EXHIBITION AND TRADE FAIRS AS TOOL FOR IMPROVED SALES PERFORMANCE IN THE FOOD PROCESSING INDUSTRY –A STUDY OF DANGOTE FLOUR MILL PLC, LAGOS
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CHAPTER TWO
LITERATURE REVIEW
Preamble
This chapter presented literature review on exhibition and trade fairs and Improved Sales Performance. Both theoretical and empirical literature will be reviewed. Theoretical review helped in getting an in-depth understanding of the current body of knowledge on the research topic. Empirical literature helped in understanding studies that have been done on the same area by other researchers and the recommendations therein.
History of trade shows and exhibitions
It was believed that exhibitions or trade fairs began almost 600 years before the birth of Christ. While no precise record was available, the book of Ezekiel (in the Bible) written in 588 BC, contained many references to merchants trading in a “multitude of the kinds of riches with silver, iron, tin and leads. Today, Trade shows and exhibitions provided a forum for companies to display and demonstrate their products to potential buyers who had a special interest in buying those products. The compacted time frame and concentrated location of trade shows were cost-effective for exhibiting companies and convenient for buyers. Trade shows and exhibitions were expensively used as prominent part of marketing strategy. The primary role of trade shows in the marketing strategy was that of a selling medium.
Exhibitions provided a natural and nearly perfect plat form for the delivery of solutions to the buyers. There were two different types of trade shows. There were the business-to-business trade shows- whose exhibitions were in the areas of health care, computer products electronics, advertising specialties, heavy equipment, agriculture, fashions, furniture and toys-focus on goods and services within an industry or a specialized part of an industry. They were targeted at wholesalers and retailers with the intent of pushing products through the channel of distribution. There was the consumer trade shows which also had an industry focus.
They targeted the general public and were designed to stimulate end-user demand. The kinds of products exhibited at that open show included autos, housewares, antiques and crafts. Trade shows ranked second to advertising in the business marketing communications budget for many companies. That was why trade shows had emerged as an important component of business companies’ marketing strategies. Trade shows, also known as trade fairs, expositions, scientific/technical conferences, conventions or exhibits, were basically the gathering of an entire industry at a single location at a given point in time. Companies paid for a booth to expose their products and services at the trade show.
Herbig et al. (1998) reports that whilst companies took on average five sales calls to close a sale if the prospect was found by the salesperson, it took only 0.8 sales calls on average to close a sale if the prospect was found at a trade show. A few other advantages of trade shows for exhibitors included among others, the introduction of new products to a large number of people, the enhancement of goodwill, uncovering of potential customers, promotion of existing products, reinforcement of existing customer relationships, gathering competitors information, general market research, and the improvement of corporate morale. Trade shows is obviously regarded as an important tool of marketing communications, yet relatively few studies had examined the effectiveness of the medium (Hansen 1999). This might be due to the difficulties of isolating the various factors involved in a successful promotion, the great variety of types of exhibitions or the well-established attitudes on the part of exhibitors and non-exhibitors (Blythe, 1999).
Definitions and Concepts
Marketing mix and trade fair’s role in it seems evident from the marketing literature that trade fairs are indeed a very important marketing medium and part of the firms’ overall marketing communication strategy. A marketing communications medium can be defined as anything that is capable of carrying or transmitting a marketing communications message to one or more people (Pickton and Broderick, 2005).
Already in 1974 Banting and Blenkhorn stated that trade fairs have had a long-established role as part of the promotion mix of companies in all sizes. Marketing communication is one part of a firm’s marketing mix, and it can be divided into five categories; 1) advertising, 2) sales promotion, 3) public relations, 4) personal selling, and 5) direct marketing (Kotler 1999). Gopalakrishna et al. (1995) argue that trade fairs are mixes of direct selling and advertising. Whereas Pickton and Broderick (2005) argue that exhibitions have been considered to lie between sales promotion and personal selling, but to make the participation successful all areas of the marketing mix should be utilized (Häyrinen and Vallo, 2012) argues that more and more they can be categorized as personal selling, and at best they are affecting people’s deepest emotions.
Stevens (2005) argues that trade fairs are more than just another marketing communication medium. According to her trade fairs uniquely combine sales with marketing taking advantage of the power of each. When looking at other marketing communication tools such as advertising and sales calls, trade fairs have a unique characteristic of allowing direct contact between different parties and bringing the customer to the company rather than vice versa (Munuera and Ruiz 1999). Thus, for companies this represents a platform of highly potential customers and novel opportunities that are not available in any other way (Gopalakrishna and Williams. 1992). Particularly in the early phases of the buying process, trade fairs may play a cost-effective role in the communications mix but the effectiveness decreases in the evaluation and selection phase, and increases again in providing feedback on product/service performance after the sale (Gopalakrishna and Lilien, 1995).
Smith et al. (2004) find out that personal selling activity is improved and more efficient if trade fairs are part of the communication mix. This also resulted in robust profits. The companies are interested in maximizing the opportunity and they have acknowledged the power of trade shows for shortening the sales cycle (Tanner and Chonko, 1995).
If the trade fair participation is not part of the firm’s overall marketing communication strategy and marketing is not involved with the exhibition, there is a fear that the message at the trade fair does not mirror the company’s objectives and additionally the message could even be in conflict with the message the company is trying to communicate through other media. Therefore for the sake of uniformity in the messages, it is vital that the goals set for trade fairs reflect the company’s overall marketing goals and that marketing experts are involved (Tanner Jr. and Chonko 1995).
Quite often firms fail in the combining of these different parts of the marketing communication palette, and usually they have many external partners for executing these parts. In a comprehensive marketing communication of a firm, they should identify all the situations where a customer might confront the firm, its products and brands and try to signal a consistently positive message in all contact situations (Kotler 1999).
Theoretical Framework
2.3 Theoretical Framework
Theories of Consumer Decision Applied to Sales Performance
It is very difficult to identify the causes of consumer purchase decision. People buy things for many reasons. They seldom are aware of all their feelings and thought processes concerning purchases, and many external forces, such as economic and social conditions, constrain their behavior. Scholars in marketing and the behavioral sciences have attempted to search for simplified, yet fundamental, aspects of consumption in order to better understand and predict at least a portion of behavior in the marketplace. Three outstanding models underlie most of the theories that scholars have advanced: the economic model, the stimulus response model, and the stimulus-organism-response model (Bagozzi 1986).
- Economic Model Applied to Sales Performance
- Stimulus-Response Model Applied to Sales Performance
- Stimulus-Response-Organism Model Applied to Sales Performance
- Economic Model Applied to Sales Performance
Economists were the first to propose a formal theory of consumer behavior (Bagozzi 1986). Their model has led to the so-called vision of economic man, which basically builds on the following premises:
- Consumers are rational in their behavior.
- They attempt to maximize their satisfaction in exchanges using their limited resources.
iii. They have complete information on alternatives to them in exchanges.
- These exchanges are relatively free from external influences.
Actually, not every approach in economics is based on all four premises. Especially the second premise is the basis for the neoclassical economic theory of consumer behavior today. The theory assumes that the consumption of goods and services is motivated by the utility that these goods and services provide. Moreover, it assumes that the choices of the consumer will be constrained by his or her resources.
The economic model hypothesizes that quantity bought (an observable phenomenon) will be a function of income, prices, and tastes (which, with the possible exception of tastes, are also observable). The mechanism or theory behind the prediction lies in the implied decision process. It is assumed that the consumer attempts to maximize his or her utility, subject to budget constraints. Utility is believed to be unobservable.
As a consequence, economists have concentrated primarily on the relationship of easily measured variables, such as income and prices, on quantity bought and have not systematically explored the decision criteria consumers might use to make choices.
Although there has been a lot of empirical research applying the economic model. Most of these studies focused on commodities or on product categories (instead of branded products), and on price and income elasticity.
Overall, the economic model has several attractive features. First of all, it has proven to be an important descriptive tool. The economic model provides answers that are mathematically rigorous, yet simple and intuitive.
Furthermore, it has aided in the forecast of the quantity bought. On the other hand, the economic model suffers from a number of drawbacks.
First of all, it is oversimplified. It fails to consider many real psychological, social, and cultural determinants of this quantity bought.
Second, the model provides only limited guidance for managers. For example, marketers know that, in addition to income and prices, advertising, promotion, product characteristics, and distribution policies influence consumption, but the economic model provides little guidance in this regard.
Third, the economic model takes the utility function as given, ignoring the mental decision processes underlying it. Preferences are another facet of the economic model toward which economists have been ambivalent. Some economists (Marshall, 1938) have incorporated them in their work, but most economists have ignored them.
- Stimulus-Response Model Applied to Sales Performance
Marketing managers have found the economic model particularly lacking in its ability to suggest specific actions for influencing consumption or for anticipating specific demands of consumers (unless resulting from price actions).
A firm or organization has quite an extensive marketing mix repertoire. For instance, a firm can vary prices, discounts allowances, wholesale and retail locations, and a whole host of other tactics. Individual marketing mix variables can lead to more than one response on the part of the consumer with varying degrees of success (Shira, 2003).
Most firms need guidelines that will indicate how their actions actually influence trial and repeat purchases by consumers. Consumers’ actions or their reactions to marketing mix stimuli include increased awareness of, interest in, and desire for a product, in addition to actual purchase of the product.
Many forces not under the direct control of firms also influence consumer purchase decision. These are labeled environmental factors and include economic conditions, social determinants, and cultural influences. Marketers have little or no control over these, but they do try to anticipate and forecast their effects. George (1998) was one of the first researchers that focused the attention on psychological and sociological factors, in order to explain the large variability in expenditures on durable goods. This development was a reaction to the economic model, which George (1998) claimed missed a number of important details.
By use of a stimulus-response approach, marketers can discover the reactions of consumers to different advertising appeals, package designs, and prices, to name a few stimuli. The stimulus-response model is an appealing model. First of all, it is simple, which makes it easy to understand and communicate to others. Second, it is a highly useful managerial tool and it has been found to work well in the past.
On the other hand, the stimulus-response model falls short on one very important and far-reaching criterion: it omits the processes through which stimuli induce responses. Marketers need to know how their actions bring about responses so that they can more effectively and efficiently design and target their stimuli.
Another limitation is that it fails to allow for the possibility that some purchase behaviors are self-generated and (almost) uninfluenced by external stimuli. The stimulus-response model, by definition, ignores the origin and determination of buying intentions. People are represented as being buffeted by stimuli rather than freely discovering their needs and choosing among alternatives.
- Stimulus-Response-Organism Model Applied to Sales Performance
In reality, consumer decision-making processes are quite complex and are influenced by many forces both within and around the individual. Fortunately, it is possible to identify a relatively small number of elements common to most everyday consumption decisions. The general model of consumer behavior is an abstraction designed to symbolically represent most of the major elements and processes in all consumer choice decisions.
Promotion objectives of trade shows and exhibitions
Maitland (1997) advised that it was of paramount importance for a firm to be aware of its goals. He pointed out that an organization should only attend an exhibition if it fitted in with its overall plan and assisted in obtaining set business objectives.
Patten (2001) enumerated some of the marketing objectives that organizations could use to exhibit in shows as; selling more products, launching a new line, finding distributors or outlets in a new territory and finding agents. Others were attracting new market, re-positioning ones company in the market, giving support to field agents, collecting feedback on a projected new range of products, re-establishing links with clients whom the organization did not see often and public relations to strengthen the organization’s position in the market place.
Factors that influence the choice of trade shows and exhibitions as a method of promotion
The company’s choice for the appropriate medium for promotion was very important since the promotional tool was highly dependent on the marketing budget. The firm needed to maximize exposure to the target audience to ensure return to investment. Therefore, the choice of medium used is influenced by a number of factors:-
Promotional objectives: The choice of trade shows as a promotional tool was often influenced by the company’s promotional objectives. Yeshin (2006) noted that there were a variety of reasons why companies participated in trade shows. Major objectives being building awareness, introducing new products, reaching customers cost effectively, generating additional sales, gaining information about competitors among others. Exhibitions being a direct face-to-face medium provide a good platform to collect feedback on a projected new product for one could see lots of prospects in a short time, Patten (2001).
Nature of the product: The nature of the product either, consumer or industrial played a crucial role in determining participation in trade shows. Maitland (1997) explains that large industrial products could be displayed under controlled conditions. They may also be demonstrated, touched, tested, examined and operated by exhibition attendees.
Target market: Reaching the target market effectively was crucial to the marketer. The promotional medium used was therefore highly dependent on how well it was able to reach the target market. Exhibitions were flexible marketing medium in that they represented the market in one place and time. They brought together suppliers, buyers, and the media among others. Exhibitions may be effective if the audience was specialized and targeted effectively.
Competitors’ behavior: Marketers were constantly looking for ways to find creative ways to separate their promotions from those offered by their competitors.
The Concept of Trade Show
Domestic and global competitions lead companies to gain and maintain competitive advantages both in their domestic markets and global markets. They need to conduct SWOT analysis and have the opportunities to expand abroad. Exporting is a short, low cost, low risk-taking and low commitment making requiring method for global expansion. Companies can use several approaches to finding customers, make export agreements with them, and initiate export activities. Participating in an international trade show is relatively cheap, fast, and focused activity which offers opportunities to discover foreign markets, learn about their customers, and trigger exporting.
According to Tobb (2007), a trade show is an activity which has a specific name, type, scope, organizer, date, duration, location to support benefits of a society and a certain industry. It leads companies to exhibit their products and services, demonstrate and transfer technological improvements, knowledge and innovation; develop and improve network and trade relationships with visitors to form strategic alliances, expand market share, and exchange information (Aycı, 2011). Black (1986) explains that a trade show is a tool for suppliers in a certain industry to show their products and services (Chiou et al., 2007). Kotler (2000) defined a trade show as a mean of promoting sales (Chu and Chiu, 2013).
Alkibay and Songür (2002) believe that a trade show is a substantial tool to enhance export potentials of countries. Companies can globalize and compete in international markets by attending trade shows. Arzt (2006) adds that companies which attend trade shows can internationalize faster and stand lower costs than companies which do not attend (Aycı, 2011).
Bello and Barksdale (1986) state that trade show participation leads companies exporting and gaining global business view cost efficiently (Chiou et al., 2007). Shi and Smith (2012) believe that international trade shows are cost-efficient and quick way to increase exports and gather valuable market information to enter international markets.
Company level international trade show participation literature reveals that the incremental effect on exports is codified by managerial factors and international trade show participation in developed countries. According to UFI Statistics (2011), 12,500 trade shows were conducted between 2006–2008 in the world. Although, the number of exhibitions decreased by 16% in 2009, the half of this decrease was recouped in 2010. Reid (1980) believes that participating trade show included in export promotion programs is the most effective way to learn other countries trade laws and facilities.
Pfeiffer, Burgemeister, Hibbert, and Spence (1998) highlighted that trade shows‟ impact on exports and their use as an export promotion tool was examined in terms of company level effectiveness. Lee and Yang (1990) reveal that there is a positive relationship between the number of export markets and sales volume of exports. Wilkinson and Brouthers (2000) showed that there was a positive relationship between international trade show participation and exports in US. Theey (2000) found a positive correlation between times of trade show participation in the same country and aggregate state export (Li and Shrestha, 2013).
Kalafsky and Gress (2013) tried to figure out how machine tool producers in Korea utilize a global trade show in Seoul to minimize difficulties of global customers. Their trade show activity geared towards innovation. They found out that the amount of importance placed on trade show attendance as part of a company’s internationalization strategies was related to growth of exports. They added that companies that participate in trade shows as part of their innovation process had higher rates of export intensity. According to Seringhaus and Rosson (1994) participation in global trade shows, is a barometer of a company’s degree of investment in international activities and a major part of its internationalization strategies. Dicken (2011) added that exporting was the first step of the company’s internationalization activities (Kalafsky and Gress, 2013).
Several researches have been conducted related to trade shows in the field of business administration to investigate their importance as sales and marketing instruments to develop images, establish brands, and attract customers (BatheltandSchuldt, 2010).
Empirical Review
Kotler and Keller (2012) stated that the determination of target market (market targeting) is an activity that is carried out after we can perform segmentation of all different market potential, then the company must decide what kind of and how many segments that will be targeted. Target market (target market) consists of a number of buyers who share my needs and characteristics that will be served by the company. The process of selection of the segment we are going to offer our products and services are known by the term targeting. The company can choose a covering market as follows: full market coverage, multiple segment specialization, single segment concentration, and ethical choice of market targets.
Cravens (2012) the positioning strategy is the combination of marketing program (mix) strategies used to portray the positioning desired by management to the targeted buyers. The decision of the election of the target market is a central point of the strategy of marketing itself and became the basis in determining the purpose and development strategy positioning. Because of it, positioning strategy is the main factor in increasing the power company market position in a particular market than their competitors. So positioning is a business of infusing an impression (image) specifically in mind of consumers to products even against the company target.
Kotler and Amstrong (2012) positioning is the act of designing the company’s offer so that it occupies a distinct and valued place in the target customer mind. In order that target consumers understand and appreciate what behavior by the association in relation to its rival. After making stages of the process target (targeting) and identifying target market then companies need to position products or its service (positioning) through to customers.
Adeolu et al, (2005) seek to examine the influence of advertising on consumers’ purchase of Nigeria Bottling Company, one of the products manufactured by Nigeria Bottling Company; find out that advertising has a major influence on consumers’ preference for Nigeria Bottling Company and it has, in no small measure, contributed to its success. In the same view, Adekoya, (2011) reveals that advertising has helped to position product or service strongly in the mind of the consumer in order to encourage repeated purchase of the product, so that the competitors will not have an edge over them. This also creates brand loyalty and product differentiation.
Akanbi and Adeyeye (2011) carried out a research work on the influence of advertising on sales and linear regression using ordinary least square method to analyze the data. The result confirmed that a positive and significant relationship existed between advertising and sales. The positive relationship showed that an increase in advertising can lead to an increase in sales.
Ferdinand (2000) stated that the performance of the marketing of a factor which is often used to measure the impact of the company marketing strategies applied. Marketing strategies always directed to produce the performance marketing (as sales volume and the level of sales growth).
Narver (1995) described the outcomes of the application of marketing strategies as kepusan consumers, the success of new products, sales increase, and profitability.
Sajuyigbe (2012) examine the impact of packaging on organizational sales turnover. Structured questionnaire was employed to collect data with the aid of face to face interview from eighty participants through purposive sampling method. Inferential statistics was used to analyze the data, specifically, ordinary least squares multiple regression method was employed. Result showed that packaging has significant effect on sales turnover. Result also found that packaging and other factors such as brand name, pricing and promotion jointly predict organizational sales turnover, which accounted for 98% variance of sales turnover. The study concluded that a specific package must be developed for each product because variations in packaging can make a product sale-able in various target markets.
Choi (2007) find that better protective packaging is especially important to manufacturers and wholesalers, who may have to absorb the cost of goods damaged in transit. Sometimes the cost of such damage can be charged to the transportation agencies. Moreover, goods damaged in shipment may delay production or cause lost sales.
Frankling (2004) also agrees that packaging is vital to retailers, they benefit from both the protective and promotional aspects of packaging. Packaging which provides better protection, supermarket operators claim, can reduce store costs by lessening breakage, shrinkage and spoiled, preventing discoloration and stopping pilferage (Chaneta, 2012). Packages that are easier to handle can cut costs by speeding price marking, improving handling and display, and saving space. Chaneta (2012) says that packaging can increase sales by such promotional-oriented moves as offering smaller or larger sizes more multi-pack, better pictures of the product itself, illustrations of the product in use and more effective use of color.
Trade Fairs and Exhibition in Competitive Market
Trade fairs and exhibitions are important marketing instruments and as such provide a significant impetus for international trading of goods and services. They help to create a more competitive market and to raise growth and employment levels. Globalization and an increasing focus on brands will lead to these globally important industry marketplaces occupying an even more significant role in the future, and as a result trade fair organisers are increasingly becoming all-round marketing partners of the industry.
Marketers have always given considerable importance to this process and Kotler and Keller (2007) have added that some of these tasks, as the creation of knowledge to customers, can be met through non personal marketing communication channels. As the consumer approaches the buying process, there is a need for more personalized communication. However, the majority of marketing managers use a mix of personal and non-personal communication techniques, in order to best achieve the marketing communication objectives. Importantly, Dekimpe et al. (1997) identifies trade shows as a perfect combination of direct sales (represented by sales agents at standing at the company’s booth) and advertising (branded booths with company’s logo and key message, or other information available where often it is impossible for the seller to interfere).
Promotion Intensity and Buyers Behaviors
A consumer is the ultimate user of a product or service. The overall consumer market consists of all buyers of goods and services for personal or family use, more than 270 million people (including children) spending trillions of dollars in the United States as of the late 1990s.
Consumer behavior essentially refers to how and why people make the purchase decisions they do. Marketers strive to understand this behavior so they can better formulate appropriate marketing stimuli that will result in increased sales and brand loyalty. There are a vast number of goods available for purchase, but consumers tend to attribute this volume to the industrial world’s massive production capacity. Rather, the giant known as the marketing profession is responsible for the variety of goods on the market. The science of evaluating and influencing consumer behavior is foremost in determining which marketing efforts will be used and when.
To understand consumer behavior, experts examine purchase decision processes, especially any particular triggers that compel consumers to buy a certain product. Marketers spend a great deal of time and money discovering what compels consumers to make such on-the-spot purchases. Market researchers obtain some of the best information through in-store research, and will often launch new products only in select small venues where they expect a reasonable test of the product’s success can be executed. In this manner, they can determine whether a product’s success is likely before investing excessive company resources to introduce that product nationally or even internationally.
Types of Consumer Buying Behavior
Mainly there are four major types of consumer buying behavior which are based on the intensity of involvement in buying and the alternative options of the product (brand). These are as follows.
- Complex Buying Behavior
- Dissonance-Reducing Buying Behavior
- Habitual Buying Behavior
- Variety-Seeking Buying Behavior
Each of these are discussed one by one.
- Complex Buying Behavior:
Complex buying behavior is exhibited by the consumers, when the involvement level in a purchasing is high and also there are different brands available in the market that represent different values. In such cases the product searched for buying is relatively expensive and risky. The product also covers the aspect of self expression and the frequency of purchase is also occasionally. This means that the customer searching for such types of products wants to understand about the category of product completely. He makes efforts in this regard to obtain the highly beneficial product that can best meet his requirements.
For example, if a consumer wants to purchase a personal computer, then he cannot get the clear idea of computer through his RAM, Processor etc. Instead, he first tries to make his beliefs about the categories of different brands of computers. After which he develops his attitudes and finally purchase a certain personal computer on the basis of his learning process. The companies should understand the behavior of consumers in the gathering of information and its evaluation. The marketers of the companies need to explain the attributes and the importance of the different offered brands to such consumers. They should reflect the features and benefits of each brand to motivate the consumer for making a purchase of high involvement.
- Dissonance Reducing Buying Behavior
Dissonance Reducing Buying Behavior represents such case in which the involvement of the consumers is high, but the available brands show less differences. The purchase of the product is relatively quicker in this kind. For example, in case of purchasing of a carpet by a consumer, he first learns all the available brands with their relative specifications like price etc. As carpet is also self expressive and expensive product, but its alternative brands have little difference among them. So, the consumer tries to check every brand quickly and make a purchase mostly on the basis of given price or the ease of purchase.
- Habitual Buying Behavior
Habitual Buying Behavior is one of the types of Consumer Buying Behavior in which the involvement of consumers in the purchase is low along with the few differences among the alternative brands. In this case the products offered are cheap and purchased frequently. For example, if a consumer purchases sugar from the market, he exhibits habitual behavior in such a way that he does not inquires different brands and prices of sugar. Instead, he buys it simply from the first shop without making any extra efforts.
In habitual buying the consumers are not involved in the learning process of understanding the features of brands, nor they develop attitudes to make a purchase. Instead, they are involved in passive learning in which they get brand familiarity through different sources like magazines, advertising, television etc. When consumers are familiar with any brand, they just buy it without exhibiting post purchase evaluation because they are not fully involved in the purchase.
The companies offering low involvement product with few brand differences should use the factor of price and sales promotion to increase its sales of products. The company should use the symbols and images to create the brand awareness, because these things can easily be remembered. Moreover the television is preferred for advertising in which short duration ads are shown repeatedly so that the consumers can easily remember the brand. Another trick in this regard is that the companies should link its low involvement products to certain relative issues. Just like any toothpaste manufacturing company can link its toothpaste to prevent cavities. This linking would make a low involvement product into high involvement, which in turns increases the sales of the company.
- Variety-Seeking Buying Behavior
The fourth type of Consumer Buying Behavior is variety-seeking buying behavior in which the involvement of consumer is low, but the brands exhibit much perceived difference. In such situations, consumers are switched more from one product to another. For example a consumer wants to buy a cookie, so he does not try to learn different brand and specifications of cookies, rather, he simply buys a certain brand of cookie and make use of it to make an evaluation, and the next time he may buy another brand of cookie. This switching of consumer from one brand to another is not based on the dissatisfaction, but on the base of testing the variety.
The companies should adopt different marketing strategies based on the market share. The market leaders should promote the habitual buying by keeping the larger shelf space, increased stocks on the shelves and showing repeating advertising messages. While the firms holding a little market share, should adopt different marketing strategies, which encourages variety seeking behavior by reducing prices of products, coupons, free samples, special deals along with the advertising that provide reasons to test something new.
Relationship Quality in the Trade Fair Context
In the trade fair segment, the ‘product’ and ‘service’ provided by the trade fair company to their business customers – exhibitors and visitors – is an ‘experience’ in the ‘information exchange’ platform of the trade fair. The delivery of this ‘experience product’ is through multichannel. The success of a trade fair depends on the close co-ordination of organizers, exhibitors and potential visitors (Kresse 2005). A trade fair and its sphere encompass a relationship triad among a trade fair company, exhibitors and visitors (Bruhn and Hadwich, 2005). The fact that exhibitors and visitors, as ‘buyers’ of the ‘trade fair product’ that the trade fair company ‘sells’, are themselves the main components of the ‘product’ construct a complicated buying-selling relationship between exhibitors and the trade fair company, and between visitors and the trade fair company. The duty of organizers is to facilitate the relationship-building between the two customers at different stages of the events: pre-event, on-site and post event. In addition, although organizers are sales representatives of the trade fair event, they are not the exclusive supplier of the product. Other suppliers include venues and related local sectors. This phenomenon is unique in the trade fair industry. Exhibitors generally expect optimized quality and quantity of visitors, ideal trade fair facilities, minimal organizational effort before and during the trade show, including booth space and technical services, registration, appointment systems, one-stop shopping/billing, etc. (Stoeck and Weiss, 2005).
If expectations are poorly met, the relationships between trade fair companies and exhibitors are harmed. The trade fair product that a trade fair company delivers to its customers is of a primarily intangible character, relying on customer participation and depending largely upon minimizing the expectation-perception gap from the customers’ perspectives. With the core product being ‘interaction between exhibitors and visitors”, it is difficult to assess the quality of this product. Bruhn and Hadwich (2005) indicate that the trade fair product is, by its very nature, of ‘credence qualities’ (Zeithaml 1991) which presents “a situation in which the attributes of services cannot be assessed even after purchase and consumption”. From the perspective of exhibitors, it is difficult to develop and apply quantified methods to assess if potential customers are generated from a particular trade fair, even though techniques and skills on follow-ups after trade fair proliferate. It depends on trust in the trade fair organizer that the future events may live up to their expectations. Thus, future attending decisions are based on credence in the organizers, not simply the one-off on-site experience. Trade fair is of typical relational exchange nature. It is crucial for a trade fair company to build strong relationship with their business customers to sustain subsequent trade fairs.
Conclusion
The study review indicates that trade fairs and exhibitions are important marketing instruments and as such provide a significant impetus for international trading of goods and services. They help to create a more competitive market and to raise growth and employment levels. Exhibitions provide a natural and nearly perfect platform for the delivery of solutions to the buyers. Trade fairs are especially unique compared to other marketing tools when talking about live communication and touching all the senses.
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