Abstract
Background: Advertisements constitute one of the principal tools organizations use in securing and retaining customers. This study assessed the effect of word of mouth advertising on product marketing in selected companies in the Ashanti region of Ghana. Data were obtained through a cross-sectional multistage sampling process. Methods: Ten (10) companies were purposely selected out of which 100 participants made up of both customers and staff of the companies was recruited at random and data collected through a simple closed ended questionnaire. Simple descriptive statistics were employed in characterizing the respondents and responses given. This was supported with standard multivariate regression analyses to detect the predictive powers of different mediums of word of mouth advertisement on sales margin and profitability. Results: In the cross-sectional analyses, telephone communication demonstrated significant direct effect on high sales margins (beta = 0.726, t = 7.463, p < 0.000). Face to face communication is the most frequent word of mouth communication channel. Our model suggest that controlling for face to face communication, social networking, lectures, conference and seminars, telephones as a medium explains 72.6 percent of the variance in sales margin. Conclusion: Using the phone as a communication tool in advertising goods and services and for the companies has direct positive impact on the level of sales than other forms of word of mouth advertisement.
Highlights
Advertisements constitute one of the principal tools organizations use in securing and retaining customers
Our model suggest that controlling for face to face communication, social networking, lectures, conference and seminars, telephones as a medium explains 72.6 percent of the variance in sales margin
Word of mouth advertisement is beginning to emerge as a great tool in the general marketing industry despite the limited research focus it has received in the past
Summary
Advertisements constitute one of the principal tools organizations use in securing and retaining customers. This study assessed the effect of word of mouth advertising on product marketing in selected companies in the Ashanti region of Ghana. Simple descriptive statistics were employed in characterizing the respondents and responses given This was supported with standard multivariate regression analyses to detect the predictive powers of different mediums of word of mouth advertisement on sales margin and profitability. Results: In the cross-sectional analyses, telephone communication demonstrated significant direct effect on high sales margins (beta = 0.726, t = 7.463, p < 0.000). Conclusion: Using the phone as a communication tool in advertising goods and services and for the companies has direct positive impact on the level of sales than other forms of word of mouth advertisement. As defined by Engel et al (1993), consumer behaviour applies to those activities directly involved in obtaining, consuming and disposing of products and services, including the decision process that precedes and follow these actions. Engel et al (1993) further identify a five stage process; the problem recognition stage, information search stage, evaluation of alternatives, purchase and post purchase evaluation
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