IMPACT OF E-MARKETING ON THE PERFORMANCE OF SMALL AND MEDIUM SCALE ENTERPRISES

ABSTRACT

This study was carried out on the impact of e-marketing on the performance of small and medium scale enterprises (SMEs) in Nigeria using Selected SMEs in Lagos state hub as a case study. The survey design was adopted and the simple random sampling techniques were employed in this study. The population size comprise of the staff of Selected SMEs in Nigeria. In determining the sample size, the researcher made use of the Taro Yamane formula to selected 133 respondents and all were validated. Self-constructed and validated questionnaire was used for data collection. The collected and validated questionnaires were analyzed using frequency tables. While the hypotheses were tested using Pearson correlation statistical tool SPSS v23. The result of the findings reveals e-marketing has impacted positively on Sees in Nigeria. It has made sales of goods and services easier than the traditional method of marketing. Therefore, the study recommends that Instagram, and our older customers follow promotions on Facebook, the design and overall message that Ambiance is sending needs to be interesting enough to influence their customers to visit the store. To mention but a few.

CHAPTER ONE

                                        INTRODUCTION

• Background of the study

Academic and managerial interest in E-marketing (EM) has been increasing in recent years. It is heralded by some as the new paradigm of marketing (see, e.g. Brodie, Winklhofer, Coviello, & Johnston, 2007; Eid, 2009; Eid & Trueman, 2004; Hotho & Champion, 2011; Wu, Mahajan, & Balasubramanian, 2003). The recent rush of publications in the area may give rise to the impression that EM can be applied in any context, yet there is little empirical evidence to support this. Meanwhile, as small business enterprises (SBEs) are considered to be the economic engine leading worldwide economic development, they have attracted substantial consideration from researchers, academics and practitioners in the last three decades. A great deal of this interest derives from the belief that innovation, especially in information technology (IT), is crucially dependent on the potential of entrepreneurial SBEs. However, the recent revolution in computer science, the Internet, IT, media and communications has changed the nature of business and marketing practices. A growing numbers of companies and enterprises use the Internet and other electronic tools to communicate with suppliers, business customers and end users of their products and services. New forms of marketing have presented an opportunity for small businesses to grow in a dramatic and dynamic way.  There have been many studies and reports published in UK and overseas in the last few years on the Internet usage in business in general. This study is not another examination of the general usage of Internet in business, rather it builds and summarizes the extensive and valuable research already completed in these areas and extracts the essential themes and messages being expressed by most SMEs. The study aims to examine the perceived opportunities and benefits that Internet usage can offer to SMEs. Barnes et al., (2008) asserted that SMEs make significant contribution to most economies of the World, they are socially and economically important, since they represent 99 % of all enterprises in the EU and provide around 65 million jobs and contribute to entrepreneurship and innovation. SMEs have been shown to contribute significantly to country and regional economic growth, increased employment levels and locally relevant product and service. SMEs are very important to the UK economy; they accounted for 99% of all enterprises and provide over 59% of private sector employment (BERR, 2008). They are also the source of future growth and innovation. Barnes et al., (2008) argue that the advent of the digital economy has made the adoption and use of Internet a significant issue for most SMEs. Yet, many SMEs find themselves in a difficult situation. They may be too small to be able to employ a dedicated IT expert and lack the resources to buy consultancy advice. They often have limited experience in selecting, implementing and evaluating suggested IT solutions (Barnes et al., 2008).  Barnes et al., (2008) noted that SMEs find themselves caught in a trap, lack of resources means that while there may be an aggregate demand for IT service and advice, individually, the varying nature of that demand makes it uneconomical for other firms to provide a service meeting that demand.

According to Bili and Raymond (2003), Small and Medium Business Enterprises (SMEs) are considered to represent the driving forces of sustainable local economic development throughout the world. They form the base of economies, stimulate private property and entrepreneurial capabilities which, due to their flexibility, can quickly adjust to market changes, generate employment, create diversified economic activity, and contribute to exports and trade.

Consequent upon this background, this research aims at examining the impact of e-marketing on the performance of SMEs in Nigeria with particular reference to Selected SMEs in Nigeria.

• STATEMENT OF THE PROBLEM

E-marketing has changed and is still changing the way business is conducted around the world. The commercialization of the Internet has driven e-marketing to become one of the most promising channels for inter-organizational business processes. E-marketing evolved in various means of relationship within the business processes.

In Nigeria, many small and medium enterprises are investing more and more in the Internet/e-marketing business. In order to survive in today’s challenging environment, it is imperative that SMEs be competitive and resilient. So, the main problem of this study is to determine the effect of e-marketing applications on the business success in the small and medium enterprises.

Suffice to say that online advertising or marketing in the major sites in Nigeria occupy prominent position, the effectiveness of online advertising comes from whether consumers are willing to click and watch, but the reality is that most net consumers ignore online advertising. How to attract the attention of consumers has become a very important issue. In practice, different forms of advertising can be designed to attract consumers, such as pop-up ads, button ads, advertising couplet, floating ads, full-page advertising, and so on. Especially for SMEs, due to restrictions on marketing resources, news, advertising, large-scale promotional activities, they have less chance of publicity, so website promotion via the Internet means is much more important for them than big ones. Thus, this study investigates relationship between e-marketing and small and medium sized businesses performance in Nigeria.

• OBJECTIVE OF THE STUDY

The objectives of this study are:

1. To determine if e-marketing applications has a significant and positive impact on business performance in small and medium enterprises
2. To investigate the nature of the relationship between e-marketing and small and medium sized businesses’ productivity.
3. To examine if e-marketing order and delivery has a significant and positive impact on business performance in small and medium enterprises.
4. To determine whether e-marketing customer support service has a significant and positive impact on business performance in small and medium enterprises.
5. To investigate if e-marketing has a significant and positive impact on business performance in small and medium enterprises.
6. To find out whether online payment system has a significant and positive impact on business performance in small and medium enterprises.

1.4 RESEARCH QUESTIONS

The following research hypotheses were formulated by the researcher to aid the completion of the study;

1. Is there any impact on business performance in small and medium enterprises?
2. Does e-marketing has a significant and positive impact on business performance in small and medium enterprises?

• Does online payment system has a significant and positive impact on business performance in small and medium enterprises?

1. Does e-marketing order and delivery has a significant and positive impact on business performance in small and medium enterprises?
2. Does nature of the relationship between e-marketing and small and medium sized businesses’ productivity?
   • RESEARCH HYPOTHESES

Hypotheses One

Ho: Online payment system has a negative impact on business patronage

Hi: Online payment system has a positive impact on business patronage

Hypotheses Two

Ho: Online advertising has an impact on business performance

Hi: Online advertising has a positive impact on business performance

SIGNIFICANCE OF THE STUDY

The findings of this study will be beneficial to organizations as well as firms especially on the need to focus generally on online/internet marketing, individual, group/team and organizational creativity. Also, the findings of this study will serve as a medium of awareness and enlightenment on the many environmental trends affecting organizations in recent years and proffer possible panacea to such problems as they rear heads. Not only this, but also, its findings will serve as platform mostly for professional manager, chief executives and all personnel involved in the staff training, administration and management on how to drive their staff for maximum human creativity and innovation. By so doing, several organizations would be better equipped to develop a repertoire of techniques (management control systems) to improving performances of average employees and at the same time improving the efficiency in management by enforcing cooperation of workers and standardization of work methods especially in creative organizations.

In conclusion, the outcome of this study will provide a contribution to the management of national culture as regards cultural individualism, collectivism, uncertainty avoidance, multiple cultural dimensions as may affect an individual employee’s preferences for, and reaction to management control systems in interactive ways; and it will be a systematic knowledge base for researchers.

1.6 SCOPE AND LIMITATION OF THE STUDY

This study is primary concerned with the impact of e-marketing on the performance of small and medium scale enterprises in Nigeria. This study covers Selected SMEs in Nigeria. The researcher encountered some constraints, which limited the scope of the study. These constraints include but are not limited to the following

1. a) AVAILABILITY OF RESEARCH MATERIAL: The research material available to the researcher is insufficient, thereby limiting the study
2. b) TIME: The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.

1.7 DEFINITION OF TERMS

Medium-sized Enterprises: These are defined as enterprises which employ fewer than 250 persons, and whose annual turnover does not exceed N50 million or whose annual balance-sheet total does not exceed N43 million.

Small Enterprises : These are defined as enterprises which employ fewer than 50 persons and whose annual turnover and/or annual balance sheet total does not exceed N10 million.

Micro Enterprises : These are defined as enterprises which employ fewer than 10 persons and whose annual turnover and/or annual balance sheet total does not exceed N2 million.

Online Marketing: This refers to all forms of internet advertising, internet payment system, internet marketing, internet customer support service and internet order and delivery.

 1.8 ORGANIZATION OF THE STUDY

This research work is organized in five chapters, for easy understanding, as follows

Chapter one is concerned with the introduction, which consist of the (overview, of the study), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study. Chapter two highlights the theoretical framework on which the study is based, thus the review of related literature. Chapter three deals on the research design and methodology adopted in the study. Chapter four concentrate on the data collection and analysis and presentation of finding.  Chapter five gives summary, conclusion, and recommendations made of the study

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