is highly used by Tigo Company compared to other mobile
phone operators not only because Tanzania is a good market to apply this strategy
but it because in general promotions speed up sales of any company”, said Tigo staff
from Marketing department.
Example: Free Facebook was the promotion that conducted by Tigo in mid of 2014
to date that resulted to the increase revenue due to the increase of data /internet users
and smartphone users who contribute much when they purchase data. This also has
been seen during Sabasaba fair, 2015 Tigo Banda was able to sell up to 300pc of
phone per day where 70% of them were smartphones.
This shows how promotion is a successful story to their business in this telecom
industry.
Basing on the factors mentioned by respondents, a researcher draw a relationship
between the factors and the sales performance where all factor mentioned has a
significance relationship with sales performance. These are the things that
respondents mentioned un-promptly by the researcher, this implies that customer has
their attributes to consider in each element of Marketing Mix when they decide to
purchase Tigo Product; moreover one factor within element of market mix can
change their buying behaviour.
In order for the company to increase its sales performance, it should work basing on
the respondents factors mentioned because these factors are what respondents think
they influence sales performance
57
CHAPTER FIVE
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
5.1 Introduction
This chapter presents the summary, conclusions and recommendations on the
findings in chapter four based on research questions, objectives and
recommendations for further studies. The data obtained from the field included the
effect of marketing mix in sales performance in Telecoms market, the purchasing
behaviour of customer if is driven by the Marketing mix.
5.2 Summary
This study was required to investigate the factors influencing sales performance of
Telecommunication Company in Dar es Salaam.
During the study, it was noted that in marketing Mix influence sales performance,
where there is a significant relationship between efficient of marketing mix and sales
performance of a company. The findings show that, each element depends other if
one element doesn’t perform well it’s obvious it affect the other one hence no
performance of sales. And this has easily seen on the products that Tigo has
communicate to its customer those products are well used by customer and also they
are the ones that Tigo staff sell most compared to the ones which are not
communicated (Promoted) like RBT, VAS, Tigo Bima etc. are not highly used by
customers because they are not communicated.
The findings also showed that Tigo is perceived to have good taste of the product and
reasonable price of product, the customers will come back and the customers may
recommend Tigo products to the other people. The company should really notice on
the customers’ needs and wants, then the customers will return and this action is
going to increase the sales volume of the company. Success of the sales volume of
the products in Tigo Company depends in the marketing especially in pricing
strategy.
58
Generally, impact of sales performance has easily seen that is influenced by
marketing mix where if these elements of marketing mix are not implemented all at
once sales will be affected since customers will lack awareness to the product due to
absence of Promotion, lack of product awareness and usage if there will be no place
of distribution, also if price is higher sales will be affected.
5.3 Conclusion
The results indicate that marketing mix has significant relationship with the sales
performance. It means that all our hypotheses are supported and there are
relationship between Product, price, promotion and place as marketing mix with
sales performance as an outcome of marketing strategic. According to these finding
we can say that the marketing mix has been the marketing manager’s toolkit for
success. A firm’s marketing
Marketing plan of a company should go hand in hand with the 4Ps of the marketing
mix toolkit, with practitioners (other key players in the market) and marketer’s tasks
need to put emphasis into product, place, price, and promotion. It also fits with the
firm's sales performance, including changes to the company's performance will
occur, this also need to be evaluated by the responsible person so that to make sure
this elements of marketing mix have positive relationship with the performance of
sales in the company.
According to the research objectives, marketing managers and top managers should
pay sufficient attention to their marketing strategy planning, because all 4Ps have a
relationship with sales performance and all of them can play an important role in the
firm's success. Marketing is often seen as a key driver of business performance and
profitability.
Generally, from the findings presented and analysed in chapter Four, it can be learnt
that Marketing mix (price, product, promotion and placement) depends on each other
to make the sales performance either to be high or low and these are the factors that
influence sales performance in the market. Affordable price, good offers (product),
59
promotions and place of distributions enable customer to purchase more, to have
options while purchasing Tigo Products hence Increase of sales.
5.4 Recommendations
As mobile industry continues to scale rapidly, with a total of 3.6 billion unique
mobile subscribers at the end of 2014. Half of the world’s population now has a
mobile subscription—up from just one in five 10 years ago. An additional one billion
subscribers are predicted by 2020, taking the global penetration rate to approximately
60%. There were 7.1 billion global SIM connections at the end of 2014, and a
further 243 million machine-to-machine (M2M) connections, this opportunity gives
Tigo a bigger room to work on its marketing mix strategies so that to increase its
sales.
As per study findings showed that:
There is a need of reviewing of Product and Promotion from Tigo whereas the
findings show that some of the products are not popular to the customer because they
are not promoted.
Products like VAS, RBT, Tigo Music and Tigo Bima do not used by many
customers compared to the other product, this is likewise to Tigo staff that sale Tigo
product the mentioned products are not moving compared to the other products. So
the recommendation to Tigo Company is to reposition this product and promote
more to the customers and when the reposition and review these product they have to
consider the change of the technology, need of the service in the market, value of the
service to the customer and content of the service because these product are not the
core product to the company.
Also, the study shows that the reasons why customer buy Tigo products is not
because competitors do not offer these product but is because of Price and Good
offers, so I recommend Tigo Company to be innovative and design more new
products that their competitors do not have so that to have many customers and
increase sales.
60
To have loyalty programmes and products that will make the customer to maintain
their Tigo SIM and be their Primary SIM where this will make customer to spend
more money on this SIM hence the increase of sales performance in the company.
These loyalty programs may involve the Brand ambassadors I the collage, among
entrepreneurs, bloggers and employers where they need to give them incentives in
relation to what amount they spend in their Tigo SIM.
As the number of mobile phone users will increase by one billion by 2020 globally,
Tigo Company needs to be innovative in all aspects of Marketing mix so that to
make themselves sustain in Telecom market in Tanzania. It is obvious that things
will be more digitalized due to the advancement of technology so they need have to
position the brand in digital life style. This is supposed to include price where I
recommend service should be in affordable price as communication will be a primary
need and quality of the services /product should be good so that Tigo can be
perceived as a company that has value for money. Also, place and promotion should
be digitalized where the customer buying process should be easy and have rewarded
at the same time to speed up sales.
Finally, for further researches I suggest that investigating other components of
marketing which should able to develop sales performance. In addition, study on way
of pricing is highly recommended and will be useful under critical competitive
situation in Telecom.
.
61
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67
Appendix 1:
Schedule of Activities
The table below shows briefly how different activities will be performed in a given
period of time.
Table 1: Schedule of Activities from November 2014- June 2015
Activities Dec Jan Feb March April May June
Proposal writing
Proposal Submission
Data collection
Data analysis
Dissertation writing
Submission of first
draft
Revision of the draft
report
Dissertation binding
and submission
68
Appendix 2:
Estimated Budget
SN Activities Cost
1 Proposal preparation 4 draft 200,000
2 Transportation and communication 400,000
3 Stationary and photocopy 400,000
4 Meals and Accommodation 300,000
5 Data collection, analysis and entry 500,000
6 Correspondences with supervisor 300,000
7 Defending the dissertation 200,000
8 Miscellaneous 10% 200,000
GRAND TOTAL 2,500,000
69
Appendix 3:
Definition of Indicators
Indicators Definition
Price Price means the monetary value of the product has been fixed
for exchange purpose
Promotion The promotion include all communications a marketers used in
the market for his products of services to create awareness,
persuade the customers to buy and retain in future also.
Product Is a combination of tangibles and intangibles aspects of the
products offered by the manufacturer to the customers.
Place Is the point or location where the product is made available to
purchase.
70
Appendix 4:
Questionnaire for Tigo Staff
Tick the answer
1. Gender
o Male
o Female
2. Age
o 16 – 21 Years
o 22 – 30 Years
o 31 – 35 Years
o 46 and above Years
3. For how long have you working with Tigo?
o 1 – 5 months
o 6 – 12 months
o 1 – 2 years
o More than 2 years
4. Which department do you belong?
……………………………………………………………………………….
5. What Product do you sell?
o Tigo Pesa
o Voice
o Data
o SMS
o VAS
o RBT
o Tigo Music
o Tigo Bima
o Others
71
6. Which ones do you sell most?
7. Which ones are more preffered by customers?
Product Yes No
Tigo Pesa
Voice
Data
SMS
VAS
RBT
Tigo Music
Tigo Bima
Others
Product Yes No
Tigo Pesa
Voice
Data
SMS
VAS
RBT
Tigo Music
Tigo Bima
Others
72
8. Why do you think these customer prefer those product mentioned?
9. How do you think product consideration influence sales performance?
Product Low
Price
High
Price
Affordable
Price
Competitors
don’t offer
that service
High
demand
of the
product
Promotion
on that
product
Good
offer
Tigo
Pesa
Voice
Data
SMS
VAS
RBT
Tigo
Music
Tigo
Bima
Others
Product Very
Important
Somehow
important
Not
Important
Not Important
at all
Tigo Pesa
Voice
Data
SMS
VAS
RBT
Tigo Music
73
10. To what extent you think product consideration influence sales performance?
11. What sales promotion do you offer?
Tigo Bima
Others
Product To Large Extent To Some Extent Not Applicable
Tigo Pesa
Voice
Data
SMS
VAS
RBT
Tigo Music
Tigo Bima
Others
Product Smartp
hone
Acquisitio
n
Corporate
packages
Post-paid
offer
4G Pre-paid
packages
Tigo Pesa
Voice
Data
SMS
VAS
RBT
Tigo Music
Tigo Bima
Others
74
12. Which promotion is most preferred by customers?
13. To what extent price affect customers purchasing behaviour?
14. Does promotion from Tigo makes you buy more of Tigo products?
o Yes
o No
Product Yes No
Smartphone
Acquisition
Corporate packages
Post-paid offer
4G
Pre-paid packages
Product To Large Extent To Some Extent Not Applicable
Tigo Pesa
Voice
Data
SMS
VAS
RBT
Tigo Music
Tigo Bima
Others
75
15. If YES please mention that promotion
…………………………………………………………………………………
……………………………………………………………………………….
16. Where do you sell Tigo products?
17. Does your place of distribution affect your sales performance?
o Yes
o No
o Other (please explain) ……………………………………………….
18. Impact of channel of sales in sales performance
Place Yes No
Tigo Shop
Freelancer
Umbrellas in the street
Wakalas
Online (*148*00#)
Key Account Managers
Direct sales
Indirect sales
Place High Sales Medium Sales Low Sales
Tigo Shop
Freelancer
Umbrellas in the street
Wakalas
Online (*148*00#)
Key Account Managers
Direct sales
Indirect sales
76
Appendix 5:
Questionnaire for Tigo Customers
1. Gender
o Male
o Female
2. Age
o 16 – 21 Years
o 22 – 30 Years
o 31 – 35 Years
o 46 and above Years
3. Do you use Tigo products?
o Yes
o No
4. What Product do you use?
o Tigo Pesa
o Voice
o Data
o SMS
o VAS
o RBT
o Tigo Music
o Tigo Bima
o Others (please mention) …………………………………………..
5. Which ones do you use most?
Product Yes No
Tigo Pesa
Voice
Data
SMS
77
6. What do you consider when you purchase/subscribe Tigo Products?
7. Are you influenced by price when you buy products from Tigo?
o Yes, I care about the price
o No, I don’t care about the price
8. In what extent price affect your purchasing behaviour?
VAS
RBT
Tigo Music
Tigo Bima
Others
Product Price Types of
product
Validity of
the product
Volume
of the
product
Many
people use
the
product
Pre-paid
packages
Tigo Pesa
Voice
Data
SMS
VAS
RBT
Tigo Music
Tigo Bima
Others
Product To Large Extent To Some Extent Not Applicable
Tigo Pesa
Voice
78
9. Do you use any sales promotion offered by Tigo?
o Yes
o No
10. If YES please mention the promotion: ………………………….......................
11. Where do you get information about Tigo products and promotions?
o Online/web
o Facebook
o SMS
o IVR
o TV
o Radio
o Told by friend
o Billboards
o Brochures
o Journals
o Road show
o Others (please mention) …………………………………………
12. Does promotions form Tigo makes you buy more Tigo products?
o Yes
o No
Data
SMS
VAS
RBT
Tigo Music
Tigo Bima
Others
79
13. Where do you buy Tigo products?
Place Yes No
Tigo Shop
Freelancer
Umbrellas in the street
Wakalas
Online (*148*00#)
Key Account Managers
Direct sales
Indirect sales
80
Appendix 6:
Interview questions
1. Product
a. what product do you sell?...............
b. which product do you sell most?..................
c. Do you have any reason in mind on why the mentioned products are
moving so fast?............................
d. Why your customers preferred them more than the others?
....................
e. Are there any factors do you think users preferred more in a certain
product than the other?
f. Can these factors influence your customers on which product to
buy?..........
2. Promotions
a. Are there any promotions do you run in the market?...................
b. To what extent do you think promotion help to booster your
sales?...............
c. Do you have specific promotion for particular products?.............
d. Which criteria do you use in choosing a product to promote?.......
e. How do you measure the impact of your promotions?.......
f. How often do you run promotions?..........................
3. Pricing and Sales
a. To what extent do price affect purchasing behaviour of your
customers?
b. Do the customers increase their purchases of Tigo products?
c. Where do you sale your products?
d. Which sales point do you think sale more?
e. Do you think distribution affect your sales in any way?
f. Does location of a sales point affect your sales? How and Why?
THANK AND CLOSE