`

PUBLIC RELATIONS STRATEGIES

AND MARKETING PERFORMANCE IN
THE GSM INDUSTRY IN NIGERIA
(2001 – 2010)

BY

OLUJIE, CHINANU MABEL

U2007/0630250

DEPARTMENT OF MARKETING,
FACULTY OF MANAGEMENT SCIENCES,
UNIVERSITY OF PORT HARCOURT.

FEBRUARY, 2012.
`

PUBLIC RELATIONS STRATEGIES

AND MARKETING PERFORMANCE IN
THE GSM INDUSTRY IN NIGERIA
(2001 – 2010)

BY

OLUJIE, CHINANU MABEL

U2007/0630250

DEPARTMENT OF MARKETING
FACULTY OF MANAGEMENT SCIENCES
UNIVERSITY OF PORT HARCOURT

BEING A PROJECT SUBMITTED IN PARTIAL

FULFILLMENT OF THE REQUIREMENT FOR THE
AWARD OF BACHELOR OF SCIENCE (B.Sc) DEGREE
IN MARKETING

FEBRUARY, 2012.
 DECLARATION

I hereby declare that this project is my original work and has not been

previously presented wholly or in part for the award of any other degree

nor currently submitted for the award of any other degree.

STUDENT’S NAME: OLUJIE, CHINANU MABEL

SIGNATURE & DATE: ……………………………………………

iii
 CERTIFICATION

UNIVERSITY OF PORT HARCOURT

FACULTY OF MANAGEMENT SCIENCES
DEPARTMENT OF MARKETING

PUBLIC RELATIONS STRATEGIES AND MARKETING

PERFORMANCE IN THE GSM INDUSTRY
IN NIGERIA (2001 – 2010)

BY

OLUJIE, CHINANU MABEL

U2007/0630250

The Board of Examiners declares as follows:

That to the best of our knowledge, this is the original work of the
candidate. That this project is accepted in partial fulfillment of the
requirements for the award of the Bachelor of Science (B.Sc) in
Marketing.

MR. A. I. UDUMA ………………………… ………………………

PROJECT SUPERVISOR SIGNATURE DATE

DR. A. C. EZIRIM ………………………… ………………………

HEAD OF DEPARTMENT SIGNATURE DATE

PROF. S. E. KALU ………………………… ………………………

DEAN OF FACULTY SIGNATURE DATE

CHAIRMAN, BOARD OF ………………………… ………………………

EXTERNAL EXAMINERS SIGNATURE DATE

iv
 DEDICATION

I dedicate this work to the Almighty God, Jehovah for his infinite

mercies and undeserved kindness for making me see the end of this

journey. And to my parents, Mr. and Mrs. E. A. Olujie for their patience

and guidance.

v
 ACKNOWLEDGEMENT

I wish to thank my parents, Mr. & Mrs. E. A. Olujie for their care

and support throughout my years in school.

I am sincerely grateful to my project supervisor, Mr. Uduma A.

Idika for his indispensable supervision in this study even during

inconvenient situations; God bless you sir.

I am also thankful to my lovely sisters, ‘Chinex babe’ and ‘Ud gurl’

for helping me do my chores when I was deeply concentrated with making

research for this work. I love you girls!

I also wish to thank some of my friends, who gave me the needed

strength and encouragement to finish this work. They are; Obinna Chisom

Ijeoma a.k.a. ‘HandsObi, Wondaboi’; awesome Joshua Oki (*bold*), Kelly

Johnson, Stanley Nwakuche, Iyke Njoku, Emmanuel Umoh, Don. Engr.

Wax, Amaka Okandu, Lynn Nkemdirim Njoku and Horsfal Ebenezer

Isoboye. This list is by no way exhaustive. Thank you all.

vi
 TABLE OF CONTENTS

PAGES

TITLE PAGE i

DECLARATION iii

CERTIFICATION iv

DEDICATION v

ACKNOWLEDGEMENT vi

TABLE OF CONTENT vii

LIST OF TABLES x

LIST OF FIGURES xii

ABSTRACT xiv

CHAPTER ONE

1.0 INTRODUCTION 1

1.1 Overview of the Study 1

1.2 Statement of the Problem 4

1.3 Purpose of the Study 5

1.4 Research Questions 6

1.5 Statement of Hypotheses 7

1.6 Significance of Study 7

1.7 Scope and Limitations of Study 8

1.8 Definition of Terms 9

vii
 REFRENCES 19

CHAPTER TWO

2.0 LITERATURE REVIEW 21

2.1 Introduction 21

2.2 Information & Communication Technology (ICT) 23

2.3 History of ICT 26

2.4 ICT in Education and the Society 31

2.5 The Nigerian Banking System 35

2.6 ICT Operations in the Nigerian Banking System 39

2.7 ICT-Based Financial Products and Services 44

2.8 Empirical Test for ICT and Banking Business 49

2.9 Challenges of ICT in the Nigerian Banking System 54

REFERENCES 59

CHAPTER THREE

3.0 RESEARCH METHODOLOGY 62

3.1 Introduction 62

3.2 Research Design 62

3.3 Sampling Procedure 63

3.4 Data Collection Methods 63

3.5 Operational Measures of the Variables 64

viii
 3.6 Model Specification and Data Analysis Techniques 65

REFERENCES 70

CHAPTER FOUR

4.0 PRESENTATION AND ANALYSIS OF DATA 71

4.1 Introduction 71

4.2 Data Presentation 71

4.3 Data Analysis 74

REFERENCES 85

CHAPTER FIVE

5.0 DISCUSSION, CONCLUSSION AND

RECOMMENDATIONS 86

5.1 Introduction 86

5.2 Discussion of Findings 86

5.3 Conclusion 88

5.4 Recommendations 89

BIBLIOGRAPHY 90

APPENDIX A 95

ix
 LIST OF TABLES

Table 4.1: Time Series data showing ICT and GTB Plc’s financial

performance Indicators (2001 – 2010) 72

Table 4.2: Multiple Regression Test results of Earnings after

Tax (EAT) and ICT Indicators (2001 – 2010) 74

Table 4.3: Multiple Regression Test results of Earnings per

Share (EPS) and ICT Indicators (2001 – 2010) 75

Table 4.4: Multiple Regression Test results of Deposit

Mobilization and ICT Indicators (2001 – 2010) 76

Table 4.5: Multiple Regression Test results of Loans and

Advances and ICT Indicators (2001 – 2010) 77

Table 4.6: Simple Linear Regression Test Results of Earnings

after Tax (EAT) and Diffusion Ratio (2001 – 2010) 79

Table 4.7: Simple Linear Regression of Earnings per Share

(EPS) and Diffusion Ratio (2001 – 2010) 79

Table 4.8: Simple Linear Regression Test Results of Deposit

Mobilization and Diffusion Ratio (2001 – 2010) 80

Table 4.9: Simple Linear Regression Test Results of Loans and

Advances and Diffusion Ratio (2001 – 2010) 82

x
 LIST OF FIGURES

Figure 2.1: A Model of ICT Operations in the Nigerian Banking

Industry

Figure A.1: Graph showing the trend of the Number of

Computers and ATM Machines in GTB Plc (2001 –

2010) 98

Figure A.2: Graph showing the trend of the Number of Internet

and Mobile Banking Customers in GTB Plc (2001 –

2010) 99

Figure A.3: Graph showing the trend of the Number of Other

ICT Devices in GTB Plc (2001 – 2010) 100

Figure A.4: Graph showing the trend of the Diffusion of ICT in the

Nigerian banking system (2001 – 2010) 100

Figure A.5: Graph showing the growth of Earnings after Tax

(EAT) and Earnings per Share (EPS) in GTB Plc (2001 –

2010) 101

Figure A.6: Graph showing the growth of Deposit

Mobilization and Loans & Advances in GTB Plc (2001 –

2010) 102

xi
`

ABSTRACT

The study focused on the Diffusion of Information & Communication

Technology (ICT) in the Nigerian banking system.
 CHAPTER ONE

INTRODUCTION

1.1 Introduction

Developing the right promotional strategy is essential to any

organization that wants to achieve its set goals and objectives. For an

organization that recognizes the importance of its publics to its survival,

an important aspect of this is deciding which of these promotional

strategies can be used to enhance a firm’s marketing performance, and

bring it in good terms with its publics (Ndibe, 2009).

Over the years, organizations have been faced with several

challenges on how to enhance their marketing performance, attract and

keep the attention of their customers, gain loyalty, and also build

sustainable competitive advantage against their competitors. This is

sequel to the fact that every organization needs their publics, i.e.

investors, government, suppliers, distributors, employees, host

community, consumers/customers, etc. in order to survive.

Top management however, has various options on how to build a

favorable image through promotion to their publics. They include:

advertising, personnel, sales promotion, publicity and public relations.

1
 Often, it is heard that an organization has a good or bad public

relations. What does this mean? The answer is that public attitude

towards the organization is either favorable or unfavorable. It can be said

that the public has a lot of confidence or that it lacks confidence in the

organization (Ndibe, 2009).

Why, one would ask, should an organization bother about public

opinion? The answer is not farfetched. Over the years, organizations have

been made or marred as a result of the positive or negative opinions their

publics have of them (Ndibe, 2009).

This lends credence to the fact that as social animals, people tend to

be mutually dependent; seeking help from one another, and needing the

approval of one another to receive such help. In other words, it is the

mutual dependence of people and business, government, and social

institutions that has given rise to that function of management known as

public relations. As a growing business, organizations depend more and

more on its publics to achieve set goals and attain a desirable marketing

performance. Organizations have discovered that that their success

depends on the opinion their customers have about them, and the

performance of their employees. Such organizations have also learnt that

their ability to produce good quality products at the required time will

depend on their relationship with their suppliers. In brief, such an

organization would recognize the need for creating a favorable image in

2
the minds of its publics, of establishing policies, actions, or ideas that

would enable it enhance its marketing performance. This has given rise to

public relations.

Organizations may not be able to quantify what they lose if they

don’t use public relations. But companies which use public relations can

see the benefits of increased awareness of themselves and their products;

better staff recruitment and retention, greater market share, customer

loyalty, shareholder satisfaction, and higher productivity by employees.

(Ndibe, 2009).

This research looks into public relations strategies as it affects the

marketing performance of the GSM Industry in Nigeria.

1.2 Statement of the Problem

It has been a norm in the GSM Industry in Nigeria to invest a lot in

advertisement with the aim of persuading potential subscribers to

patronize their networks.

But then, the GSM industry in Nigeria faces a unique set of

challenges. In spite of the huge investment in advertising, they still face

the problem of figuring out how they can attain a reasonable profit,

provide quality service despite the epileptic state of infrastructural

development and power generation in the state; ward off competitors,

3
meet up with overlapping demand and avoid congestion, and pay up

government taxes and levies.

In view of all this, the problem arises with the best way they can

handle all these issues including subscriber complaints of dropped calls,

congestion, high call rates, scrambled network, poor service, etc., and still

be able to maintain a favorable image that will enable them improve their

marketing performance.

However, despite the amount of research that has been carried out

on public relations and marketing performance, not much research has

been carried out on the effect of public relations strategies on the

marketing performance of the GSM industry in Nigeria. It is against this

background that this research is being carried out in this area.

Specifically, as it affects market share, profitability, change in

profitability, and goodwill of the GSM industry in Nigeria.

1.3 Purpose of the Study

The purpose of this study is to examine the relationship between

public relations strategies and marketing performance. Specifically, this

study seeks to achieve the following objectives:

i. To ascertain the relationship between public relations strategies

and organisation's profitability.

4
 ii. To find out the relationship between public relations strategies

and change in organisation's profitability.

iii. To determine the relationship between public relations

strategies and Goodwill.

iv. To ascertain the relationship between public relations and

organisation's market share.

1.4 Research Questions

i. Is there any relationship between public relations strategies and

organization's profitability?

ii. Do public relations strategies have any effect on change in

organization's profitability?

iii. Is there any relationship between public relations strategies and

Goodwill?

iv. Is there any relationship between public relations strategies

and organization's market share?

1.5 Research Hypotheses

The following hypotheses are postulated and are stated in their null

forms:

Ho1: There is no significant relationship between public relations

strategies and organization's profitability.

5
 Ho2: There is no significant relationship between public relations

strategies and change in organization's profitability.

Ho3: There is no significant relationship between public relations

strategies and Goodwill.

Ho4: There is no significant relationship between public relations

strategies and an organization’s market share.

INDEPENDENT VARIABLE DEPENDENT VARIABLE

PUBLIC RELATIONS STRATEGY MARKETING PERFORMANCE MEASURES

ADVERTISING MARKET SHARE

CSR PROFITABILITY

CHANGE IN
PROFITABILITY

GOODWILL

1.6 Significance of the Study

The presence of unfriendly factors surrounding the growth and

financial improvement of the GSM industry has placed a gap between

gaining a good corporate image, and earning the desired profit without

engaging in shady practices.

6
 In view of this, it is hoped that the study will bring definiteness to

the issue of public relations in the GSM industry. The outcome of this

research will be of immense benefits to those in the service providing

industry in Nigeria. It will enable GSM firms to appreciate the benefits,

and significance of applying public relations strategies to their companies

and avail them the opportunity of earning a good corporate image.

This study will give more insight to the cheapest tool in the

promotional mix and whether or not it has a significant effect on the

marketing performance of the firm’s in the G.S.M. industry. It will enable

G.S.M. firms in Nigeria to know how to employ this tool in order to

achieve a considerable or acceptable improvement in their marketing

performance.

1.7 Scope and Limitations of the Study

The study seeks to examine the relationship between public

relations strategies and marketing performance in the G.S.M. industry in

Nigeria. The limitations of this study is was that the public relations

strategies as it affects marketing performance could only be tested using

the GSM industry and not expanded to other companies in other sectors

of the economy.

7
1.8 Definition of Terms

For clarity, and understanding of the object and bearing of the

study, the following marketing terms have been used and are defined here

based on their meaning to this research:

Public relations: The relationship which exists between an organization

and its several publics; efforts to influence this relationship by

obtaining favorable publicity.

Strategy: The development of a reaction capability by an organization to

adapt to environmental changes as well as the potentials for results.

It involves the explicit specification of an organization’s objectives,

goals, and policies necessary for achieving the goals including the

allocation of resources and the organizational structure.

Marketing: The systematic sampling, implementation, and control of a

mix of business activities intended to bring together buyers and

sellers for the mutually advantageous exchange or transfer of

products.

Industry: Any general business activity or commercial enterprise that

can be isolated from others, such as the tourist industry or the

G.S.M. industry.

Corporate Image: The identity or perception of itself that an

organization attempts to convey to it’s publics through corporate

advertising.
8
Organization: A unit made up of a human group designed to pursue a

given goal or objective.

Publics: Any group of people brought together by a common interest in

which a public relations program seeks to influence, for example

stock holders, customers, legislators, media employees, etc.

Rumor: A widely circulated, unverified, and usually inaccurate story

from an unknown source.

Marketing Performance: This is a term that means the results of

marketing actions. It shows the efficiency and effectiveness of

marketing.

Targets: Any primary group/audience to be reached with a message –

like teachers, farmers, scientists, employees, shareholders, etc.

Profit: Often used to describe the surplus result after a defined trading

period but must be regarded as the first essential change upon a

business, being a reward for engaging resources in good conditions

of superlative risk for the satisfaction of consumer demand. It

furnishes resources to invest in future operations and consequently

its absence must result in a decline.

1.9 Organization of the Study

Chapter 1 includes the overview of the study, statement of the

problem, purpose of the study, research question, hypotheses, conceptual

9
framework, significance of the study, scope of the study, limitations of the

study, definition of terms, and organization of the study.

Chapter 2 includes the review of literature in the area of public

relations strategies and marketing performance. Chapter 3 contains the

research methodology that will be used in the course of the study and

shall include the research design, sampling procedures, population of the

study, data collection, and data analysis techniques.

Chapter 4 includes data presentation, analysis, interpretation and

test of hypotheses. Chapter 5 includes discussion, recommendations, and

suggestion for further studies.

Finally, other relevant appendix is included to support the analyses

of the study.

10
 References

Ezirim, A. C. et al (2006), Public Relations in Action; Owerri: Jeso

International

Ndibe, F. I. (2009), Effective Public Relations; Enugu: Fins and

Associates.

11
 CHAPTER TWO

LITERATURE REVIEW

2.1 Introduction

Some years ago, businesses were least concerned about what the

public thought about the way it ran it's operations, profit was it's

exclusive goal and it believed it's management polices and marketing

strategies were enough to enhance it's performance. It conducted its

affairs in the manner it considered most suitable. As the notion and

structure of businesses evolved, the volume of businesses expanded and

the need to pay attention to other matters relating to public interests and

community affairs emerged. And not purely out of altruistic motives, but

because experience proved that company growth is dependent upon

public goodwill generated by organizations. (Ezirim, Okpara, Onyirika, et.

al 2006).

2.2 The Concept of Public Relations

The British Institute of Public relations (BIPR) (2006) defines

public relations as ‘the deliberate planned and sustained effort to

establish and maintain goodwill and mutual understanding between an

12
organization and its publics.” Canfield and Moore(1973),see PR as that

communication function, "which evaluates public attitudes, identifies the

policies and procedures of an individual or organization with the public

interest and executes a progamme of action to earn public understanding

and acceptance" Webstar's Third International Dictionary defines

public relations as:

1. The promotion of rapport and goodwill between a person, firm

or institution and other persons, special public or community at

large through the distribution of interpretive material, the

development of neighborly inter-change and the assessment

of public reactions.

2. The degree of understanding and goodwill achieved between an

individual, organization or institution and the public.

3. The act or science of developing reciprocal understanding and

goodwill-regarded as narrow.

The last three decades have seen the phenomenal growth of public

relations in the country, with the birth of Nigerian Institute of Public

Relations. The term 'Public Relations' is now of common usage and has

become pertinent in the Nigerian business. And yet, for all it's almost

universal acceptance, public relations, is yet to be correctly understood

13
and appreciated by many who profess familiarity with the terms. The

common concept of public relations, unfortunately, does not tally with the

truth. (Ndibe 2009).

2.2.1 The Erroneous Concept

Public relations suffer from numerous misconceptions and

erroneous beliefs. The most common error is to misidentify public

relations with publicity. For many people, public relations is measured in

terms of the number of times an organization, or an individual, is

publicized in the newspapers or over the radio, or on television. Others

think of public relations simply as a device to foist a subject on the public

and to capture the imagination of the people in favour of the entity being

glamorized. There are also those who regard public relations mainly as the

art of cultivating good graces of government offices, notably finance

agencies which have to do with tax collections, tax exemptions, or the

grant of licenses and other necessary permits (Ndibe, 2009).

2.2.2 The Real Concept

Obviously, If all that public relations involved were a charming

smile, a way with the newspapermen and the ability to penetrate into a

government office, there would be no necessity for researches on the

subject matter. While it is true that public relations does involve publicity
14
and certainly makes use of human relations skill in attaining its

objectives. There is more to public relations than just photo or picture in

the newspapers and a cheerful smile. The true concept of public relations

embraces all aspects of the operations of an organization or the actions of

an individual. It has to do with what an entity does and what it says. It is

the totality of the relationships between an organization and the various

publics with which it deals, as well as among the individual units and

or/departments within the organization itself (Ndibe 2009).

Adetunji (2012,) opined that, Every organization must take

cognizance of PR as a management function that aids in achieving

corporate mission through brand building and management. PR is a

sustained effort that ensures mutual and cordial relationship between an

organization and its publics through sensitivity and liaison to ensure

attitudinal or behavioral change of publics towards the realization of

organizational goals. How can PR function in an organization? It can

function in many ways if incorporated into the organization’s activities or

system (in-house or consultancy). PR internal communication system is

mainly to ensure mutual relationship between an organization and its

internal publics i.e. employees, whose sweats oil the wheel of production

of goods/services. It is very crucial to implement internal communication

system to orchestrate free flow of information from management to staff

and vice versa. This will help control any internal crisis that may be
15
brewing within the organization. PR also encourages information flow

from management to staff and vice versa; and departmental or

interdepartmental communication. The PR man knows the aspirations,

expectations and yearnings of staff and champions it to ensure positive

employee relations.

How can PR ensure employee relations? Employee relations

involves every activity, programme and plan designed for employees to

ensure their loyalty and compliance with the corporate mission. This

could be done by encouraging management in providing a good work

environment. Programmes and events such as award nights, end of the

year parties, workers’ forums, conferences, workers’ loan, pension funds,

insurance, allowances, scholarships, health care, job security,

accommodation, official vehicles and other fringe benefits specially

organized for employees can also be used as PR tools. This will not make

employees see the organization as a profiteer and greedy enterprise but

will foster friendly relationships between management and employees. If

all these preventive activities are advocated, the organization will nip in

the bud likely internal crisis.

PR manages external affairs by ensuring communication of

corporate objectives in a friendly manner to the public. It is a means of

reaching publics personally, through events such as facility visits, product

launches, trade fairs, exhibitions, customer forums, sales promotions and

16
others, to enhance two way communication between external publics and

the organization, build trust, encourage customer relations, and elicit

public opinion on corporate products and services that will contribute

positively to company aims and objectives. Brand management function

of PR involves ensuring consistent quality of product packaging, corporate

colour, name, logo, slogan, trade mark, aesthetic identity, media and

unique corporate services. Corporate image branding contributes

immensely to profit maximization and defeat of competitors. It is a

strategic means of improving gross domestic proposition GDP, and

unique selling proposition USP, by ensuring that product and services

offered to customers combine treasure, pleasure and leisure to satisfy

their desire.

The PR man is a sensitive professional that introduces sanity by

rebranding organizational systems, products and services through

creativity and innovation. This will create awareness that will arouse

interest and desire for corporate products/services, generate conviction

and propel customer action towards organizational goals. The branding

process is a team work that involves management and other personnel.

PR organizes elaborate launch for the new brand. PR’s involvement

is not limited to product launch alone, it may also involve rebranding of

corporate buildings, structures, infrastructures, facilities and the like.

Consultation is made by the PR man with professionals and experts

17
involved to enhance credibility of the pre branding, branding and post

branding process. Marketing function of PR is a sustained effort to assist

in achieving corporate mission, ensure customer relations and contribute

to product or service sales. Marketing strategy of PR involves trade fair,

exhibition, sponsorship, advertising, third party endorsement,

publications, pitch letter, sales promotion and integrated marketing

communication. PR also embarks on corporate social responsibility

campaign to eradicate misconception about the organization by the

publics by ensuring environmental preservation campaigns, discouraging

toxic waste inimical to human health, ensuring community security and

provision of infrastructural facilities, etc. The PR man holds regular

meetings with community leaders, opinion leaders, decision makers and

youths that could perceive the organization as being greedy. This will

avoid bastardisation of the organization’s image through rancour,

hostility, grievances, ignorance, apathy, and prejudice by the community,

which may result to crisis.

2.2.3 Advertising

Advertising is a very important tool of public relations. Advertising

is a paid, non-personal form of communication with an identified

sponsor. Its objective is to inform or to persuade. There are two major

categories of advertising. There is the product advertising which is used to

18
promote the sale of a product or a brand of a product.There is then the

institutional or corporate advertising whose objective is primarily to

project the organization as a public service institution in order to create a

favorable public image. It is this latter type that is referred to as public

relations advertising. Public relations or institutional or corporate or

central promotions advertising devoted primarily to selling the corporate

personality which it’s first objective going beyond the direct sale of a

single product or service. To belong to this type of advertising, authorities

in marketing, Canfield and Moore(1977)in Udeagha(1995) gave the

following conditions:

1. It must educate, inform or impress the public regarding the

company's policies, functions

2. facilities, objectives, ideas and standards.

3. It must aim at building favorable opinion about the company

by stressing the competence of the company's management, its

accumulated scientific knowledge, its manufacturing skill,

technological progress and product improvement, advantages

as well as contributions of the organization to social and public

welfare.

4. It must endeavor to off-set unfavorable publicity and negative

attitudes.

19
 5. It must build up the investment qualities of its securities or

improve the financial structure of the company.

6. It must portray the company as a good place to work in.

2.2.4Objectives Of PR Advertising

According to Ndibe 2009, the principal objectives of public relations

advertising include the following:

1. The creation of a favorable image of an organization: PR advert

is used to promote the image of an organization and indirectly

to promote the sale of the company’s products or services. It

can also help in attracting good employees to the organization

and in winning the goodwill of government officials or the

various financial markets etc.

2. The Correction of Misconception: The image of an organization

or individual could be damaged not because the policies and/or

actions of the organization or individuals are bad but as a result

of wrong perceptions or misunderstanding on the part of the

public. This can have unfavorable effect on sales and profit (low

sales and low profit).It can also lead to lack of support on the

part of financiers for the organization. To correct these, many

companies used to inform the public’s about the progress of the

organization, their own contribution to the well-being of the

20
 society, all these directed towards developing a more

sympathetic conception of the organization.

3. Securing and maintaining good Suppliers: By inviting them to

open houses, advertising in trade papers and business

magazines.

4. Arousing the interest of stockholders and the financial

community: Corporations advertise in the financial sections of

newspapers and in financial magazines to inform shareholders

and the financial community about their financial conditions.

5. Winning the goodwill of the community: Via PR advertising in

city, community newspapers, informing the neighborhood

about the operations of the company as well as about its

contributions towards the welfare of the community.

6. Informing government officials: Adverts are used to discuss

issues relating to pending legislations and to seek the support of

national, state and local government officials.

7. Winning the goodwill of the employees: Companies adverts in

employees magazines, plant or community newspapers in order

to inform workers about policies affecting them, about

company’s plans and progress, to dispel rumors and create a

better understanding between the company and the employees.

21
 8. Informing and serving consumers via consumers magazines,

radio and televisions.

9. Improving labor relations and Rendering Public Services:

E.g. promoting highway safety, national health and contributing

to charitable work.

2.2.5 Corporate Social Responsibility

The concept of Corporate Social Responsibility was initiated by

Oliver Sheldon in 1924. One of the most frequently asked questions for all

those individuals and organizations’ dealing with CSR issues is the

obvious - just what does 'Corporate Social Responsibility' mean anyway?

Is it a stalking horse for an anti-corporate agenda? Something which, like

original sin, you can never escape? Or what? (Mallen Baker, 2004).

Some Definitions: A key indicator to determine the true worth and

value of modern organizations is their ability to give back to the

society part of their income through some mutually beneficial

initiatives (Nkanbra and Okorite, 2007); these initiatives are

encapsulated in the concept of CSR;

i. Wikipedia defined corporate social responsibility (CSR) as “a

concept whereby organizations consider the interests of society

by taking responsibility for the impact of their activities on

22
 customers, employees, shareholders, communities, and the

environment in all aspects of their operations. This obligation is

seen to extend beyond the statutory obligation to comply with

legislation and sees organizations voluntarily taking further

steps to improve the quality of life of employees and their

families as well as of the local community and society at large.”

ii. Actions that appear to further some social good, beyond the

interest of the firm and that which is required by law.

(McWilliams and Siegel, 2001);

iii. CSR is what an organization does to contribute to the social,

economic, political or educational development of the

community where it is located, but which it is not compelled to

do by any law (Ademosu, 2008).

iv. The social responsibility of business encompasses the

economic, legal, ethical, and discretionary expectations that

society has of organizations at a given point in time (Archie,

1979).

Almost all the people interviewed described CSR along the lines of

philanthropy and altruism. Some of these descriptions include:

i. When interviewed on 28th June, 2011, Dr West explained that,

“CSR is the corporate act of giving back to the

23
 immediate and wider community in which organizations

carry out their business in a manner that is meaningful

and valuable and relevant to that community” .

ii. When interviewed on 23rd July 2011, Mr. Itonyo explained

that, “CSR is a way for the companies to reach out to their

host communities by positively impacting on their

environment”.

iii. When interviewed on 23rd July 2011, Mr. Jamabo explained

that, “CSR is a way of saying ‘thank you’ to the

environment in which the operate and a way of also

showing a sense of belonging to the society at large”.

Conceptual Framework Of CSR: Carroll (1991) argues that there are

four categories of corporate social responsibilities which can be depicted

as a pyramid, in which economic responsibilities is the foundation upon

which all other responsibilities are predicated and without which they

cannot be achieved, and discretionary responsibilities are the apex (Figure

1). Notwithstanding, companies are expected to fulfill these four social

responsibilities simultaneously. An important consideration regarding

this perspective is that, contrary to the common belief that economic

responsibility is related to what the companies do for themselves, and the

24
other responsibilities are related to what they do for others, “economic

viability is something business does for society as well” (Carroll, 1991).

The centrality of the ethical and philanthropically areas of

responsibility is underlined in the study of CSR because of the

differentiation they allow to establish between voluntary corporate

behavior and mere compliance. The CSR debate has focused on the moral

and philanthropic responsibilities, giving little attention to economic and

legal responsibilities. In this research, the term CSR will also be used to

refer to ethical and philanthropically responsibilities of business. An

important and recent addition to the discussion of Carroll’s model was

offered by Carroll himself in Schwartz and Carroll (2003). These authors

develop a three-domain approach, in which they propose the

subsumption of the philanthropic or discretionary component under the

ethical and/or economic components. The reasons for such proposal are

related, on the one hand, to the difficulty in distinguishing between

“philanthropic” and “ethical” activities on both the theoretical and prac-

tical levels, and, on the other hand, to the observation that philanthropic

activities are often explained by underlying economic interests.

Carroll (1991) explained that the conceptual framework of CSR is in

a pyramid:

25
 Source: Adapted from Carol (1991, p.42)

Fig. 2.1: Caroll’s Pyramid of CSR

Economic Responsibility: According to Adeoti (2006), economic

responsibility is the bed rock of all responsibilities and the

foundation of all CSR, which if not achieved other responsibility will

not be attained. This responsibility emphasizes the reason for

business establishment. According to Carroll (1991), a business first

responsibility is to an economic institution, that is, it should be an

institution whose orientation is to identify customers’ needs and

provide these needs with a view of making profit.

Legal Responsibility: Adeoti (2006) says that the company is to

comply with established laws by government. The law reflects a view

of codified ethics that embody basics notion of fairness established

26
 by the government. Such laws include payment of taxes,

environmental protection and other.

Ndibe(2009) posits that corporate social responsibility is an

indicator of sound community relations and has a way for sales since the

business of a company depends upon the community and its residents.

Community relations does not end when the company succeeds in

fulfilling its obligations. It starts when the organization becomes aware of

its role in contributing to community welfare. While the objectives of

community relations varies and are numerous, the most important claims

are:

1. To assist and participate in the civic programs of the

community.

2. To contribute to local institutions and civic organizations.

3. To support informal health programs such as the World Health

Organization, Federal, State, and Local Government health

programs, Petroleum trust fund health programs etc.

4. To assist in the fight against crime and juvenile delinquency,

and drug abuse.

5. To contribute to the up-liftment of the community by helping to

provide facilities and equipment.

27
 6. To participate in and sponsor seminars, workshops, and

discussions that may benefit the members of the community.

7. By co-operating with the government in implementing

programs that have to do with community development.

From the above mentioned objectives, one can see that, corporate

social responsibility comes up as a result of a sound relationship between

a company and its existing community public.

2.3 The Concept of Marketing Performance

Contextually, marketing performance could be understood to be the

effectiveness and efficiency of marketing activities. They are the results of

advertising, promotion and selling activities or investments in an

organization over a given period of time. There are various measures used

to evaluate the overall performance of a company, due to marketing

activities. Coffey(2010), looks at a key performance indicator that

companies should use:

2.3.1 Return on Marketing Investment

One popular performance indicator is return on investment (ROI).

Since we’re focusing on the effectiveness of marketing specifically, we’ll

focus on a derivative of ROI—return on marketing investment (ROMI).

28
The ROMI formula can be used to assess how much your investment in

your overall marketing activities is paying off. However, since our goal is

to specifically determine which marketing activities are positively

contributing to your bottom line, you should use the following ROMI

calculation to assess your marketing activities individually. Here’s a

simple formula for calculating ROMI:

ROMI = Revenue generated from X marketing activity

/ by the marketing budget for X activity

Using the information generated by the activity-specific ROMI, you

can determine not simply whether the marketing activity is meeting your

marketing objectives but whether it is a cost-efficient means for doing so

based on how you’re currently implementing it; that, in turn can help you

to make a plethora of decisions. For instance, you’ll be able to decide

whether you need to revise your implementation strategy to allow for

increased revenue, whether it’s most feasible to budget the marketing

activity on a limited basis rather than an ongoing basis and how profitable

that marketing activity is compared to your other marketing activities.

As a company’s marketing plan becomes more complex and their

business expands, they will want to add additional performance indicator

assessments. This study will go further to examine these additional

29
measures, which include; market share, profitability, change in

profitability and goodwill.

2.3.2 Market Share

One key indicator of a company’s marketing performance is its market

share. Investopedia (2012), defines market share as ,” The percentage of

an industry or market's total sales that is earned by a particular company

over a specified time period. Market share is calculated by taking the

company's sales over the period and dividing it by the total sales of the

industry over the same period. This metric is used to give a general idea of

the size of a company to its market and its competitors.”

"Market share is the percentage of a market (defined in terms of

either units or revenue) accounted for by a specific entity." In a survey of

nearly 200 senior marketing managers, 67 percent responded that they

found the "dollar market share" metric very useful, while 61% found "unit

market share" very useful.

"Marketers need to be able to translate sales targets into market

share because this will demonstrate whether forecasts are to be attained

by growing with the market or by capturing share from competitors. The

latter will almost always be more difficult to achieve. Market share is

closely monitored for signs of change in the competitive landscape, and it

frequently drives strategic or tactical action."

30
Increasing market share is one of the most important objectives of

business. The main advantage of using market share as a measure of

business performance is that it is less dependent upon macro

environmental variables such as the state of the economy or changes in

tax policy.

2.3.3 Purpose of Market Share

Market share is a key indicator of market competitiveness—that is,

how well a firm is doing against its competitors. "This metric,

supplemented by changes in sales revenue, helps managers evaluate both

primary and selective demand in their market. That is, it enables them to

judge not only total market growth or decline but also trends in

customers’ selections among competitors. Generally, sales growth

resulting from primary demand (total market growth) is less costly and

more profitable than that achieved by capturing share from competitors.

Conversely, losses in market share can signal serious long-term problems

that require strategic adjustments. Firms with market shares below a

certain level may not be viable. Similarly, within a firm’s product line,

market share trends for individual products are considered early

indicators of future opportunities or problems."

Research has also shown that market share is a desired asset among

competing firms. Experts, however, discourage making market share an

31
objective and criterion upon which to base economic policies. The

aforementioned usage of market share as a basis for gauging the

performance of competing firms has fostered a system in which firms

make decisions with regard to their operation with careful consideration

of the impact of each decision on the market share of their competitors. It

is generally necessary to commission market research (generally

desk/secondary research) to determine. Sometimes, though, one can use

primary research to estimate the total market size and a company's

market share.

2.3.4 Construction

"Market share: The percentage of a market accounted for by a

specific entity. "Unit market share: The units sold by a particular company

as a percentage of total market sales, measured in the same units." Unit

market share (%) = 100 * Unit sales (#) / Total Market Unit Sales (#)

"This formula, of course, can be rearranged to derive either unit sales or

total market unit sales from the other two variables, as illustrated in the

following: "Unit sales (#) = Unit market share (%) * Total Market Unit

Sales (#) / 100 Total Market Unit Sales (#) = 100 * Unit sales (#) / Unit

market share (%) "Revenue market share: Revenue market share differs

from unit market share in that it reflects the prices at which goods are

32
sold. In fact, a relatively simple way to calculate relative price is to divide

revenue market share by unit market share."

Revenue market share (%) = 100 * Sales Revenue ($) /

Total Market Sales Revenue($)

"As with the unit market share, this equation for revenue market share

can be rearranged to calculate either sales revenue or total market sales

revenue from the other two variables."

Methodologies:"Although market share is likely the single most

important marketing metric, there is no generally acknowledged best

method for calculating it. This is unfortunate, as different methods may

yield not only different computations of market share at a given moment,

but also widely divergent trends over time. The reasons for these

disparities include variations in the lenses through which share is viewed

(units versus dollars), where in the channel the measurements are taken

(shipments from manufacturers versus consumer purchases), market

definition (scope of the competitive universe), and measurement error."

(Wikipedia,2011).

33
2.3.5 Profitability

Profitability is measured with income Business dictionary

(2012),defines profitability as, ‘The state or condition of yielding a

financial profit or gain. It is often measured by price to earnings ratio.

Hofstrand (2009) explains that, ‘Profitability is the primary goal of all

business ventures. Without profitability the business will not survive in

the long run. So measuring current and past profitability and projecting

future profitability and expenses. is very important.

Income is money generated from the activities of the business. For

example, if crops and livestock are produced and sold, income is

generated. However, money coming into the business from activities like

borrowing money do not create income. This is simply a cash transaction

a between the business and the lender to generate cash for operating the

business or buying assets.

Expenses are the cost of resources used up or consumed by the

activities of the business. For example, seed corn is an expense of a farm

business because it is used up in the production process. Resources such

as machine whose useful life is more than one year is used up over a

period of years. Repayment of a loan is not an expense, it is merely a cash

transfer between the business and the lender.

Profitability is measured with an “income statement”. This is

essentially a listing of income and expenses during a period of time

34
(usually a year) for the entire business. Decision Tool Income Statement -

Short Form, is used to do a simple income statement analysis. An Income

Statement is traditionally used to measure profitability of the business for

the past accounting period. However, a “pro forma income statement”

measures projected profitability of the business for the upcoming

accounting period. A budget may be used when you want to project

profitability for a particular project or a portion of a business

2.3.6 Reasons for Computing Profitability

Whether you are recording profitability for the past period or

projecting profitability for the coming period, measuring profitability is

the most important measure of the success of the business. A business

that is not profitable cannot survive. Conversely, a business that is highly

profitable has the ability to reward its owners with a large return on their

investment.

Increasing profitability is one of the most important tasks of the

business managers. Managers constantly look for ways to change the

business to improve profitability. These potential changes can be analyzed

with a pro forma income statement or a Partial Budget. Partial budgeting

allows you to assess the impact on profitability of a small or incremental

change in the business before it is implemented.

35
A variety of Profitability Ratios (Decision Tool) can be used to assess the

financial health of a business. These ratios, created from the income

statement, can be compared with industry benchmarks. Also, Income

Statement Trends (Decision Tool) can be tracked over a period of years to

identify emerging problems.

2.3.7 Change In Profitability

Coffey (2010) says that the easiest way to gain initial insight as to

whether a marketing tactic is effective is to look at the money it’s gaining .

So, take a moment to review your bank statements. Compare your profit

prior to launching your marketing campaign and your profit as of today.

Here are two formulas that will be helpful:

$ VALUE CHANGE IN PROFITABILITY = (Profit B – Profit A)

Where,

Profit A is the profit at time “t” (an initial point) and

Profit B is the revenue at point after time “t”

% CHANGE IN PROFITABILITY = [(Profit B – Profit

A) / Profit A]x 100

36
 Looking at your calculations, is there a positive change, negative

change or no change at all? What is the percentage of change in

profitability? The benefit of using the naira value and percent change in

profitability as a collective marketing performance assessment tool is that

it’s an easy short-term financial indicator of successful (or unsuccessful)

marketing activities. Simply put: If the marketing activity is helping you to

generate income that you did not previously have, it is working. The

question is: How well is it really working. That’s where using additional

performance indicators can be useful.

2.3.8 Goodwill

Abraham (2004), defined goodwill as, ‘An intangible asset of an

enterprise or organization including its repute, the value of its brands and

place in the market place.’ The Merriam -Webster Dictionary (2012)sees

goodwill as, ‘The favor or advantage that a business has acquired

especially through its brands and its good reputation -The value of

projected earnings increases of a business especially as part of its

purchase price -The excess of the purchase price of a company over its

book value which represents the value of goodwill as an intangible asset

for accounting purposes’

Marketing activities, such as customer/after sales service, advertising, and

public relations are carried out by marketers in order to promote the

37
goodwill of their organizations. Here, as with those missionaries that

promote faith, the marketer builds goodwill with customers with the

longer-term aim of generating orders and competitive advantage.

Goodwill is a significant indicator of whether the marketing objective of

satisfying consumers and having a cordial relationship with a company’s

various publics, has actually been achieved. All efforts by companies

towards developing and maintaining a high value and good brand

reputation are measured by the level of goodwill they enjoy.

Goodwill can be valued quantitatively, in a company’s financial

statement. Wikipedia(2011) says,” Goodwill in financial statements arises

when a company is purchased for more than the fair value of the

identifiable net assets of the company. The difference between the

purchase price and the sum of the fair value of the net assets is by

definition the value of the "goodwill" of the purchased company. The

acquiring company must recognize goodwill as an asset in its financial

statements and present it as a separate line item on the balance sheet,

according to the current purchase accounting method. In this sense,

goodwill serves as the balancing sum that allows one firm to provide

accounting information regarding its purchase of another firm for a price

substantially different from its book value. Goodwill can be negative,

arising where the net assets at the date of acquisition, fairly valued, exceed

the cost of acquisition.[1] Negative goodwill is recognized as a gain to the

38
extent that it exceeds allocations to certain assets. Under current

accounting standards, it is no longer recognized as an extraordinary item.

For example, a software company may have net assets (consisting

primarily of miscellaneous equipment, and assuming no debt) valued at

$1 million, but the company's overall value (including brand, customers,

intellectual capital) is valued at $10 million. Anybody buying that

company would book $10 million in total assets acquired, comprising $1

million physical assets, and $9 million in goodwill. In a private company,

goodwill has no predetermined value prior to the acquisition; its

magnitude depends on the two other variables by definition. A publicly

traded company, by contrast, is subject to a constant process of market

valuation, so goodwill will always be apparent. There is a distinction

between two types of goodwill depending upon the type of business

enterprise: institutional goodwill and professional practice goodwill.

Furthermore, goodwill in a professional practice entity may be attributed

to the practice itself and to the professional practitioner.

2.4 Public Relations and Marketing Performance

Compared with the studies on the effect of advertising on sales,

literature about the effects of public relations on market performance is

not well established. As the interest in public relations and public

39
relations budgets has increased, accountability for public relations has

become a more important issue in business organizations.

The public relations literature sees the impact of public relations

both in financial terms and in terms of long-term credible relationships

with key publics. The economic performance typically refers to dollars and

the monetary return on investments given back to a firm (Grunig, Grunig,

and Dozier, 2002). There is some incongruence in trying to measure the

effect of public relations on the organization in terms of economic

performance.

Some public relations scholars and professionals do not believe that

money invested in public relations can be linked to a consistent, yearly

monetary return on investment. Many CEOs agree that public relations is

a contributing factor, rather than the determinant of organizational

effectiveness (Campbell 1993). Furthermore, there is little empirical

research that has directly related the public relations budgets or

expenditures to a company’s economic performance. The basic

perspective of these studies implies that a goal of public relations is not a

direct increase of the bottom line, but that public relations can contribute

to a firm’s market performance by achieving its goals of good reputation

or good relationships with stakeholders. That is, the effects of public

relations on market performance have been inferred by examining the

40
relationship between outcome measures (e.g., goodwill, social

responsibility) of public relations and market performance.

For example, Preston (1981) suggested that public relations may

make an indirect contribution to organizational effectiveness and

emphasized that social responsibility is an indirect contribution of public

relations. He reviewed the relationship between socially relevant

behaviors of companies and their economic performances and found that

responsible behavior indirectly affects a firm’s performance. Similarly,

Tuleja (1985) stated that ethical behavior formed through public relations

helps companies enhance their economic performance indirectly by

developing more productive employees and avoiding excessive

governmental and nongovernmental regulations. Hon (1997) suggested

that attributes of public relations effectives were defined as managing

risks, building relationships, fostering media relations, earning respect,

increasing understanding, achieving goals, affecting registration, and

disseminating appropriate messages. This research established building

relationships and earning respect as two major dependent variables for

public relations effectiveness. Vercic (2000) posited that trust as an

attitudinal measure of public relations explains the financial performance

of a corporation. He found that trust has no direct relationship to

organizational performance, but it determines the organization’s

performance in certain contexts. Kim (2001) established a two-stage

41
model to measure the economic value of public relations by testing two

relationships: (1) the impact of public relations expenditure on reputation

as a public relations goal and (2) the economic impact of reputation on

companies’ bottom lines. His study found that public relations

expenditure affects the company’s reputation positively, and the

company’s reputation affects the company’s revenue positively. He

concluded that public relations expenditures indirectly affect a firm’s

revenues.

The studies mentioned above assume that the public relations goal

is not to increase a firm’s economic performance directly but to contribute

to its performance by achieving public relations goals. However, the direct

relationship between public relations and market performance has still

been of key interest among marketing scholars and practitioners.

Moreover, as integrated marketing communication has received a great

deal of interest from academic researchers and practitioners, performance

measures based on the effects of integrated marketing communication

have been the hot issue. With respect to integrated marketing

communication and performance issues, some researchers have insisted

that integration in marketing communication should lead to some level of

superior business performance (McArthur and Griffin, 1997; McGoon

1998; Pickton and Hartley, 1998; Kitchen and Schultz, 1999; Eagle and

Kitchen, 2000; Low, 2000). In other words, through integrated marketing

42
communication, a firm can attain synergy from all of its marketing

communication activities, and in turn, this synergy leads to performance

benefits. However, despite the increasing interest in the link between

integrated marketing communication and economic performance at

brand-levels or firm-levels, there has been little empirical evidence to

support this integrated marketing communication-performance

relationship. Thus, this study attempts to examine the direct effect of

public relations on market performance.

2.4.1 Advertising and Market Share

The subject of advertising having a relationship with market share

has not been adequately explored by scholars. One would think that the

publicity and awareness gained by advertising one’s brand would have an

automatic effect on the market share of that company. Although some

literature.

On public relations are of the idea that advertising has some effect

on market share, further study on resultant factors affecting market share

do not list advertising as being a reason for either increase or decline in

market share, strangely enough. Therefore, this research will attempt to

find out for a fact, just how much influence public relations advertising

has on a company’s market share.

43
2.4.2 Advertising and Profitability

Kundu, Kukarni, Murthy, (2012) wrote;” There is increasing

awareness over the need to measure the impact of marketing activities on

firm performance. Practitioners are increasingly under pressure to report

their contribution to the overall firm performance. The inherent

complexity in quantifying the marketing activities has often become a

barrier in developing metrics for marketing measurement. O’Sullivan and

Abela (2007) report that the ability to measure the internal marketing

performance causes a significant impact on firm performance,

profitability; stock return and marketing’s stature within the firm.

In recent years a number of studies suggest that a firm’s advertising

(Frieder and Subrahmanyam 2005; Grullon, Kanatas, and Weston 2004;

Joshi and Hanssens 2007,) directly affects profitability. This is in addition

to the indirect effect of advertising through increase in sales revenues and

profits. Srinivasan and Hansens (2007) carry out an extensive literature

survey on the impact of advertisement on market and firm value.

The effect of the advertising on consumers rests on the theory of

message repetition. It can be classified into three main effects: a current

effect on behavior, a carryover effect on behavior and a non behavioral

effect on attitude and memory (Pechmann and Stewart 1988; Sawyer

1981; Sawyer and Ward 1976).

44
Researchers have tried to estimate the effects of advertising on brand

sales using field data (Leone and Schultz 1980; Vakratsas and Ambler

1996). Most of these studies focus on many technical issues involved in

efficiently capturing the unbiased effects of advertising, given the

imitations of field data (Hanssens, Parsons, and Schultz 1990).

Deeper analysis of these studies finds that the effects of advertising

are significantly greater than zero but do vary by market and product

characteristics (Assmus, Farley, and Lehmann 1984; Sethuraman and

Tellis 1991). Few studies have addressed the effect of advertising effects

on profitability. Little has been researched on capturing the impact of how

the effects vary by creative medium or vehicle, and time of day for

broadcast advertising (e.g., Bhattacharya and Lodish 1994).

In particular, no study has researched the effects of advertising by

these three factors simultaneously. While marketers know that that

consumer behavior is influenced by multiple factors, yet little research has

been done on understanding the impact using the integrated marketing

mix model ( Sethi 1977, Feichtinger, Hartl and Sethi, 1994). This is

attributed to the fragility of advertising’s effects and the complexities

involved in getting bias-free estimates.

Naik and Raman (2003) present an insight as to how a marketer or

a shareholder is keen on measuring the impact of marketing (advertising )

on market performance.(profitability) To assess these effects marketers

45
often use regression analysis. Arguing that OLS models introduce biasing

effects, they put forward the Weiner Kalman Filter(WKF) that provides

estimates that are closer to the true parameters. Advertising's ffectiveness

lies in its capability to help stimulate or maintain sales and induce

rofits.(Eachambadi 1994; Mantrala, Sinha, and Zoltners 1992; Naik,

Mantrala, and Sawyer Sethi 1998; Vidale and Wolfe 1957). Thus,

advertising is frequently used as an independent variable in explaining

changes in sales (Lilien 1994). Abraham and Lodish (1990) believe that

advertising effectiveness has to be captured by the additional sales of a

product over and above those that would have happened in absence of any

advertising or promotion. Although advertising managers have long

believed that advertising's impact on sales can persist longer than the

current period (Clarke 1976), the tendency to assume that advertising's

effect on sales is short-term is yet prevalent. They further argue that the

longer uses of advertising are better than less and shorter uses of it

irrespective of the nature of contribution of advertisement to sales (Jones

1992, 1995).

The inability of measures to differentiate the impact of

advertisement between its short term and long term effects have resulted

in wastage of advertising expenditure (Abraham and Lodish, 1990; Bass

1969).

46
2.4.3 Advertising and Change in Profitability

To also be tested is the effect of advertising on change in

profitability. It seeks to find out whether advertising costs , have a

negative ,positive, or zero effect on a company’s profitability during one

time frame and another.

2.4.4 Advertising and Goodwill

According to encyclopedia for business (2012), “Although

advertising is a function of public relations—as it is concerned with

promoting and gaining public acceptance for the company's products—

the goal of advertising is generating sales, while the goal of public

relations is generating good will . The effect of good public relations is to

lessen the gap between how an organization sees itself and how others

outside the organization perceive it”. This goes to suggest that advertising,

as a variable, is not directly responsible the goodwill generated by a

company, but is indirectly related to goodwill, under the umbrella of

public relations.

However, Winters (1986) in Kyung-ran (2007) reported that brand

advertising is effective for enhancing the marketing image for a company,

while corporate advertising is effective for improving the social conduct

image of the company.

47
 Since reputation has been regarded as having the same component

as brand equity (Jeffries-Fox Associates, 2000), marketing

communication, especially advertising, also has great value to a

corporation. There have been many reputation studies. For example,

marketing and management researchers have investigated how people

form perceptions of a company’s reputation and how that reputation

affects consumers’ perceptions of price unfairness and influences

managers’ decision-making (Campbell, 1999). However, relatively little

attention has been given to the relationship between advertising and

corporate reputation. Little empirical research has examined how

marketing communication, especially advertising, affects corporate

reputation from firms’ point of view. The public constructs reputations

from available information about a firm’s activities originating from the

firm itself, from the media, or from other sources. Since different sectors

of the public attend to different features of firms’ performance,

reputations reflect firms’ relative success in fulfilling the expectations of

multiple stakeholders (Freeman, 1984). A study by Fibrin and Stanley

(1990) investigating the factors that influence corporate reputation found

that publics construct reputation on the basis of corporate strategy

signals. Differentiation through advertising has been considered the most

representative signal of corporate strategy.

48
 Both brand and corporate advertising help firms develop strategic

positions that are differentiated from their competitors’ and that provide

them with a measure of goodwill from consumers and other stakeholders

(Rumelt, 1987). Also, advertising helps induce a protected strategic

position that stabilizes sales. Advertising not only signals product and

firm characteristics in ways that can reduce stakeholders’ search cost for

information but also presents firms in a favorable light. Advertising is

viewed as a source of product and imaging cues designed to influence the

perceptions of external publics. Advertising can further reinforce the

information that customers have already acquired with respect to brands

or companies. Often, advertising is used as a tool to inform about product

quality. A sufficient level of advertising implies a significant investment

on the part of the firm.

While managing a corporate reputation involves many factors,

research has suggested that advertising has been successful in promoting

corporate reputation to various audiences. Many academic researchers

have supported the idea that companies rely on advertising to develop

their reputations. Podolny (1993) suggested that the positive interactions

between reputation and salient firm features such as advertising provide a

firm with greater incentive to engage in actions that further enhance its

reputation.” (Kyung-ran, 2007).

49
2.4.5 CSR and Market Share

Kotler, Lee (2005) posits that corporate social responsibility has a

direct relationship with market share. In their text, they cited a result

from a benchmark survey of consumers carried out by Cone/Roper in

2004.They provided strong evidence that companies can benefit

significantly from connecting themselves to a cause.

Though little direct correlation has been made between corporate

social responsibility (CSR) and market share gains, experts usually agree

that adhering to CSR guidelines does produce long-term business

benefits. CSR is an expansion of business ethics that requires companies

to consider social responsibilities beyond optimizing shareholder value.

(Kokemuller 2011).

2.4.6 CSR and Profitability

There have been arguments on the topic of corporate social

responsibility having a direct relationship with a company’s profitability.

Various scholarly articles have been written on the subject matter but no

consensus has been reached. Hennigfeld, Pohl, and Tolhurst

(2006),opined that ,”It is not so much a matter of whether profit

subsequently arises from social actions, but whether profit or altruism is

the main reason for the action in the first place. However, corporate

motives are difficult, sometimes impossible to determine. Moreover,

50
despite numerous academic studies, a direct relationship between social

responsibility and profitability have been almost impossible to

ambiguously ‘prove’.(Griffin and Mahon,1997; Waddock and

Graves,1997). Even though the overall weight of evidence seems to

suggest some kind of positive relationship, there is still the issue of

causality. When successful companies are seen to be operating CSR

programmes, it is just as reasonable to suggest that CSR does not

contribute to success, but rather that financial success frees the company

to indulge in the luxury of CSR.”

2.4.7 CSR and Change in Profitability

Extensive studies have not been undergone on the subject of CSR

and change in profitability. Similarly, it has also been difficult to establish

a direct relationship between corporate social responsibility and change in

a company’s profitability. Since no sure inference has been drawn

concerning this, then it is not established that CSR has any impact or

effect on a company’s change in profitability.

2.4.8 CSR and Goodwill

Many factors impact a consumer’s decisions about which company’s

product they will purchase or use. To many individuals, social

responsibility can play a major factor in deciding what companies will

51
receive their money. CSR can help build goodwill in a brand by showing

potential customers that the company cares about more than the bottom

line. Socially responsible programs can be featured in advertising

campaigns targeting the types of individuals who would most likely be

passionate about the issues that a particular CSR policy is taking up.

2.5 The GSM Industry in Nigeria

The first mobile services in Nigeria were introduced in 2001, but

growth in the mobile communications sector has been so fast that mobile

penetration surpassed fixed-line penetration very quickly, with wireline

penetration struggling at barely 1 percent. In Nigeria's wireline market the

government operator, NITEL, dominates the 24 other private operators

providing fixed-line services, and the whole wireline sector has been faced

with serious issues such as liquidity problems and capital adequacy.

However, the liberalization of the telecom sector and subsequent increase

in competition have been the key drivers of growth in this sector and has

also brought benefits to the customers in terms of lower prices and

enhanced services and choice.

Total telecom investment in Nigeria by end-2004 reached USD 10

billion. able 2 provides an overview of the country's telecom sector in

terms of subscriber numbers and penetration rates.

52
Table 2.1: Nigeria - Telecom Industry Snapshot

Source: Portio Research Ltd.

Mobile Market

The Nigerian mobile market is a comparatively young market by

African standards, with the first mobile services only launched in 2001.

However, the Nigerian mobile market has emerged as the fastest growing

mobile market in Africa, registering triple-digit growth rates in subscriber

numbers.

The rapid growth in the mobile market has been primarily due to

the government's liberalization policy and the subsequent increase in

competition in the market. The presence of competition in the market has

resulted in a rapid growth in the countries subscriber base, reduced

tariffs, wide network coverage and high quality of service, along with the

creation of employment opportunities. The operators are witnessing lower

ARPU and a slowing rise in profits, primarily driven by lower mobile

tariffs and the growth of low-income and low-usage subscribers.

53
 The current role calls of GSM operators consists of MTN,

Glomobile, Airtel (the erstwhile Zain), Etisalat - and still notionally

providing a service, NITEL's M-Tel. All operators provide services based

on 2G (GSM) and 2.5G (GPRS) networks. Although 3G services are not

yet available in the country, MTN is expected to launch these services

based on UMTS technology. CDMA has had a more checkered history,

with its lack of national coverage and comprehensive geographical

coverage weighing against it. Current operators are Visafone, Multilinks,

Starcomms and ZoomMobile. Multilinks was acquired by South Africa's

Telkom, and is now up for sale.

The Nigerian mobile market also has a large number of VAS

companies, such as MTech, TaviaTxt, SaveMyContacts, Textnigeria,

Entegration Solutions, Cellulant, 3G Reality Centre and A3&O, which

generate mobile content to deliver value-added services via the GSM

network operators. The mobile operators share the revenues equally with

these private VAS companies, barring M-Tel, which is yet to develop a

relationship with a VAS company.

Market Size: The total number of mobile subscribers in Nigeria as on 31

December 2010 was 87.3 million, with a penetration rate of

approximately 55 percent. The subscriber base more than tripled in one

54
year, increasing from 3.15 million at the end of 2003 to 9.58 million at the

end of 2004.

The number of mobile subscribers in Nigeria is expected to increase

at a CAGR of approximately 30.2 percent from 18.56 million at end-2005

to 90.47 million at end-2011. The corresponding penetration rate is

expected to increase from 14.4 percent to 60.9 percent. Moreover, 3G

services, expected to be launched in 2006 are likely to account for

approximately 13.4 percent of the total subscribers in 2011.

Table 3 shows the forecasts for mobile subscribers in Nigeria for the

10-year period from 2002 to 2011.

Table 2.2: Nigeria - Mobile Subscribers (2002-2011, In Million)

Source: Portio Research Ltd.

Table 2.1 illustrates the trends and forecasts for mobile subscribers

and penetration rate in Nigeria for the 10-year period from 2002 to 2011.

Figure 1: Nigeria - Mobile Subscribers and Penetration (2002-2011)

55
Source: Portio Research Ltd.

Mobile Network Operators: Nigeria's mobile market is competitive in

nature with four operators providing mobile services. However, the three

leading operators together accounted for more than 90 percent of the

country's total subscribers at the end-November 2005, and the fourth

operator is a much smaller player in the market.

Figure 2 provides the market share of the various operators in

Nigeria's mobile market in terms of subscriber base at the end-November

2005.

56
Fig. 2.1: Nigeria - Market Share of Mobile Network Operators

Source: Company Reports

The four operators currently providing mobile services in Nigeria

are discussed below:

MTN Nigeria: MTN Nigeria is the subsidiary of MTN International and

launched its GSM services in the country in 2001. The operator also

provides 2.5G (GPRS) services. At present, it is the largest operator in

terms of subscribers. Its network covered more than 58 percent of the

total population of Nigeria at end-March 2005.

The company has significantly increased its pace of network

expansion in the country in order to cope with the increasing subscriber

base and solve network congestion problems. MTN had invested more

57
than USD 1.8 billion on its network infrastructure in Nigeria by end-

March 2005.

Figure 3 shows the ownership structure of the company as on November

2005.

Fig. 3: MTN Nigeria - Ownership Structure (November 2005)

Source: Company Reports

Table 4 provides an overview of the operator's key performance

indicators.

58
Table 4: MTN Nigeria - Key Performance Indicators

Source: Company Reports

AIRTEL

Econet Wireless Nigeria (EWN) launched its mobile services in

Nigeria in 2001 under the brand Vmobile. EWN became Vee Networks

Limited, and had 25 percent of the total subscriber base at year-end 2004.

Vmobile's shareholding structure was divided between private

nvestors/institutions and state at 60 and 40 percent, respectively. Despite

Econet's best efforts.control was first taken by Zain, and then sold at the

beginning of 2010 to Bharti Airtel. At the time of acquisition, Zain Group

had to provide an indemnity to Airtel to cover possible litigation.

M-Tel (Mobile Telecommunications Limited)

M-Tel, which is held by the government-owned Nigerian

Telecommunications Limited (NITEL), launched its GSM services in the

country in 2001, along with two other operators, viz., MTN Nigeria and

Vmobile (now Airtel). Due to financial difficulties, it could not expand its

59
network nationally and, according to recent reports, is maintaining a

minimalist network with less than 1 percent of the total subscriber base. It

provides 2.5G (GPRS) services as well.

Glo Mobile (Globacom)

Glo Mobile (Globacom) is the latest operator to enter Nigeria's

mobile market. It launched its services in 2003 and has since acquired a

substantial subscriber base in the country, accounting for approximately

25 percent of the total subscriber base at year-end 2004. Glo Mobile

provides a fairly standard array of value added services on its 2G (GSM)

and 2.5G (GPRS) networks, such as SMS, per second billing, mobile

banking, MMS, ringtone and logo downloads, Internet access, etc.

Globacom is owned by the Nigerian petrochemical company

Conpetro.

Recent Developments: Some of the recent developments in Nigeria's

mobile market are as follows:

Mergers and Acquisitions

The government announced plans to privatise NITEL (and its

mobile-arm, M-Tel) since 1999. After a few unsuccessful attempts to

partially privatize NITEL, the government resolved to complete NITEL's

privatization before the end of 2005. In July 2005, six prospective

60
investors were short-listed for a 51 percent stake, which include MTN

Group, a consortium of Telkom and Vodacom, Orascom Telecom, another

consortium of Huawei Technologies and Jacu, Celtel International and

Newtel. However, in December 2005, it was reported that only two of the

six short-listed players, namely Orascom and Newtel, would take part in

the bidding. A possible reason for the disinterest shown in the bidding is

speculated to be the doubt on whether SAT-3, an underwater cable owned

by NITEL, would be included in the bidding. Despite a sale being

completed, this was short-lived, and the operator an its licences were put

for sale again in 2010, with a completion anticipated at the end of the

year. This too failed when the consortium involved was unable to make

the initial down-payment, leaving the operator in limbo at the start of

2011. The status of SAT-3's inclusion in the bidding has not been clarified

by the Ministry.

The Virgin Group and Vodafone confirmed in June 2005 their

intention to form a consortium to jointly bid for a stake in Vmobile.

Technology Innovations and New Services Vmobile Nigeria signed a

contract with Harris Corporation, a supplier of wireless equipment and

services in May 2005 to supply TRuepoint microwave digital radios. The

agreement would provide for the expansion of the operators' network in

new territories to support up to 500,000 new subscribers.

61
Price competition between operators will help in increasing the subscriber

base as well as drive the growth of value-added services in the market.

Top of page

Future Outlook: The growth in Nigeria's mobile market has been

spurred by the government's liberalization policy and hence the

introduction of competition in the market. With the increase in

competition in the market and the continuing growth in the size of the

subscriber base, the market is expected to keep growing fast but suffering

from price competition and subscriber churn rates. The main inhibitors to

the growth presently are the low income levels in the country and the high

prices of handsets. Hence, the subsidization of mobile handsets as well as

targeting the low-income group through tariff reduction and well

structured prepaid offerings should continue to stimulate high growth in

the Nigerian mobile market over the next few years.

As well as driving overall growth, solid price competition between

the operators should, in turn, help drive the growth of value-added

services in the market. As the market matures, it is expected that

operators will focus on churn reduction and improving quality of service.

Specifically, some of the factors that should continue to drive high growth

in mobile services in Nigeria are as follows:

62
 # Large population and low levels of penetration

# Increased competition in the market

The number of mobile subscribers in Nigeria is expected to grow to

approximately 90.47 million by end-2011, with a corresponding

penetration rate of 60.9 percent.

2.6 Summary

Various literature reviewed in this study have revealed some level of

interest on the subject of public relations strategies as it affects a firm’s

marketing performance. These studies have provided a basis for

researches on the subject matter. In the Nigerian GSM industry, it is

imperative to discover the various public relations strategies the

companies engage in, and furthermore, if they have any effect on selected

indicators of their marketing performance.

Interestingly enough, there have been controversies on the subject

matter of whether public relations strategies actually enhance marketing

performance. Different studies have opined and posited opposite views

regarding the existence of direct relationships between the independent

and dependent variables used in this study.

Going forward, data used to represent both public relations

strategies and marketing performance indicators will be subject to test

whereby inference will be drawn.

63
 References

Adetunji, A.O. (2012), Concept of Public Relations;

http://www.m2weekly.com

Africa and Middle East Telecom (2011), Nigeria: Major African Mobile

Markets: Future Growth Prospects. Africa and Middle East Telecom

week Inc.

Coffey, T. (2010), 3 Key Marketing Performance Indicators;

http://www.moguldonmedia group.com

Encyclopedia of Business (2012): Public Relations

Ezirim, A. C. et al (2006), Public Relations in Action; Owerri: Jeso

International

Hirschey, M. (1982), Advertising and the Profitability of leading and

following firms. Journal of Managerial and Decision Economics.

Hofstrand, D. (2009), Understanding Profitability. Iowa State University

Investopedia (2012), Market Share Definition. Investopedia

Incorporated.

Ismael, S. T., Basem A.Y. (2010), “Relationship Marketing and

Organizational Performance Indicators.” European Journal Of

Social Sciences.

64
Kokemuller N. (2011), Corporate Social Responsibility Impact on Market

Share. Demand Media Incorporated.

Kundu. A., et al (2010), Advertising and firm value: Mapping the

relationship between Advertising, Profitability and Business

Strategy in India. Indian Business Academy Bangalore.

Kyung-ran K.(2007), The Effects of Advertising and Publicity on

Corporate Reputation and Sales Revenue:1985-2005; The

University of Texas at Austin.

Mac Dougall C. D. (2009), A Working Concept of Public Relations

http://www.moguldonmedia group.com

National Open University of Nigeria (2006), Principles and Practice of

Public Relations. http://www.nou.edu.ng

Ndibe, F. I. (2009), Effective Public Relations; Enugu: Fins and

Associates.

Smith, A. K. (2011), The Value Of Corporate Social Responsibility;

Helium Inc.

Sticky Marketing Magazine (2004), Goodwill Defined.

http://www.stickymarketing.net.

65
 CHAPTER THREE

RESEARCH METHODOLOGY

3.1 Introduction

This section of the study focuses on the method in which the

research work would be carried out. The period of the study is from 2001

to 2010 which is ten years. Key sub-headings in this section includes the

research design, sampling procedure, data collection methods, types of

data used in the study, operational measures of variables and the data

analysis technique. The population of the study is the four mobile

telecommunications companies in the GSM industry in Nigeria; namely,

MTN, GLOBACOM, Bharti AIRTEL and ETISALAT.

3.2 Research Design

This is seen as a framework or plan that is used as a guide in

collecting and analyzing data for a study. It refers to a plan of action that

guides a researcher to determine relations among variables in order to

make inferences. The research design therefore describes the major

procedure to be followed in carrying out a research. (Ogolo, 1996). In

order to thoroughly understand the impact public relations strategies

81
have on the marketing performance in the GSM industry, and to realize

the stated objectives of this study, the quasi-experimental research survey

is employed. According to Baridam (2001), “quasi – experimental

research designs are largely descriptive studies where the aim is to

generate new fact.’’

3.3 Sampling Procedure

This has to do with selecting samples that will be used for this study.

The sampling methods that will be used are the non-probability method

and the technique used is convenience sampling. The non-probability

method of sampling is used because the selection of items in the sample is

based on the researcher’s judgment and the convenience sample is chosen

purely on the basis of convenience as the name implies, because the

variables are accessible. (Ogolo, 2007).

The study focuses on the four mobile telecommunications

companies in Nigeria as a case study. The sample therefore is MTN,

GLOBACOM, Bharti AIRTEL and ETISALAT; their internal processes like

the operations of serving customers debiting and crediting the airtime

accounts of customers and the sponsorships of special events which may

include special donations and some corporate social responsibility (CSR)

activities.

82
3.4 Data Collection Methods

According to Janet (1984), data are raw or unprocessed facts which

do not make any meaning on its own until they are processed to become

information when subjected under certain conditions. There are basically

two (2) types of data in research, primary and secondary data. Baridam

(2001) opines that primary data are raw facts and figures collected from

its original sense for use for a specific purpose. Secondary data on the

hand are obtained from pre-existing documents. In this study, only

secondary data was used to represent MTN, GLOBACOM, Bharti AIRTEL

and ETISALAT. Indicators used for the dependent variable, the marketing

performance of the GSM companies include, market share, profit after tax

(PAT), change in PAT and return of marketing investment of financial

performance indicators. On the other hand, indicators used to represent

the independent variable, the public relations strategies include;

advertising & marketing costs, goodwill and corporate social

responsibility (CSR).

Data collected were obtained from the Annual reports and accounts

of MTN, GLOBACOM, Bharti AIRTEL and ETISALAT for 2001 – 2010,

2003 – 2010, 2001 – 2010 and 2005 – 2010 respectively; and other

articles and reviews of various issues by journalists and analysts of the

Nigerian telecommunications industry.

83
3.5 Operational Measures Of Variables

Exploratory research was applied in this study. Baridam (2001)

discussed exploratory research as that which is usually concerned with

testing a hypothesis about a relationship between an independent and a

dependent variable. In exploratory research, the dependent variable is the

object which is under investigation. Abdellah and Levine (1979) also

stated that the dependent and independent variables in exploratory

research also includes variables that are not of specific interest to the

researcher but are present in the research situation and can influence the

findings of the explanatory or independent variables if uncontrolled.

In Baridam (2001), a variable is described as a property that takes

on different values or that varies. It is a symbol to which numerals or

values are assigned. The independent variables which are also referred to

as the predictor or explanatory variables are those that are naturally in the

environment or are manipulated by the researcher. The dependent

variable depends on the independent variable. It is of the assumption that

the marketing performance of the four GSM companies is brought about

by the adoption of various public relations strategies and so, MTN,

GLOBACOM, Bharti AIRTEL and ETISALAT’s marketing performance

indicators serve as the dependent variables, while that of public relations

strategies are the independent, predictor or explanatory variables. Four

(4) hypotheses were therefore tested in their null form.

84
3.5.1 The Dependent Variables

It is of the assumption that public relations strategies lead to a

positive increase in the marketing performance variables; therefore the

indicators used to represent marketing performance of the GSM industry

in Nigeria are the dependent variables. These indicators are time series

data gathered between the years of 2001 to 2010.

Market Share: This is the percentage of the total sales of services

divided by the total number of people who can utilize such services

of each of the four GSM companies in Nigeria. A high market share

percentage suggests that a company’s services are consumed by a

high population of persons and vice versa. MKTS_M, MKTS_G,

MKTS_A and MKTS_E are variables used to represent market

share of MTN, GLOBACOM, Bharti AIRTEL and ETISALAT

respectively.

Profit after Tax (PAT): This is perhaps the best measure of

profitability. This is the total revenue in naira value of each of the

GSM companies less cost of sales, cost of operations, taxes and

minority interests etc. PAT_M, PAT_G, PAT_A and PAT_E are

variables used to represent PAT of MTN, GLOBACOM, Bharti

AIRTEL and ETISALAT respectively.

85
Change in PAT: This is the percentage change in PAT above calculated

by dividing the difference between the current and previous year’s

PAT with the previous year’s PAT. Based on this computation, the

first year’s change in PAT in the series will be zero. A high

percentage change in PAT suggests that the company’s operations

which may include various public relations strategies was more

efficient thereby leading to an increase in revenue. A fall in this

percentage therefore suggests the opposite. CPAT_M, CPAT_G,

CPAT_A and CPAT_E are variables used to represent change in

Profit after Tax of MTN, GLOBACOM, Bharti AIRTEL and

ETISALAT respectively.

Goodwill: This is the favor or competitive advantage a business acquires

especially through its brands, its good reputation and its employee’s

morale. Goodwill is an intangible asset that is usually measured in

naira value in the balance sheet of companies. Goodwill is provided

or acquired from the various publics of a company. So therefore it is

gotten from the various relationship types created and established

by a company with these publics. GDWL_M, GDWL_G, GDWL_A

and GDWL_E are variables used to represent goodwill values of

MTN, GLOBACOM, Bharti AIRTEL and ETISALAT respectively.

3.5.2 The Independent Variables

86
 Based on the same assumption that the GSM industry marketing

performance is due to various public relations strategies undergone by the

companies, it therefore means that public relations strategies is able to

predict or explain the marketing performance of the four GSM operators

in Nigeria; hence it is the independent variable. Below are the indicators

used to represent public relations strategies. These variables are

secondary data gathered between the years of 2001 to 2010. It is adapted

from related studies like that of Canfield and Moore (1977); Ndibe (2009)

and Mortensen (2007).

Advertising & Marketing Costs: This is the total of all the various

methods and channels of selling, distribution and marketing of all

products and services by companies in the mobile

telecommunication industry. This is extracted from their income

statements for various years. This is measured in naira value.

ADMC_M, ADMC_G, ADMC_A and ADMC_E are variables used to

represent advertising and marketing costs of MTN, GLOBACOM,

Bharti AIRTEL and ETISALAT respectively.

Corporate Social Responsibility (CSR): Every company fulfils a

corporate citizenship responsibility to protect their image and create

a reputation for themselves which in turn increases their goodwill.

Here, the CSR is the total of all donations, sponsorships and cost of

‘special events’ each of these GSM companies have undergone. This

87
 is recorded in naira value in their annual reports and accounts.

CSR_M, CSR_G, CSR_A and CSR_E are variables used to represent

corporate social responsibility of MTN, GLOBACOM, Bharti

AIRTEL and ETISALAT respectively.

3.6 Model Specification And Data Analysis Technique

Data are collected to enable a researcher predict or make inferences

about some pre-conceived notion or relationship between variables. The

nature of the data under analysis determines the nature of the statistical

tool that will be used which in turn is based on the hypotheses to be tested

in the study. All hypotheses are tests for cause and effect relationship and

therefore the regression analysis technique will be used. This statistical

tool will test public relations strategies indicator against marketing

performance indicators of MTN, GLOBACOM, Bharti AIRTEL and

ETISALAT to check if the adoption of different public relations strategies

has had any significant impact over the years on their marketing

performance.

3.6.1 Regression Analysis

The regression equation can be expressed in a simple linear form

were it involves a single dependent variable and a single independent

variable or in its multiple form whereby several independent variables are

tested on a single dependent variable.

88
Simple Linear Model:

=  +  + µ … … … … … … … … … … … … … … … … … … … … … … (1)

Multiple Regression Model:

=  +  +  +  + ⋯ +  + µ … … … . . … … … … … … (2)

Where;

Y = the dependent variable

x1, x2, x3, xn, = independent variable(s)

a = the intercept

b = the slope of the regression line

µt = stochastic or error term

The functional form of this equation for all hypotheses for each of

the GSM companies as used in this study is hereby presented below.

H01 Model:

_ =  +  _ +  _ + 0.05 … … … … … … (3)

_ =  +  _ +  _ + 0.05 … … … … … … . (4)

_ =  +  _ +  _ + 0.05 … … … … … … (5)

_" =  +  _" +  _" + 0.05 … … … … … … (6)

H02 Model:

$_ =  +  _ +  _ + 0.05 … … … … … … (7)

89
 $_ =  +  _ +  _ + 0.05 … … … … … … … (8)

$_ =  +  _ +  _ + 0.05 … … … … … … … (9)

$_" =  +  _" +  _" + 0.05 … … … … … … … (10)

H03 Model:

$_ =  +  _ +  _ + 0.05 … … … … … … (11)

$_ =  +  _ +  _ + 0.05 … … … … … … (12)

$_ =  +  _ +  _ + 0.05 … … … … … … (13)

$_" =  +  _" +  _" + 0.05 … … … … … … (14)

H04 Model:

()_ =  +  _ +  _ + 0.05 … … … … … (15)

()_ =  +  _ +  _ + 0.05 … … … … … (16)

()_ =  +  _ +  _ + 0.05 … … … … … (17)

()_" =  +  _" +  _" + 0.05 … … … … … (18)

Where;

MKTS = Market Share

PAT = Profit after Tax

CPAT = Change in Profit after Tax

GDWL = Goodwill

ADMC = Advertising and Marketing Cost

CSR = Corporate Social Responsibility

90
 The Microsoft Office Excel 2007 and Econometric Views (E-Views)

version 3.1 statistical application packages will be used for the estimation

of all equations.

91
 References

Abdellah, F. G. and Levine, E. (1979), Better Patience Care through

Research; New York: Macmillian Publishing Company.

Baridam, D. M. (1995), Research Methods in Administrative Science; 2nd

Edition; Port Harcourt: An Emperial of Jeson Services.

Baridam, D. M. (2001), Research Methods in Administrative Sciences,

3rd Edition; Port Harcourt: Sherbrook Associates.

Koutsoyiannis A. (1977), Theory of Econometrics, 2nd Edition. London:

The Macmillan Press Ltd.

Ogolo M. B. (1996, 2007), Students’ Guide to Writing Research and

Project Proposals; Port Harcourt. City-Creeks Publishers.

Okereke E. J. and Samuel S. O. (2011), Financial Information System;

Nigeria, PortHarcourt: DavidStones Publishers Ltd.

Spiegel M. R. (1961), Theory and Problems of Statistics, Schaum’s Outline

Series. New York:: McGraw Hill Book Company.

 CHAPTER FOUR

PRESENTATION AND ANALYSIS OF DATA

4.1 Introduction

Data analysis is described as the orderly breakdown of data in

constituent parts in order to answer research questions. (Ogolo, 2007).

This section of the research is the presentation and evaluation of data for

analysis. Below is the data presentation of variables representing both

public relations strategies and the Nigerian GSM industry. Just after that

is the data analysis. The decision to use a particular statistical tool was

based on the data collected and the variables involved in the analysis. The

findings therefore provided the basis for the conclusion on the hypotheses

postulated in chapter one.

4.2 Data Presentation

In this section, variables representing public relations strategies

indicators and the GSM industry are presented.

95
TABLE 4.1: Time Series data showing MTN’s public relations

strategy and marketing performance indicators (2001 – 2010)

INDEPENDENT
DEPENDENT VARIABLES
VARIABLES (N’m)
YEARS

MKTS_M PAT_M CPAT_M GDWL_M

ADMC_M CSR_M
(%) (N’m) (%) (N’m)

2001 0.00 147814.37 0.00 393.62 20694.01 1478.14

2002 0.00 50424.69 -65.89 393.62 7059.46 554.67

2003 0.00 90553.13 79.58 683.65 12677.44 1086.64

2004 0.00 131696.70 45.44 683.65 18437.54 1712.06

2005 47.00 121524.75 -7.72 54899.52 17013.46 1701.35

2006 46.00 220178.15 81.18 559705.79 30824.94 3302.67

2007 43.00 225523.08 2.43 533333.3 31573.23 3608.37

2008 44.00 323244.23 43.33 661155.96 45254.19 5495.15

2009 50.00 308038.10 -4.70 512865.1 43125.33 5544.69

2010 52.00 290263.08 -5.77 430847.29 40636.83 5515.00

Source[s]: Annual Reports and Accounts; MTN Nig. Ltd., various

issues.

96
TABLE 4.2: Time Series data of GLOBACOM’s public relations

strategy and marketing performance indicators (2003 – 2010)

INDEPENDENT
DEPENDENT VARIABLES
VARIABLES (N’m)
YEARS

MKTS_G PAT_G CPAT_G GDWL_G

ADMC_G CSR_G
(%) (N’m) (%) (N’m)

2003 0.00 0.00 0.00 0.00 1550.00 60.50

2004 3.70 60580.48 20.90 314.48 8481.27 605.80

2005 21.62 55901.38 -3.55 25253.78 7826.19 559.01

2006 21.16 101281.95 37.34 257464.66 14179.47 1012.82

2007 19.78 103740.62 1.12 245333.32 14523.69 1037.41

2008 20.24 148692.35 19.93 304131.74 20816.93 1486.92

2009 23.00 141697.53 -2.16 235917.95 19837.65 1416.98

2010 23.92 133521.02 -2.65 198189.75 18692.94 1335.21

Source[s]: Annual Reports and Accounts; GLOBACOM Nig. Ltd.,

various issues.

97
TABLE 4.3: Time Series data showing AIRTEL’s public relations

strategy and marketing performance indicators (2001 – 2010)

INDEPENDENT
DEPENDENT VARIABLES
VARIABLES (N’m)
YEARS

MKTS_A PAT_A CPAT_A GDWL_A

ADMC_A CSR_A
(%) (N’m) (%) (N’m)

2001 0.00 53213.17 0.00 141.70 7449.84 532.13

2002 0.00 18152.89 -23.72 141.70 2541.40 181.53

2003 0.00 32599.13 28.65 246.12 4563.88 325.99

2004 0.00 47410.81 16.36 246.12 6637.51 474.11

2005 16.92 43748.91 -2.78 19763.83 6124.85 437.49

2006 16.56 79264.13 29.22 201494.08 11096.98 792.64

2007 15.48 81188.31 0.87 191999.99 11366.36 811.88

2008 15.84 116367.92 15.60 238016.14 16291.51 1163.68

2009 18.00 110893.72 -1.69 184631.44 15525.12 1108.94

2010 18.72 104494.71 -2.08 155105.02 14629.26 1044.95

Source[s]: Annual Reports and Accounts; ECONET, VODACOM/VeeNetworks.,

CELTEL, ZAIN and Bharti AIRTEL Ltd., various issues; Communiques

and Press Releases.

98
TABLE 4.4: Time Series data of ETISALAT’s public relations

strategy and marketing performance indicators (2005 – 2010)

INDEPENDENT
DEPENDENT VARIABLES
VARIABLES (N’m)
YEARS

MKTS_E PAT_E CPAT_E GDWL_E

ADMC_E CSR_E
(%) (N’m) (%) (N’m)

2005 0.00 0.00 0.00 9091.36 0.00 0.00

2006 3.68 17614.25 6.49 44776.46 2466.00 176.14

2007 3.44 18041.85 0.19 42666.66 2525.86 180.42

2008 3.52 25859.54 3.47 52892.48 3620.34 258.60

2009 4.00 24643.05 -0.38 41029.21 3450.03 246.43

2010 4.16 23221.05 -0.46 34467.78 3250.95 232.21

Source[s]: Annual Reports and Accounts; ETISALAT Nig. Ltd., various issues.

99
4.3 Data Analysis

In this section, results from the test of hypotheses are presented.

Data for this research was analyzed using the Ms Office Excel 2007 and

Econometric Views (E-Views) version 3.1 statistical application packages.

4.3.1 Test Of Hypothesis 1

Null Hypothesis 1 (H01): There is no significant relationship between

public relations strategies and organization’s market share.

Alternate Hypothesis 1 (HA1): There is a significant relationship

between public relations strategies and organization’s market share.

100
TABLE 4.5: Multiple Regression Test results of Public Relations

Strategies and Market Share of MTN (2001 – 2010)

Dependent Variable: MKTS_M

Method: Least Squares
Sample: 2001 2010
Included observations: 10

Variable Coefficient Std. Error t-Statistic Prob.

C 3.832555 18.19727 0.210612 0.8392

ADMC_M -0.000853 0.002360 -0.361294 0.7285
CSR_M 0.015719 0.016149 0.973362 0.3628

R-squared 0.651580 Mean dependent var 28.20000

Adjusted R-squared 0.552031 S.D. dependent var 24.40765
S.E. of regression 16.33615 Akaike info criterion 8.667963
Sum squared resid 1868.089 Schwarz criterion 8.758739
Log likelihood -40.33982 F-statistic 6.545344
Durbin-Watson stat 1.454067 Prob(F-statistic) 0.024967

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

101
TABLE 4.6: Multiple Regression Test results of Public Relations

Strategies and Market Share of GLOBACOM (2003 – 2010)

Dependent Variable: MKTS_G

Method: Least Squares
Sample: 2003 2010
Included observations: 8

Variable Coefficient Std. Error t-Statistic Prob.

C 7.942902 7.624357 1.041780 0.3452

ADMC_G -0.012198 0.013606 -0.896519 0.4111
CSR_G 0.181216 0.185683 0.975939 0.3739

R-squared 0.676854 Mean dependent var 16.67750

Adjusted R-squared 0.547596 S.D. dependent var 9.302998
S.E. of regression 6.257291 Akaike info criterion 6.785368
Sum squared resid 195.7684 Schwarz criterion 6.815159
Log likelihood -24.14147 F-statistic 5.236441
Durbin-Watson stat 2.622822 Prob(F-statistic) 0.059360

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

102
TABLE 4.7: Multiple Regression Test results of Public Relations

Strategies and Market Share of AIRTEL (2001 – 2010)

Dependent Variable: MKTS_A

Method: Least Squares
Sample: 2001 2010
Included observations: 10

Variable Coefficient Std. Error t-Statistic Prob.

C -3.486078 4.632025 -0.752603 0.4762

ADMC_A 8.685373 75.51626 0.115013 0.9117
CSR_A -121.5753 1057.226 -0.114995 0.9117

R-squared 0.605168 Mean dependent var 10.15200

Adjusted R-squared 0.492359 S.D. dependent var 8.786754
S.E. of regression 6.260467 Akaike info criterion 6.749712
Sum squared resid 274.3541 Schwarz criterion 6.840487
Log likelihood -30.74856 F-statistic 5.364536
Durbin-Watson stat 1.794823 Prob(F-statistic) 0.038676

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

103
TABLE 4.8: Multiple Regression Test results of Public Relations

Strategies and Market Share of ETISALAT (2005 – 2010)

Dependent Variable: MKTS_E

Method: Least Squares
Sample: 2005 2010
Included observations: 6

Variable Coefficient Std. Error t-Statistic Prob.

C 0.187417 0.388320 0.482635 0.6624

ADMC_E 12.42203 5.496890 2.259829 0.1089
CSR_E -173.8921 76.95602 -2.259629 0.1090

R-squared 0.959447 Mean dependent var 3.133333

Adjusted R-squared 0.932412 S.D. dependent var 1.559829
S.E. of regression 0.405520 Akaike info criterion 1.339558
Sum squared resid 0.493339 Schwarz criterion 1.235438
Log likelihood -1.018675 F-statistic 35.48879
Durbin-Watson stat 1.954049 Prob(F-statistic) 0.008166

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

4.3.2 Hypothesis 1 Test Results Interpretation

In Table 4.5 above, MTN’s advertising and marketing cost is

negative and insignificant with her market share. This is shown by the co-

efficient, t-statistic and probability values of -0.00853, -0.361294 and

0.7285 respectively. On the other hand, corporate social responsibility

(CSR) is positive and insignificantly related to market share as shown by

the coefficient, t-statistic and probability values of 0.015719 0.973362 and

0.3628 respectively. These simply mean that a 1% increase in these

variables would cause a subsequent percentage increase as denoted by

their coefficient values. Public relations strategy therefore does not

104
appear to have a significant relationship with market share or in other

words, the engagement of public relations activities and strategies is not

sufficient to explain the annual rise or fall in market share of MTN Nig.

Ltd. The F-statistics which measures the overall goodness of fit of the

model is positive and significant with a value of 35.49. This simply means

that the model was fit for the type of test carried out. The R2 which is

called the coefficient of determination of the model shows the degree to

which the independent variable explains variations in the dependent

variable. Since the test involves more than one independent variable, the

adjusted R2 is used which gives a value of 0.932412; which is positive and

significant implying that the independent variables jointly explain up to

93.24% of the total variations in market share between the years of 2001

– 2010.

In Table 4.6, GLOBACOM’s advertising and marketing cost is

negative and insignificant with her market share. This is shown by the co-

efficient, t-statistic and probability values of -0.012198, -0.896519 and

0.4111 respectively. On the other hand, corporate social responsibility

(CSR) is positive and insignificantly related to market share as shown by

the coefficient, t-statistic and probability values of 0.181216, 0.975939

and 0.3739 respectively. Public relations strategy therefore does not

appear to have a significant relationship with market share or in other

words, the engagement of public relations activities and strategies is not

105
sufficient to explain the annual rise or fall in market share of GLOBACOM

Nig. Ltd. The F-statistics which measures the overall goodness of fit of the

model is positive and significant with a value of 5.236441. This simply

means that the model was fit for the type of test carried out. The R2 which

is called the coefficient of determination of the model shows the degree to

which the independent variable explains variations in the dependent

variable. Since the test involves more than one independent variable, the

adjusted R2 is used which gives a value of 0.547596; which is positive and

significant implying that the independent variables jointly explain up to

54.76% of the total variations in market share between the years of 2003

– 2010.

In Table 4.7, AIRTEL’s advertising and marketing cost is positive

and insignificant with her market share. This is shown by the co-efficient,

t-statistic and probability values of 8.685373, 0.115013 and 0.9117

respectively. On the other hand, corporate social responsibility (CSR) is

negative and insignificantly related to market share as shown by the

coefficient, t-statistic and probability values of -121.5753, -0.114995 and

0.9117 respectively. Public relations strategy therefore does not appear to

have a significant relationship with market share or in other words, the

engagement of public relations activities and strategies is not sufficient to

explain the annual rise or fall in market share of Bharti AIRTEL Nig. Ltd.

The F-statistics which measures the overall goodness of fit of the model is
106
positive and significant with a value of 5.364536. This simply means that

the model was fit for the type of test carried out. The R2 which is called

the coefficient of determination of the model shows the degree to which

the independent variable explains variations in the dependent variable.

Since the test involves more than one independent variable, the adjusted

R2 is used which gives a value of 0.492359; which is positive implying

that the independent variables jointly explain up to 49.24% of the total

variations in market share between the years of 2001 – 2010.

Finally in Table 4.8, ETISALAT’s advertising and marketing cost is

positive and insignificant with her market share. This is shown by the co-

efficient, t-statistic and probability values of 12.42203, 2.259829 and

0.1089 respectively. On the other hand, corporate social responsibility

(CSR) is negative and insignificantly related to market share as shown by

the coefficient, t-statistic and probability values of -173.8921, -2.259629

and 0.1090 respectively. Public relations strategy therefore does not

appear to have a significant relationship with market share or in other

words, the engagement of public relations activities and strategies is not

sufficient to explain the annual rise or fall in market share of ETISALAT

Nig. Ltd. The F-statistics which measures the overall goodness of fit of the

model is positive and significant with a value of 35.48879. This simply

means that the model was fit for the type of test carried out. The R2 which

is called the coefficient of determination of the model shows the degree to

107
which the independent variable explains variations in the dependent

variable. Since the test involves more than one independent variable, the

adjusted R2 is used which gives a value of 0.932412; which is positive

implying that the independent variables jointly explain up to 93.24% of

the total variations in market share between the years of 2005 – 2010. In

all therefore, we accept the null hypothesis that states that there’s no

significant relationship between public relations strategy and

organization’s market share.

4.3.3 Test Of Hypothesis 2

Null Hypothesis 2 (H02): There is no significant relationship between

public relations strategies and organization’s profitability

Alternate Hypothesis 2 (HA2): There is a significant relationship

between public relations strategies and organization’s profitability

108
TABLE 4.9: Multiple Regression Test results of Public Relations

Strategies and Profit after Tax (PAT) of MTN (2001 – 2010)

Dependent Variable: PAT_M

Method: Least Squares
Date: 02/16/12 Time: 09:15
Sample: 2001 2010
Included observations: 10

Variable Coefficient Std. Error t-Statistic Prob.

C -0.023139 0.019248 -1.202124 0.2684

ADMC_M 7.142859 2.50E-06 2861912. 0.0000
CSR_M -9.86E-06 1.71E-05 -0.577133 0.5819

R-squared 0.898945 Mean dependent var 190926.0

Adjusted R-squared 0.851786 S.D. dependent var 96114.77
S.E. of regression 0.017280 Akaike info criterion -5.035263
Sum squared resid 0.002090 Schwarz criterion -4.944488
Log likelihood 28.17632 F-statistic 1.39E+14
Durbin-Watson stat 2.684995 Prob(F-statistic) 0.000000

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

109
TABLE 4.10: Multiple Regression Test results of Public

Relations Strategies and PAT of GLO (2003 – 2010)

Dependent Variable: PAT_G

Method: Least Squares
Sample: 2003 2010
Included observations: 8

Variable Coefficient Std. Error t-Statistic Prob.

C 1.255483 0.974221 1.288705 0.2539

ADMC_G -8.607666 0.001739 -4950.998 0.0000
CSR_G 220.5062 0.023726 9293.809 0.0000

R-squared 0.638634 Mean dependent var 93176.92

Adjusted R-squared 0.594364 S.D. dependent var 51234.86
S.E. of regression 0.799541 Akaike info criterion 2.670438
Sum squared resid 3.196326 Schwarz criterion 2.700228
Log likelihood -7.681750 F-statistic 1.44E+10
Durbin-Watson stat 3.134996 Prob(F-statistic) 0.000000

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

110
TABLE 4.11: Multiple Regression Test results of Public

Relations Strategies and PAT of AIRTEL (2001 – 2010)

Dependent Variable: PAT_A

Method: Least Squares
Sample: 2001 2010
Included observations: 10

Variable Coefficient Std. Error t-Statistic Prob.

C 0.017624 0.015701 1.122426 0.2987

ADMC_A 7.109588 0.255980 27.77394 0.0000
CSR_A 0.465750 3.583722 0.129963 0.9003

R-squared 0.753421 Mean dependent var 68733.37

Adjusted R-squared 0.729854 S.D. dependent var 34601.32
S.E. of regression 0.021221 Akaike info criterion -4.624292
Sum squared resid 0.003152 Schwarz criterion -4.533517
Log likelihood 26.12146 F-statistic 1.20E+13
Durbin-Watson stat 2.455567 Prob(F-statistic) 0.000000
[
Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

111
TABLE 4.12: Multiple Regression Test results of Public

Relations Strategies and PAT of ETISALAT (2005 – 2010)

Dependent Variable: PAT_E

Method: Least Squares
Sample: 2005 2010
Included observations: 6

Variable Coefficient Std. Error t-Statistic Prob.

C 6.78E-05 0.011298 0.006003 0.9956

ADMC_E 7.035033 0.159935 43.98694 0.0000
CSR_E 1.509429 2.239071 0.674132 0.0000

R-squared 0.864343 Mean dependent var 18229.96

Adjusted R-squared 0.837649 S.D. dependent var 9560.284
S.E. of regression 0.011799 Akaike info criterion -5.734788
Sum squared resid 0.000418 Schwarz criterion -5.838908
Log likelihood 20.20436 F-statistic 1.642313
Durbin-Watson stat 3.169053 Prob(F-statistic) 0.000000

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

4.3.4 Hypothesis 2 Test Results Interpretation

In Table 4.9 above, MTN’s advertising and marketing cost is positive

and significant with her profit after tax (PAT). This is shown by the co-

efficient, t-statistic and probability values of 7.142859, 2861912 and

0.0000 respectively. On the other hand, corporate social responsibility

(CSR) is negative and insignificantly related to PAT as shown by the

coefficient, t-statistic and probability values of -9.86E-06 -0.577133 and

0.5819 respectively. These simply mean that a 1% increase in these

variables would cause a subsequent percentage increase as denoted by

their coefficient values. The F-statistics which measures the overall

112
goodness of fit of the model is positive with a value of 1.39E+14. The R2

which is called the coefficient of determination of the model shows the

degree to which the independent variable explains variations in the

dependent variable. Since the test involves more than one independent

variable, the adjusted R2 is used which gives a value of 0.851786; which is

positive implying that the independent variables jointly explain up to

85.18% of the total variations in PAT between the years of 2001 – 2010.

In Table 4.10, GLOBACOM’s advertising and marketing cost is

negative and significant with her PAT. This is shown by the co-efficient, t-

statistic and probability values of -8.607666, -4950.998 and 0.0000

respectively. On the other hand, corporate social responsibility (CSR) is

positive and significantly related to PAT as shown by the coefficient, t-

statistic and probability values of 220.5062, 9293.809 and 0.0000

respectively. Public relations strategy therefore appears to have a

significant relationship which is very strong with PAT or in other words,

the engagement of public relations activities and strategies is sufficient

enough to explain the annual rise or fall in the PAT of GLOBACOM Nig.

Ltd. The F-statistics which measures the overall goodness of fit of the

model is positive with a value of 1.44E+10. The R2 which is called the

coefficient of determination of the model shows the degree to which the

independent variable explains variations in the dependent variable. Since

the test involves more than one independent variable, the adjusted R2 is
113
used which gives a value of 0.594364; which is positive implying that the

independent variables jointly explain up to 59.44% of the total variations

in PAT between the years of 2003 – 2010.

In Table 4.11, AIRTEL’s advertising and marketing cost is positive

and significant with her PAT. This is shown by the co-efficient, t-statistic

and probability values of 7.109588, 27.77394 and 0.0000 respectively. On

the other hand, corporate social responsibility (CSR) is positive and

insignificantly related to PAT as shown by the coefficient, t-statistic and

probability values of 0.465750, 0.129963 and 0.9003 respectively. Public

relations strategy therefore appears to have a relationship with PAT or in

other words, the engagement of public relations activities and strategies

can explain the annual rise or fall in PAT of Bharti AIRTEL Nig. Ltd. The

F-statistics which measures the overall goodness of fit of the model is

positive with a value of 1.20E+13. The R2 which is called the coefficient of

determination of the model shows the degree to which the independent

variable explains variations in the dependent variable. Since the test

involves more than one independent variable, the adjusted R2 is used

which gives a value of 0.729854; which is positive implying that the

independent variables jointly explain up to 72.99% of the total variations

in PAT between the years of 2001 – 2010.

Finally in Table 4.12, ETISALAT’s advertising, marketing and

corporate social responsibility cost is positive and highly significant with

114
her PAT. This is shown by the co-efficient, t-statistic and probability

values of 7.035033, 1.509429, 0.159935, 2.239071 and 0.0000, 0.00000

respectively. Public relations strategy therefore appears to have a strong

and significant relationship with PAT or in other words, the engagement

of public relations activities and strategies is sufficient enough to explain

the annual rise or fall in PAT of ETISALAT Nig. Ltd. The F-statistics

which measures the overall goodness of fit of the model is positive and

significant with a value of 1.642313. This simply means that the model

was fit for the type of test carried out. The R2 which is called the

coefficient of determination of the model shows the degree to which the

independent variable explains variations in the dependent variable. Since

the test involves more than one independent variable, the adjusted R2 is

used which gives a value of 0.837649; which is positive implying that the

independent variables jointly explain up to 83.76% of the total variations

in market share between the years of 2005 – 2010. In all therefore, since

we evidenced more significant relationship, we reject the null hypothesis

and accept the alternate hypothesis which states that there’s a significant

relationship between public relations strategy and organization’s profit

after tax.

115
4.3.5 Test Of Hypothesis 3

Null Hypothesis 3 (H03): There is no significant relationship between

public relations strategies and organization’s change in profitability.

Alternate Hypothesis 3 (HA3): There is a significant relationship

between public relations strategies and organization’s change in

profitability.

TABLE 4.13: Multiple Regression Test results of Public

Relations Strategies and Change in Profit of MTN (2001 – 2010)

Dependent Variable: CPAT_M

Method: Least Squares
Sample: 2001 2010
Included observations: 10

Variable Coefficient Std. Error t-Statistic Prob.

C -44.24345 51.43910 -0.860113 0.4182

ADMC_M 0.008483 0.006670 1.271825 0.0244
CSR_M -0.055241 0.045649 -1.210117 0.0265

R-squared 0.193548 Mean dependent var 16.78800

Adjusted R-squared 0.136866 S.D. dependent var 45.34983
S.E. of regression 46.17820 Akaike info criterion 10.74622
Sum squared resid 14926.98 Schwarz criterion 10.83699
Log likelihood -50.73109 F-statistic 0.840000
Durbin-Watson stat 2.041081 Prob(F-statistic) 0.471003

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

116
TABLE 4.14: Multiple Regression Test results of Public

Relations Strategies and Change in Profit of GLO (2003 – 2010)

Dependent Variable: CPAT_G

Method: Least Squares
Sample: 2003 2010
Included observations: 8

Variable Coefficient Std. Error t-Statistic Prob.

C 13.70830 21.28416 0.644061 0.5479

ADMC_G 0.019208 0.037983 0.505695 0.0001
CSR_G 0.265553 0.518354 0.512301 0.0000

R-squared 0.351124 Mean dependent var 8.866250

Adjusted R-squared 0.314427 S.D. dependent var 15.23601
S.E. of regression 17.46785 Akaike info criterion 8.838598
Sum squared resid 1525.630 Schwarz criterion 8.868389
Log likelihood -32.35439 F-statistic 0.162757
Durbin-Watson stat 3.085642 Prob(F-statistic) 0.004124

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

117
TABLE 4.15: Multiple Regression Test results of Pub. Relations

Strategies and Change in Profit of AIRTEL (2001 – 2010)

Dependent Variable: CPAT_A

Method: Least Squares
Sample: 2001 2010
Included observations: 10

Variable Coefficient Std. Error t-Statistic Prob.

C -0.955416 12.32634 -0.077510 0.9404

ADMC_A 240.1459 200.9572 1.195010 0.0271
CSR_A -3362.030 2813.397 -1.195007 0.0271

R-squared 0.190066 Mean dependent var 6.043000

Adjusted R-squared 0.141343 S.D. dependent var 16.32574
S.E. of regression 16.65980 Akaike info criterion 8.707200
Sum squared resid 1942.843 Schwarz criterion 8.797975
Log likelihood -40.53600 F-statistic 0.821342
Durbin-Watson stat 2.302808 Prob(F-statistic) 0.008160

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

118
TABLE 4.16: Multiple Regression Test results of Pub. Relations

Strategies and Change in Profit of ETISALAT (2005 – 2010)

Dependent Variable: CPAT_E

Method: Least Squares
Sample: 2005 2010
Included observations: 6

Variable Coefficient Std. Error t-Statistic Prob.

C 0.671411 3.413136 0.196714 0.8566

ADMC_E 15.50125 48.31493 0.320838 0.7694
CSR_E 217.0124 676.4051 -0.320832 0.7694

R-squared 0.659718 Mean dependent var 1.551667

Adjusted R-squared 0.583804 S.D. dependent var 2.832211
S.E. of regression 3.564316 Akaike info criterion 5.686674
Sum squared resid 38.11305 Schwarz criterion 5.582554
Log likelihood -14.06002 F-statistic 0.078478
Durbin-Watson stat 2.355238 Prob(F-statistic) 0.000058

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

4.3.6 Hypothesis 3 Test Results Interpretation

In Table 4.13 above, MTN’s advertising and marketing cost is

positive and significant with her change in profit after tax (PAT). This is

shown by the co-efficient, t-statistic and probability values of 0.008483,

1.271825 and 0.0244 respectively. On the other hand, corporate social

responsibility (CSR) is negative and significantly related to change in PAT

as shown by the coefficient, t-statistic and probability values of -0.055241

-1.210117 and 0.0265 respectively. These simply mean that a 1% increase

in these variables would cause a subsequent percentage increase as

denoted by their coefficient values. The F-statistics which measures the

119
overall goodness of fit of the model is positive with a value of 0.840000.

The R2 which is called the coefficient of determination of the model

shows the degree to which the independent variable explains variations in

the dependent variable. Since the test involves more than one

independent variable, the adjusted R2 is used which gives a value of

0.136866; which is positive implying that the independent variables

jointly explain up to 13.69% of the total variations of change in PAT of

MTN between the years of 2001 – 2010.

In Table 4.14, GLOBACOM’s advertising, marketing and corporate

social responsibility (CSR) cost is positive and significant with her change

in PAT. This is shown by their co-efficient, t-statistic and probability

values of 0.019208, 0.265553, 0.505695, 0.512301 and 0.0001, 0.0000

respectively. Public relations strategy therefore appears to have a

significant relationship which is very strong with change in PAT or in

other words, the engagement of public relations activities and strategies is

sufficient enough to explain the annual rise or fall in the change in PAT of

GLOBACOM Nig. Ltd. The F-statistics which measures the overall

goodness of fit of the model is positive with a value of 0.162757. The R2

which is called the coefficient of determination of the model shows the

degree to which the independent variable explains variations in the

dependent variable. Since the test involves more than one independent

variable, the adjusted R2 is used which gives a value of 0.314427; which is

120
positive implying that the independent variables jointly explain up to

31.44% of the total variations of the change in PAT of GLOBACOM Nig.

Ltd. between the years of 2003 – 2010.

In Table 4.15, AIRTEL’s advertising and marketing cost is positive

and significant with her change in PAT. This is shown by the co-efficient,

t-statistic and probability values of 240.1459, 1.195010 and 0.0271

respectively. On the other hand, corporate social responsibility (CSR) is

negative and significantly related to change in PAT as shown by the

coefficient, t-statistic and probability values of -3362.030, -1.195007 and

0.0271 respectively. Public relations strategy therefore appears to have a

relationship with change in PAT even though a negative one, as in the case

of the cost if CSR. The F-statistics which measures the overall goodness of

fit of the model is positive with a value of 0.821342. The R2 which is

called the coefficient of determination of the model shows the degree to

which the independent variable explains variations in the dependent

variable. Since the test involves more than one independent variable, the

adjusted R2 is used which gives a value of 0.141343; which is positive

implying that the independent variables jointly explain up to 14.13% of the

total variations in change in PAT between the years of 2001 – 2010.

Finally in Table 4.16, ETISALAT’s advertising, marketing and

corporate social responsibility cost is positive and insignificant with her

change in PAT. This is shown by the co-efficient, t-statistic and

121
probability values of 15.50125, 217.0124, 0.320838, 0.320832 and 0.7694,

0.7694 respectively. Public relations strategy therefore appears to have a

relationship although insignificant with the change in PAT of ETISALAT

Nig. Ltd. or in other words, the engagement of public relations activities

and strategies is sufficient enough to explain the annual rise or fall in PAT

of ETISALAT Nig. Ltd. The F-statistics which measures the overall

goodness of fit of the model is positive and significant with a value of

0.078478. This simply means that the model was fit for the type of test

carried out. The R2 which is called the coefficient of determination of the

model shows the degree to which the independent variable explains

variations in the dependent variable. Since the test involves more than

one independent variable, the adjusted R2 is used which gives a value of

0.583804; which is positive implying that the independent variables

jointly explain up to 58.38% of the total variations in market share

between the years of 2005 – 2010. In all therefore, since we evidenced

more significant relationship, we reject the null hypothesis and accept the

alternate hypothesis which states that there’s a significant relationship

between public relations strategy and organization’s change in profit.

122
4.3.7 Test Of Hypothesis 4

Null Hypothesis 4 (H04): There is no significant relationship between

public relations strategies and an organization’s Goodwill.

Alternate Hypothesis 4 (HA4): There is a significant relationship

between public relations strategies and an organization’s Goodwill.

TABLE 4.17: Multiple Regression Test results of Public

Relations Strategies and Goodwill of MTN (2001 – 2010)

Dependent Variable: GDWL_M

Method: Least Squares
Sample: 2001 2010
Included observations: 10

Variable Coefficient Std. Error t-Statistic Prob.

C 232250.9 157056.1 1.478777 0.1827

ADMC_M 18.97458 20.36490 0.931729 0.3825
CSR_M 0.187792 139.3779 0.001347 0.9990

R-squared 0.808733 Mean dependent var 275496.2

Adjusted R-squared 0.754085 S.D. dependent var 284319.1
S.E. of regression 140993.3 Akaike info criterion 26.79414
Sum squared resid 1.39E+11 Schwarz criterion 26.88491
Log likelihood -130.9707 F-statistic 14.79901
Durbin-Watson stat 1.348523 Prob(F-statistic) 0.003060

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

123
TABLE 4.18: Multiple Regression Test results of Public

Relations Strategies and Goodwill of GLO (2003 – 2010)

Dependent Variable: GDWL_G

Method: Least Squares
Sample: 2003 2010
Included observations: 8

Variable Coefficient Std. Error t-Statistic Prob.

C 111245.1 80314.30 1.385122 0.2246

ADMC_G 134.6177 143.3270 0.939235 0.3907
CSR_G 1610.261 1955.972 0.823254 0.4478

R-squared 0.809464 Mean dependent var 158325.7

Adjusted R-squared 0.733250 S.D. dependent var 127621.5
S.E. of regression 65913.74 Akaike info criterion 25.31008
Sum squared resid 2.17E+10 Schwarz criterion 25.33987
Log likelihood -98.24031 F-statistic 10.62090
Durbin-Watson stat 1.066881 Prob(F-statistic) 0.015847

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

124
TABLE 4.19: Multiple Regression Test results of Public

Relations Strategies and Goodwill of AIRTEL (2001 – 2010)

Dependent Variable: GDWL_A

Method: Least Squares
Sample: 2001 2010
Included observations: 10

Variable Coefficient Std. Error t-Statistic Prob.

C -90374.47 31924.96 -2.830841 0.0254

ADMC_A 853101.8 520475.1 1.639083 0.1452
CSR_A -11943143 7286642. -1.639046 0.1452

R-squared 0.861780 Mean dependent var 99178.61

Adjusted R-squared 0.822289 S.D. dependent var 102354.9
S.E. of regression 43148.55 Akaike info criterion 24.42601
Sum squared resid 1.30E+10 Schwarz criterion 24.51679
Log likelihood -119.1301 F-statistic 21.82195
Durbin-Watson stat 2.147812 Prob(F-statistic) 0.000982

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

125
TABLE 4.20: Multiple Regression Test results of Public

Relations Strategies and Goodwill of ETISALAT (2005 – 2010)

Dependent Variable: GDWL_E

Method: Least Squares
Sample: 2005 2010
Included observations: 6

Variable Coefficient Std. Error t-Statistic Prob.

C 12520.43 8692.711 1.440337 0.2454

ADMC_E 40890.83 123050.4 0.332310 0.0015
CSR_E 572607.8 1722695. 0.332391 0.0015

R-squared 0.784141 Mean dependent var 37487.32

Adjusted R-squared 0.640236 S.D. dependent var 15134.52
S.E. of regression 9077.742 Akaike info criterion 21.37189
Sum squared resid 2.47E+08 Schwarz criterion 21.26777
Log likelihood -61.11567 F-statistic 5.448994
Durbin-Watson stat 1.147571 Prob(F-statistic) 0.100289

Source: Researcher’s Computation using Econometric Views (E-Views) 3.1

126
4.3.8 Hypothesis 4 Test Results Interpretation

In Table 4.17 above, MTN’s advertising and marketing cost is

positive and insignificantly related to her Goodwill. This is shown by the

co-efficient, t-statistic and probability values of 18.97458, 0.931729 and

0.03825 respectively. On the other hand, corporate social responsibility

(CSR) is positive and also insignificantly related to her Goodwill as shown

by the coefficient, t-statistic and probability values of 0.187792, 0.001347

and 0.9990 respectively. These simply mean that a 1% increase in these

variables would cause a subsequent percentage increase as denoted by

their coefficient values. The F-statistics which measures the overall

goodness of fit of the model is positive and significant with a value of

14.79901. The R2 which is called the coefficient of determination of the

model shows the degree to which the independent variable explains

variations in the dependent variable. Since the test involves more than

one independent variable, the adjusted R2 is used which gives a value of

0.754085; which is positive implying that the independent variables

jointly explain up to 75.41% of the total variations of Goodwill of MTN

between the years of 2001 – 2010.

In Table 4.18, GLOBACOM’s advertising, marketing and corporate

social responsibility (CSR) cost is positive and insignificant with her

Goodwill. This is shown by their co-efficient, t-statistic and probability

values of 134.6177, 1610.261, 0.939235, 0.823254 and 0.3907, 0.4478

127
respectively. Public relations strategy therefore appears to have a positive

and insignificant relationship with Goodwill or in other words, the

engagement of public relations activities and strategies is sufficient

enough to explain the annual rise or fall in the Goodwill of GLOBACOM

Nig. Ltd., although insignificant. The F-statistics which measures the

overall goodness of fit of the model is positive and significant with a value

of 10.62090. The R2 which is called the coefficient of determination of the

model shows the degree to which the independent variable explains

variations in the dependent variable. Since the test involves more than

one independent variable, the adjusted R2 is used which gives a value of

0.733250; which is positive implying that the independent variables

jointly explain up to 73.33% of the total variations of Goodwill of

GLOBACOM Nig. Ltd. between the years of 2003 – 2010.

In Table 4.19, AIRTEL’s advertising and marketing cost is positive

and significant with her Goodwill. This is shown by the co-efficient, t-

statistic and probability values of 853101.8, 1.639083 and 0.1452

respectively. On the other hand, corporate social responsibility (CSR) is

negative andin significantly related to Goodwill as shown by the

coefficient, t-statistic and probability values of -11943143, -1.639046 and

0.1452 respectively. Public relations strategy therefore appears to have

both a negative and positive relationship although insignificant with

Goodwill of Bharti AIRTEL Nig. Ltd. The F-statistics which measures the
128
overall goodness of fit of the model is positive and significant with a value

of 21.82195. The R2 which is called the coefficient of determination of the

model shows the degree to which the independent variable explains

variations in the dependent variable. Since the test involves more than

one independent variable, the adjusted R2 is used which gives a value of

0.822289; which is positive implying that the independent variables

jointly explain up to 82.23% of the total variations in Goodwill between

the years of 2001 – 2010.

Finally in Table 4.20, ETISALAT’s advertising, marketing and

corporate social responsibility cost is positive and significant with her

Goodwill. This is shown by the co-efficient, t-statistic and probability

values of 40890.83, 572607.8, 0.332310, 0.332391 and 0.0015, 0.0015

respectively. Public relations strategy therefore appears to have a

relationship with Goodwill of ETISALAT Nig. Ltd. or in other words, the

engagement of public relations activities and strategies is sufficient

enough to explain the annual rise or fall in Goodwill of ETISALAT Nig.

Ltd. The F-statistics which measures the overall goodness of fit of the

model is positive and significant with a value of 5.448994. This simply

means that the model was fit for the type of test carried out. The R2 which

is called the coefficient of determination of the model shows the degree to

which the independent variable explains variations in the dependent

variable. Since the test involves more than one independent variable, the
129
adjusted R2 is used which gives a value of 0.640236; which is positive

implying that the independent variables jointly explain up to 64.02% of

the total variations in market share between the years of 2005 – 2010. In

all therefore, based on the result of the regression analysis carried out, we

can accept the null hypothesis for the first three firms; MTN, GLOBACOM

and Bharti AIRTEL at the same time, reject the null hypothesis for the last

firm ETISALAT.

130
 References

Bharti AIRTEL Nig. Ltd. (2010); Annual Reports and Accounts (2001 –

2010) http://www.airtel.com

CELTEL Nig. Ltd. (2006 and 2007); Annual Reports and Accounts;

http://www.zain.com.

ECONET, VODACOM/Vee Networks Ltd. (2001, 2002, 2003, 2004 and

2005); Annual Reports and Accounts; http:// www.econet.com.

GLOBACOM Nig. Ltd. (various issues). Annual Reports and Accounts

(2003 – 2010). http://www.globacom.com.

MTN Nig. Ltd. (various issues). Annual Reports and Accounts (2001 –

2010). http:// www.mtn.com

Ogolo M. B. (1996, 2007). Students’ Guide to Writing Research and

Project Proposals; Port Harcourt. City-Creeks Publishers.

ZAIN Nig. Ltd. (2008 and 2009); Annual Reports and Accounts;

http://www.zain.com.
 CHAPTER FIVE

DISCUSSION OF FINDINGS, CONCLUSION AND

RECOMMENDATION

5.1 Introduction

In this section, the discussion of findings, conclusion of the study

and recommendations for GSM industry are presented.

5.2 Discussion of Findings

This study has tried to discover the relationship between public

relations strategies and marketing performance of the GSM industry in

Nigeria. It selected the four major GSM mobile operators in Nigeria and

tested the hypotheses on each of them to find out relatively, the

relationship between the two variables specifically on their companies.

This study provided varying findings; It was found out that public

relations strategies did not have any significant relationship with the

market share of MTN Nigeria, GLOBACOM Nig Ltd, Bharti-AIRTEL and

ETISATAT Nig.ltd.

In MTN Nigeria, it was discovered that advertising has a significant

relationship with their profitability while CSR was found to be

89
insignificantly related to their profitability. On the other hand, in

GLOBACOM Nig ltd, both advertising and CSR were found to have a

significant relationship with their profitability. Meanwhile, in Bharti

AIRTEL, their advertising activities were found to have a significant

relationship with their profitability while the relationship between their

CSR activities and their profitability was discovered to be insignificant.

On change in profitability, it was found out in MTN Nigeria that

both their advertising and CSR activities had a significant relationship

with the change in their organization’s profitability. The advertising and

CSR activities of GLOBACOM Nigeria ltd. were discovered to be strongly

and significantly related with their change in profitability. Bharti AIRTEL

showed a significant relationship between advertising, CSR and their

change in profitability. In ETISALAT, it was found out that their

advertising and CSR activities had insignificant relationships

respectively, with their change in profitability.

Going on to goodwill, MTN Nigeria displayed insignificant

relationships between both advertising and CSR activities, and the

goodwill of their company. GLOBACOM Nig.Ltd. also showed that there

was an insignificant relationship between both their advertising and CSR

activities and their goodwill.Meanwhile.in Bharti AIRTEL, their

advertising activities had a significant relationship with their goodwill,

while, the relationship between their CSR activities and their goodwill was

90
found to be insignificant. Both ETISALAT’s advertising and CSR activities

were discovered to be significantly related with their goodwill.

The implication of all these findings is that public relations

strategies do have an effect on the marketing performance of the GSM

industry in Nigeria. However, how significant the relationship is, depends

on the individual companies themselves.

5.3 Conclusion

The study focused on the relationship between public relations

strategies and marketing performance in the GSM industry in Nigeria

with a view to checking if the application of selected public relations

strategies are sufficient enough to explain the annual rise and fall in the

selected indicators of marketing performance. Based on the findings, the

researcher is of the opinion that public relations strategies have a

relationship with marketing performance indicators, although some of the

findings indicate that this relationship fluctuates as it concerns each

company in the industry respectively.

Despite the work done so far in the study, there’s still a need for

extensive research especially as a dearth in literature of this subject

abounds. Interesting points for research is the reason why both

advertising and CSR activities have not shown significant relationship

with Market share, exploration on other public relations activities to see

91
which one of them does actually enhance market share, how to effectively

enhance and increase the goodwill generated by the GSM industry, using

other public relations strategies.

5.4 Recommendations

Based on the discussion of findings of the study, the following

recommendations were proffered by the researcher.

1. The GSM operators should encourage and embrace the use of

public relations strategies as it has a positive impact on their

marketing performance.

2. The GSM industry should focus more on how they can improve

on their CSR activities, since their corporate citizenship is

imperative for continual success in the firm.

92
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