IMPACT OF FAKE DECEPTIVE ADVERTISING ON CUSTOMER PURCHASING INTENTION IN NIGERIA
CHAPTER ONE
INTRODUCTION
BACKGROUND OF STUDY
The essence of being in business by any business outfits is to produce for sales and profits. In order to remain in business an organization must generate enough sales from its products to cover operating costs and post reasonable profits. For many organizations, sales estimate is the starting point in budgeting or profit planning. It is so because it must be determined, in most cases, before production units could be arrived at while production units will in turn affect material purchases. However, taking decision on sales is the most difficult tasks facing many business executives. This is because it is difficult to predict, estimate or determine with accuracy, potential customers’ demands as they are uncontrollable factors external to an organization. Considering, therefore, the importance of sales on business survival and the connection between customers and sales, it is expedient for organizations to engage in programmes that can influence consumers’ decision to purchase its products. This is where advertising and brand management are relevant. Advertising is a subset of promotion mix which is one of the 4ps in the marketing mix i.e product, price, place and promotion. As a promotional strategy, advertising serve as a major tool in creating product awareness and condition the mind of a potential consumer to take eventual purchase decision.
DECEPTION IN ADVERTISEMENT
Deception’ through the advertisement is a common phenomenon today. Among others some of the Advertisers published the misleading, fraudulent and deceptive advertisement through mass media such as TV, radio, bill boards, sigh boards, transportation, satellite channels and so on. Some deceptive and fraudulent products are sale for some complex diseases like Agma, cancer, diabetics, etc for which company are offering strong guarantee to cure these complex those diseases through their Advertisements within very short period of time. Sometimes they are publishing their Advertising through mass Medias not only for above diseases, but guaranteed to solve all kinds of physical and mental problems by single doges of medicines or through their (Addatik) power.
Most of the peoples of Bangladesh are illiterate and unaware of their health, it is easy to capture the targeted group by dint of these deceptive advertising. According to the experts, all these advertising are deceptive and should take necessary measure to prevent all types of mal-practice.
DEFINITION OF ADVERTISING
Advertising, sales promotion and public relations are mass-communication tools available to marketers. As its name suggests, mass communication uses the same message for everyone in an audience. The mass communication tools trade off the advantage of personal selling, the opportunity to tailor a message to each prospect, for the advantage of reaching many people at a lower cost per person (Etzel et al., 1997). Today, definitions of advertising abound. We might define it as communication process, a marketing process, an economic and social process, a public relations process or an information and persuasion process (Arens, 1996). Dunn et al. (1978) viewed advertising from its functional perspectives, hence they define it as a paid, non-personal communication through various media by business firms, non-profit organization, and individuals who are in some way identified in the advertising message and who hope to inform or persuade members of a particular audience. Morden (1991) is of the opinion that advertising is used to establish a basic awareness of the product or service in the mind of the potential customer and to build up knowledge about it. Kotler (1988) sees advertising as one of the four major tools companies use to direct persuasive communications to target buyers and public noting that “it consists of non-personal forms of communication conducted through paid media under clear sponsorship”. According to him, the purpose of advertising is to enhance potential buyers’ responses to the organization and its offering, emphasizing that “it seeks to do this providing information, by channeling desire, and by supplying reasons for preferring a particular organization’s offer. While writing on advertising nature and scope, Etzel et al. (1997) succinctly capture all advertising as having four features: (i) A verbal and or visual message (ii) A sponsor who is identified (iii) Delivery through one or more media (iv) Payment by the sponsor to the media carrying the message. Summarizing the above, they conclude that “advertising then consist of all the activities involved in presenting to an audience a nonpersonal, sponsor-identified, paid-for message about a product or organization”. Those views of Etzel et al. (1997) coincide with the simple but all-embracing definitions of Davies (1998) and Arens (1996). For instance, while Davies states that “advertising is any paid form of non-personal media presentation promoting ideas/concepts, good s or services by an identified sponsor. Arens expressing almost the same view describes advertising as “the personal communication of information usually paid for and usually persuasive in nature about products (goods and services) or ideas by identified sponsors through various media”. From the foregoing, it could be concluded that the purpose of advertising is to cerate awareness of the advertised product and provide information that will assist the consumer to make purchase decision, the relevance of advertising as a promotional strategy, therefore, depends on its ability to influence consumer not only to purchase but to continue to repurchase and eventually develop-brand loyalty. Consequently, many organizations expend a huge amount of money on advertising and brand management. A brand is a name given by a manufacturer to one (or a number) of its products or services. Brands are used to differentiate products from their competitors. They facilitate recognition and where customers have built up favorable attitude towards the product, may speed the individua buyers through the purchase decision process. Individual purchasers will filter out unfavourable or un-known brands and the continued purchase of the branded product will reinforce the brandloyal behaviour. Without brands, consumer couldn’t tell one product from another and advertising then would be nearly impossible. Advertising and Consumer Behaviour Advertiser’s primary mission is to reach prospective customers and influence their awareness, attitudes and buying behaviour. They spend a lot of money to keep individuals (markets) interested in their products. To succeed, they need to understand what makes potential customers behave the way they do. The advertisers goals is to get enough relevant market data to develop accurate profiles of buyers-to-find the common group (and symbols) for communications this involves the study of consumers behaviour: the mental and emotional processes and the physical activities of people who purchase and use goods and services to satisfy particular needs and wants (Arens, 1996). Proctor et al. (1982) noted that the principal aim of consumer behaviour analysis is to explain why consumers act in particular ways under certain circumstances. It tries to determine the factors that influence consumer behaviour, especially the economic, social and psychological aspects which can indicate the most favoured marketing mix that management should select. Consumer behaviour analysis helps to determine the direction that consumer behaviour is likely to make and to give preferred trends in product development, attributes of the alternative communication method etc. consumer behaviours analysis views the consumer as another variable in the marketing sequence, a variable that cannot be controlled and that will interprete the product or service not only in terms of the physical characteristics, but in the context of this image according to the social and psychological makeup of that individual consumer (or group of consumers). Economic theory has sought to establish relationships between selling prices, sales achieved and consumers income, similarly, advertising expenditure is frequently compared with sales. On other occasions financial accounting principles maybe applied to analyse profit and losses. Management ratios, net profit before tax, liquidity and solvency ratios can all be investigated.
Deception in reality is a more vital subject in marketing and consumer research than is shown is present literature. After much insight into the different but limited writings on deception in humanities, social sciences, marketing etc, this research came about “The use of strategic deception in telecommunication advert campaigns in Nigeria”. Deception in advertising is described as a company’s misrepresentation to customers on the features of the product or service advertised thus the anticipated utility from making use of the product or service (Nagler, 1993). Federal Trade Commission’s (FTC) policy states that an advert is seen as “deceptive” if there is an omission, representation, practice or act organized by a corporation that is prone to deceive a customer.(FTC , 1984).
Hence, Successful advertising is however almost always persuasive advertising, persuasion is therefore defined as the means of attempting to change or modify the significant beliefs, values, actions and wants of consumers; social life is occupied by unconscious and conscious, strong or substantial shots at persuasion (John O’Shaughnessy et al, 2004). In a competitive market those who persuade consumers best are those with a higher possibility to win. Persuasion is very essential even in situations where competition is hopeless.
This research aims to explore the strategic use of deception in telecommunications advert campaigns, as a major technique for persuasion in a very competitive environment like Nigeria. This research has selected telecommunication advert campaigns as sample of the study as it is said or believed to engage in a lot of marketing communications, especially TV and Print advertising. Nigeria has been recognized as the largest telecom market in all of Africa in the past years; its telecom sector is experiencing rapid transformation as a result of explosive progression and speedy infrastructure expansions. The telecom sector Liberalization along with augmented competition among operators have fetched significantly large benefits to the customers in terms of reduced subscription rates and heightened choice. However, the Nigerian Government is putting in all efforts to convert or alter the country’s economy into an economy that is knowledge based (RNCOS, 2012).
According to the research carried out by (RNCOS, 2012) it was recognized that competition among several telecom operators is expanding as they seek new business growth and customer retention techniques to maintain and acquire higher market share. Therefore, operators are assertively driving placement of network infrastructure, which is however pushing investments in Nigeria’s telecoms sector. The research also shows a summary of the competitive background, in which the top industry operators have been reported alongside their marketing techniques.
Currently, MTN, Airtel, MTEL, Etisalat and Globacom Limited lead the GSM industry in Nigeria (Tella et al, 2007). According to (NCC,2012 ), MTN holds over 46% of the market share with 41,641,089 subscribers while Globacom holds over 22% of the market share with about 19,886,014 subscribers also Airtel holds 20% of the market share with 18,028,385 subscribers while Etisalat holds 12% of the market share with 10,752,230 subscribers. This makes MTN the number one leader while Globacom the second leader in the telecoms industry.
NIGERIAN TELECOMMUNICATION ADVERTISING
Telecom advertising is a provisional section of the marketing procedure that is used to promote sales by triggering excitement and granting various incentives to customer, thereby persuading the customers to make a progressive decision. Advertising and promotions are the main methods utilized in selling telecom services to consumers in Nigeria. Advertising gives justification to use the services provided by a service operator whereas the sales promotions give incentives which are short term for the customers or subscribers to take on the services available (Ogungbe,2011).
Telecom promotional campaign is often put together to persuade consumers that the products and services provided by the service operators are necessary for their satisfaction. Marketers attempt to convince consumers/subscribers by presenting draws, stringing to the rise of lucky winners of numerous gift items like power generators, refrigerators, cars, television sets, recharge cards, cell phones and cash awards. These are the kind of incentives Nigerians look forward to owning; therefore lots of consumers participate in the draw which considerably increases the service operators or providers sale. Consequently, the Telecom sales objective is generally met, just like other sales promotions, is to rise above the actual sales quota (Ogungbe, 2011).
Telecom sales promotions function directly with advertising which is a major part of marketing. It however incorporates a large number of techniques which includes special price reduction, (Glo to Glo calls), competitions (projections in the course of a football match), games, rebates, premiums, gifts and lotteries etc. The promotional messages are generally passed across to consumers in a persuasive and convincing style and language via text messages, newspapers, television and radio (Ogungbe, 2011).
Deception in advertising has been of immense concern for a lot of policy makers and consumers. As soon as customers trust an advert to be factual when it is in fact false, customers may be hurt (Attas, 1999). Customers like their belief to be factual and if a customer is persuaded by an advert, then the customer might be interested in buying the product advertised or enter for the promotion advertised. Possibly more customers will purchase the product due to deceptive advert claims since they trust it to be of better significance i.e the customers tend to give more than the actual price for the product. (Attas, 1999). In addition, the company trades even more products at the standard price. This logic tries to propose that companies are firmly crafting and posting uncertain, deceitful ads; and customers are purchasing products and entering promotions trusting these companies deception; therefore companies are attaining a lot of revenue at the expense of a deceived populace. Which means, some companies many have executed a strategy meant to mislead customers into trusting that a product or service is more attractive than what it actually is just for the benefit of improved sales (Attas, 1999).
STATEMENT OF PROBLEM
Using some sort of deception in advertising in an attempt to gain customers does not bode well for your company’s eventual success, according to the Better Business Bureau. When profit is the only aim, companies tend to lean on ads that use misleading images, omit important facts and conceal hidden costs to convince consumers to purchase a product or service. This type of marketing deprives consumers of the truthful information needed to make informed decisions — and the harmful effects cascade along the chain of business.
CONSUMERS SUFFER
The first and most noticeable negative effect of deceptive advertising is that it leads consumers to make uninformed decisions. If consumers are not being told the whole truth or are being shown images that contradict or overshadow the actual traits of a product or service, they are unlikely to make the best decisions for themselves. They may waste money on a product or service that can’t provide what they are looking for, or they might be unaware of the pitfalls involved in the product or service. Harmful, deceptive ads may involve apparent guarantees that are contradicted in fine print, false warranties, hidden costs or serious health risks.
BUSINESSES SUFFER
At first glance, it might seem like deceptive advertising harms consumers and ends up benefiting businesses that employ the practice. But deceptive advertising often does significant, even fatal, harm to companies that use it. Consumers do not like being conned, and oftentimes they will retaliate against companies that trick them. Most people will not fall for the same trick more than once. Moreover, an angry and disappointed customer will often retaliate with negative word of mouth, attacks on social media and, on occasion, lawsuits.
EMPLOYEES SUFFER
Employees of companies that use deceptive advertising can end up bearing the consequences. They get stuck between the customer and the advertising. The employees usually don’t t write the ads or endorse them, but when consumers are angered by deceptive advertising, they have to deal with unhappy people. Customers might direct their ire at employees who can’t possibly live up to the unrealistic expectations generated by deceptive ads. They may even be directly blamed for a malfunctioning product. When employees are subjected to unpleasant conditions, they are likely to leave or to not work as hard, providing more problems for the company.
DISTORTED COMPETITION
The effect on competition might be one of the worst results of deceptive advertising. Competition between companies should benefit the consumer by providing better products at lower cost. It can benefit entire industries by encouraging innovation and exploration. Competition forces companies to get creative and to spend money on researching and developing newer and better services and products. However, if your competitor is spending money on making false but attractive claims about their products, for example, it may seem prudent and competitively intelligent for your company to invest in deceptive advertising rather than in innovation and creativity.
RESEARCH AIMS AND OBJECTIVES
1.To examine the likely presence of deceptive traits in telecommunication advert campaigns in Nigeria for the sole purpose of persuasion to bridge competition,
2.To expatiate on the idea of strategic deception in advertising.
3.To explore the likely effects of deceptive advertising on consumers.
4.To investigates the use of strategic deception in telecommunication advert campaigns and its likely effects on consumers.
RESEARCH QUESTION
- What are deceptive traits presence in telecommunication advert campaigns in Nigeria for the sole purpose of persuasion to bridge competition?
- What are the idea of strategic deception in advertising.
- What is the effects of deceptive advertising on consumers.
4.What is strategic deception in telecommunication advert campaigns and its likely effects on consumers.
SIGNIFICANCE OF THE STUDY
The studied expression on Impact of Deceptive Marketing on Consumer’s Behavior is examined by the activities which regulates misleading marketing and protects consumers’ rights’ misused in this area. Furthermore, it is provided the importance of the application of the guidelines in national law. There are highlighted the most common misleading conditions, as well as provided methods for safeguarding consumer protection against misleading promotion. Also, are presented recommendations on how to improve consumer protection field in relation to misleading publicity.
SCOPE OF STUDY
Globacom is the second largest telecommunication firm in Nigeria. Globacom Limited (or GLO) is a Nigerian multinational telecommunications company headquartered in Lagos. GLO is a privately owned telecommunications carrier that started operations on 29 August 2003. It currently operates in four countries in West Africa, namely Nigeria, Republic of Benin, Ghana and Côte d’Ivoire.As of June 2009, the company has employed more than 2,500 people worldwide.
DEFINITION OF TERMS
DECEPTIVE ADVERTISEMENT :Deceptive or false advertising is the use of misleading, false, or unproven information to advertise products to consumers or advertising that does not disclose its source. One form of false advertising is to claim that a product has a health benefit or contains vitamins or minerals that it in fact does not. Many governments use regulations to control false advertising. A false advertisement can further be classified as deceptive if the advertiser deliberately misleads the consumer, as opposed to making an honest mistake.
CONSUMER PURCHASING INTENTION :The ability for goods and services to be purchase by a particular consumer