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THE EFFECTIVENESS OF ONLINE ADVERTISEMENT

ON CONSUMER DECISION. A CASE OF RADIO AFRICA


GROUP LIMITED NAIROBI, KENYA

BY

NJUGUNA NGURE ALVIN

UNITED STATES INTERNATIONAL UNIVERSITY-


AFRICA

SUMMER 2017
THE EFFECTIVENESS OF ONLINE ADVERTISEMENT
ON CONSUMER DECISION: A CASE OF RADIO AFRICA
GROUP LIMITED NAIROBI, KENYA

BY

NJUGUNA NGURE ALVIN

A Research Project Submitted to the Chandaria School of


Business in Partial Fulfillment of the Requirement for the
Degree of Masters in Business Administration (MBA)

UNITED STATES INTERNATIONAL UNIVERSITY-


AFRICA

SUMMER 2017
STUDENT’S DECLARATION

I, the undersigned, declare that this is my original work and has not been submitted to any
other college, institution, or university other than the United States International
University Africa in Nairobi for academic credit.

Signed: ________________________ Date:______________________

Njuguna Ngure Alvin

This project has been presented for examination with my approval as the appointed
supervisor

Signed: ________________________ Date:______________________

Dr. Peter Kiriri

Signed: ________________________ Date:______________________

Dean, Chandaria School of Business

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ABSTRACT
The general objective of the study was to establish the effectiveness of online
advertisement on consumer decision. The study was guided by the following objectives;
To establish the effect of online advertisement tools on consumer decision, to determine
effects of strategies used on online advertising and to establish barriers affecting online
advertisement on consumer decision.

A descriptive research design was used to describe variables. In addition, it is also used to
determine frequency with which something occurs or relationship between variables.
Further, correlation was done to identify relationship between dependent and independent
variables. The target population for this study was 80 employees at radio Africa from
where a sample of 67 respondents was established and only 60 responded. Questionnaires
were self-administered and were dropped and picked immediately respondents were done
filling them. Descriptive and inferential statistics was used to analyze data. Data collected
was then presented using tables and figures. Statistical Package for Social Sciences
(SPSS) software was used to analyze data.

The findings revealed that most respondents agreed that online advertising creates interest
and brand awareness, and its activities have helped increase product and service
awareness. The findings also show that utilization of online advert provide feedback
which enhances product awareness. Most respondents also agreed that internet
advertising is more efficient compared to other media channels and it was also more
effective compared to other media channels. Analysis of the data also revealed that online
advertisement create value for products by making them memorable and easily
recognizable and social media marketing has had a significant impact towards building
the name of the company and its products.

It was revealed that email marketing increases attitudinal brand loyalty through growing
of the purchasing behavior, and using Email marketing has enabled easy reach to a huge
number of subscribers on a daily basis. Most responded noted that humor and sexuality
are the main advertising factors used to attract consumers to viral ads. It was also noted
that viral ads encourage individuals to pass on information that they receive to friends and
family. Consumers that closely identify with Radio Africa act as agents and spread
positive word of mouth and display ads, have a positive effect on brand awareness and
advertising recall. There was uncertainty that Radio Africa has used online banners to

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create awareness and attract customer’s attention. Respondents also agreed that E-mail
marketing campaigns increased returns on investment (ROI).

The findings established that customer attitude influences their mental position for certain
matter and there was uncertainty that cconsumers attitude can be influence by the quality
of online advertising. Also, according to the findings, the respondents agreed that nature
of information of the online advert influence consumer decisions to purchase and use and
knowledge of social media affect customer attitudes toward marketing and the age
determines attitudes that customers exhibit towards advertising. The findings also
revealed that education levels influence consumer use of online advertising and increased
internet penetration influences online advertising.

The study concluded that online advertising is important to a firm like Radio Africa that
relies on communication to create interest and brand awareness. In addition, marketing
strategies applied determine increases in brand loyalty and therefore influence purchasing
behavior of the services and products offered. It was also noted that customer have an
attitude and the type of attitude exhibited influences their mental position for certain
matter. Some of this peculiar attitudes are determined by the quality of online
advertisement used and the nature of information on the online advert.

The study recommended that Radio Africa need to ensure that the online tools adopted
creates the most interest and brand awareness among its consumers. Radio Africa group
also needs to analyze and there after determining what strategies gives the highest value
to the consumers. The firm needs to establish ways of ensuring they maintain a positive
customer attitude and this could be done by ensuring a high quality of online advertising.
There is also a need to ensure that the nature of information of the online advert positively
influence consumer decisions to purchase.

There is a need to do further studies at Radio Africa to establish if online advertisement


has created a positive attitude towards the company’s product hence increased firm’s
performance (sales revenues, market share, profitability). Similar studies can also be done
on other institution in order to generalize the findings.

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DEDICATION
I would like to dedicate this project to my family for their support throughout this
journey.

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ACKNOWLEDGEMENT
I wish to acknowledge my research supervisor Dr. Peter Kiriri for his guidance and
encouragement throughout the entire process.

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TABLE OF CONTENT

STUDENT’S DECLARATION ........................................................................................ii


ABSTRACT .......................................................................................................................iii
DEDICATION.................................................................................................................... v
ACKNOWLEDGEMENT ................................................................................................ vi
LIST OF TABLES ............................................................................................................ ix
LIST OF FIGURES ........................................................................................................... x
ABBREVIATION AND ACRONYMS ........................................................................... xi

CHAPTER ONE ................................................................................................................ 1


1.0 INTRODUCTION...................................................................................................... 1
1.1 Background of the Study ............................................................................................... 1
1.2 Problem Statement ......................................................................................................... 4
1.3 General Objective .......................................................................................................... 5
1.4 Specific Objectives ........................................................................................................ 5
1.5 Significance of the Study ............................................................................................... 5
1.6 Scope of the Study ......................................................................................................... 6
1.7 Definition of Terms........................................................................................................ 6
1.8 Chapter summary ........................................................................................................... 7

CHAPTER TWO ............................................................................................................... 8


2.0 LITERATURE REVIEW ........................................................................................... 8
2.1 Introduction .................................................................................................................... 8
2.2 Effect of Online Advertisement tools on Consumer Decision....................................... 8
2.3 Effects of Strategies Used on Online Advertising ....................................................... 13
2.4 Barriers Affecting Online Advertising on Consumer Decision ................................... 17
2.5 Chapter Summary ........................................................................................................ 22

CHAPTER THREE ......................................................................................................... 23


3.0 RESEARCH METHODOLOGY ............................................................................. 23
3.1 Introduction .................................................................................................................. 23
3.2 Research Design........................................................................................................... 23
3.4 Data Collection Methods ............................................................................................. 25

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3.5 Research Procedure ...................................................................................................... 26
3.6 Data Analysis Methods ................................................................................................ 26
3.7 Chapter Summary ........................................................................................................ 26

CHAPTER FOUR ............................................................................................................ 28


4.0 RESULTS AND FINDINGS ..................................................................................... 28
4.1 Introduction .................................................................................................................. 28
4.2 Demography................................................................................................................. 28
4.3 Effect Of Online Advertisement Tools On Consumer Decision ................................. 30
4.4. Effects Of Strategies Used On Online Advertising .................................................... 32
4.5 Barriers Affecting Online Advertisement On Consumer Decision ............................. 34
4.6 Customer Decision ....................................................................................................... 35
4.7 Inferential Analysis ...................................................................................................... 36
4.8 Chapter Summary ........................................................................................................ 37

CHAPTER FIVE ............................................................................................................. 38


5.0 DISCUSSION, CONCLUSION AND RECOMMENDATION ............................. 38
5.1 Introduction .................................................................................................................. 38
5.2 Summary ...................................................................................................................... 38
5.3 Discussion .................................................................................................................... 40
5.4 Conclusion ................................................................................................................... 45
5.5 Recommendation ......................................................................................................... 45

REFERENCES ................................................................................................................. 47
APPENDIX 1 : QUESTIONNAIRE.............................................................................. 61

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LIST OF TABLES
Table 4.1: Response Rate ................................................................................................... 28

Table 4.2: Online Advertisement Tools on Consumer Decision ....................................... 31

Table 4.3: Brand Equity and Consumer Decision ............................................................. 31

Table 4.4: Brand Loyalty and Consumer Decision ............................................................ 32

Table 4.5: Effects of Strategies Used on Online Advertising ............................................ 32

Table 4.6: Effects of Viral Advertising on Online Advertising ......................................... 33

Table 4.7: Effects of Display Ads on Online Advertising ................................................. 33

Table 4.8: Consumer Attitude Affect Online Advertisement ............................................ 34

Table 4.9: Perceived Privacy Risk ..................................................................................... 34

Table 4.10: Effect of Social Economic Factors on Online Advertisement ........................ 35

Table 4.11: Descriptive on Customer Decision ................................................................. 36

Table 4.12: Reliability Test................................................................................................ 36

Table 4.13: Correlation Analysis ....................................................................................... 37

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LIST OF FIGURES
Figure 4.1: Gender of Respondents ................................................................................ 28

Figure 4.2: Age of Respondents ...................................................................................... 29

Figure 4.3: Education of Respondents ........................................................................... 29

Figure 4.4: Management Level ....................................................................................... 30

Figure 4.5: Years worked ................................................................................................ 30

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ABBREVIATION AND ACRONYMS

ROI : Return on Investment

SD : Standard Deviation

SPSS : Statistical Package For Social Sciences

WOM : Word of Mouth

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CHAPTER ONE

1.0 INTRODUCTION

1.1 Background of the Study


Advertisement is a marketing strategy tool that is used by companies to influence
consumer’s perception and buying decision towards their brand (Tan & Rashad, 2014).
Gunelius (2011) asserts that a lot of companies are spending a lot of their marketing
budget on social media campaigns. Godoy (2012) states that in some companies’ their
social media marketing objectives are sometimes unclear and 41% of businesses
participate in social media marketing in an effort to increase their sales.

Golden (2011) argues that social media marketing uses pull techniques to attract
customers. This is where customers are pulled in due to availability of good content hence
allows customers to engage. On the other hand traditional marketing pushes the
company‘s product and services at potential customers through paid advertising or
brochures (Skul, 2007). Maymann (2008) the traditional marketing is based in 4’P
(Product, Place, Promotion, Price) whereas social media marketing changes 4Ps to 19 P
of social media marketing (Ekinci, 2010). Jackson (2011) a study done by Info-graphics
states that half of Facebook and twitter users are able to recommend or purchase a
company products after engaging with the company on social media. In addition
companies can also promote their products and services, provide instant support, and
create brand image.

A survey by Nielsen (2013) showed that the majority of advertisers are increasing their
advertising budget for social media and that they have a separate budget for marketing
through it. Most of the marketers surveyed indicated that they are planning to shift
a part of their advertising budget from traditional media to social media. Moreover,
the study showed that 89% of the marketers are adopting the free social media
tools and 75% of them are adopting the paid advertisements together with the free
tools on social media

In Kenya, companies and advertisers have used traditional media as the main source of
advertisement. However due to advance in technology a lot of companies and advertisers
have been forced to change their marketing strategy and start using digital media to
advertise, connect with customers, and create new markets and influence consumer

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purchase decision. In addition, consumers have been given the opportunity to access
product and service information (Osewe, 2013). Hanafizadeh and Behboudi (2012)
Internet advertising is an Internet-based process which enables companies communicate,
interact and persuade customer’s decision. Companies are able to position their brands in
the minds of consumers hence promote consumer awareness and preference and reduce
time needed to make a buying decision

Online advertising is the process of advertising using technological developments in


communication. It us the use of internet to convey advertising messages (Durmaz, 2011).
Online advertising is advertising of products and services through use of the internet
(Interactive Advertising Bureau, 2012). According to Priyanka (2012), internet
advertising does not only refer to advertising on the internet but on wireless media and
email. Internet advertising is widely supported by websites and blogs since it offers
an alternative revenue model. Examples of online advertising include affiliate
marketing, display advertising, search engine marketing, email advertising, and social
media advertising (Priyanka, 2012). According to Shuma (2016), in Kenya the growth of
internet use has led to businesses using online marketing as a promotional strategy hence
being able to communicate with their customers and promote their brand

According to a study done by the Consumer Insight (2013) revealed that Kenya is
experiencing the growth of internet amongst Youth. In addition, it was also revealed that
in Kenya youths in urban areas spend around Sh2.2 billion annually to purchase data for
accessing Facebook and Twitter on their mobile phones. Osewe (2013) in his study on the
effectiveness of internet advertising on consumer behavior study revealed that use of
internet advertising was effective on reach and was able to create awareness because of its
diverse usage opportunities. In addition, the researcher also revealed that there was a
positive relationship between internet adverting and consumer purchase decision.
Nashombe (2015) in his study on African cultures in advertisement in Kenya study
revealed mobile phone companies are not able to cater for the different characteristics
between Kenya market and markets in other countries because their marketing advisors
base their internet advertising strategy on external sources.

According to a study done by Mbiti (2015), on influence of internet advertising on


purchase of mobile phones among University of Nairobi Students study revealed that
internet advertising influences purchase of mobile phones to a low extent however, it was

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revealed that internet advertising played a major role with regards to reach and
information. Nyamamu (2014) in her study on the influence of digital advertising on
performance of print media companies in Kenya study revealed that findings, internet was
the main digital platform adopted by print media houses as the digital advertising
platform. The study also revealed that in Kenya digital advertising has grown. This is
because firms are starting to invest on various digital advertising platforms to reach and
communicate with their customers

Jenyo and Soyoye (2015) in their study on online marketing and consumer purchase
behavior: A study of Nigerian firm’s findings showed that online marketing has an impact
on consumer purchase decision in Nigeria companies. In addition, findings also revealed
that there is a significant positive relationship between consumer purchase decisions and
infrastructure of the internet in Nigeria. El-Gharbawy (2015) in his study on the impact of
social advertising campaigns in shaping Egyptian youth’s behavioral intentions study
revealed that in Egypt fast food companies have adopted that use of face book to market
their products. Fast food chains use their fan pages to connect with their customers and
market their meals and offers. Companies also send posts to remind customer of new
products, new promotions and many other forms of content

According to Ernst and Young (2013), social media advertising in India is used more. The
study revealed that 95.7% of companies surveyed use social media to build communities
and promote usage, 76.1% of companies use social media to position their brand in the
minds of the consumer whereas 83% of organizations surveyed used social media ads,
with majority of the ads being used to promote a contest/promotion or for brand
awareness. 88.6% said they find social media ads to be beneficial in achieving their
objectives.

Spiegel Online (2011) due to the rapid growth of online advertisement, in Germany
online advertisement is used more than newspaper advertising. In addition, study revealed
that the gross advertising spending on online advertisement grew from 19.2% in 2009 to
39.1% in 2010. According to internet Advertising Revenue Report (IAB) (2014), the
study revealed that in the United States, revenue from internet advertisement has
increased from $36.47 billion in 2012 to $42.78 in 2013.According to Yannopoulos
(2011), in USA internet advertisement is quicker than traditional advertisement hence
leading to an increase use of online advertisement and companies spending more on e-

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marketing than on traditional marketing. Yulihasri et al. (2011)in their study on factors
affecting consumer buying behavior intention on shopping online it was revealed that web
advertisement has a positive influence on consumers purchase decision

According to a study done by Yet-Mee, et al (2011) on the effectiveness of online


advertising in purchase decision it was suggested that in Malaysia companies should
include online advertising in their advertising media mix. In addition, online marketers
and retailers should place more attention on the design usefulness and integrity of the
online ads to promote a positive attitude toward online ads among the consumers.
Developed countries prefer e-marketing because they usually do a research before buying
their products (Sen & Argha, 2014).

Samreen and Maria (2017) in their study on impact of E-marketing on consumer


behavior states that in Pakistan, social media advertising affects customers buying
perception, use of e-marketing affects customers’ decision more that use of traditional
advertising and use of social media marketing enables companies attract their target
customers.

Radio Africa Group is a top Radio, TV and Newspaper Media House in the region. It
operates the top radio stations in Kenya, including Kiss FM and Classic 105. When
Kiss100 launched in the late 90s, it shifted radio marketing and content paradigms in
Kenya, and is known for its notoriously provocative and risqué tone in its communication
that always raises eyebrows.

1.2 Problem Statement


The Internet has emerged as an advertising medium (Silk et al., 2001). Social media
marketing is the process of promoting one’s site or business through social media
channels(Schweidel & Moe, 2014).In addition, the use of social media enables companies
to promote their products, build relationship with customers and understand customer’s
needs (Halligan, Shah, & Scott, 2010)

Ambrose and Catherine (2013) conducted a study on social media and entrepreneurship
growth it was revealed that social media tools play different roles to different SMEs
and that the tools could be incorporated into different operational roles in the
businesses. Wanjoga (2002) did a study on consumer attitudes towards online advertising
in Nairobi, findings revealed that consumers were aware of the online adverts and do not

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have any preferences to the types of internet advertising. Wakukha (2011) did a study on
the use of internet advertising by Kenya mobile telephone the study discussed forms of
internet adverting used and success and challenges companies face but the study did not
provide any information on effectiveness of internet advertising in influencing consumer
response. Kithinji (2015) did a study on advertising on the social media: an analysis of the
youth’s responses to Facebook advertising in the Nairobi. Barasa (2014) conducted a
study on social media as an effective advertising tool in Kenya.

Tehreem and Rizwan (2016) conducted a study on effects of online advertisement on


consumer buying behavior of university students of Pakistan. Ngenga (2015) did a study
on the extent of the use of social media marketing on business growth. Rosemaryet al
(2012) conducted a study on evidence on the usage of internet marketing in the hospitality
sector in an emerging economy and its relationship to profitability. Kithinji (2014)
conducted a study on internet marketing and performance of small and medium
enterprises in Nairobi County. A lot of studies have been done on online advertising but
less have been done on online advertising and it influence on consumer decision.
Therefore this study sought to address this knowledge gap by focusing on to establish the
effectiveness of online advertisement on consumer decision.

1.3 General Objective


The general objective of the study was to establish the effectiveness of online
advertisement on consumer decision

1.4 Specific Objectives


The study is guided by the following objectives;

1.4.1. To establish the effect of online advertisement tools on consumer decision

1.4.2. To determine effects of strategies used on online advertising

1.4.3. To establish barriers affecting online advertisement on consumer decision

1.5 Significance of the Study


1.5.1 Government

Government plays a crucial role in determining the content that the public gains access to
in the internet, therefore the findings from this study will encourage government

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organizations to come up with policies that will encourage the use of social media
marketing.

1.5.2 Researchers

This research will, act as reference to future academic studies hence provide more
information on online marketing and customers decision. The study will also add more
knowledge to existing information.

1.5.3 Organizations
Organizations will benefit from findings from this study because they will be able to
come up with online strategies they can use to develop online advertising companies to
attract new and existing customers.

1.6 Scope of the Study


The study was carried out at Radio Africa Group Limited and the population will be
drawn from 141 employees. It included employees from production department, supply
chain, finance, warehouse, quality assurance, administration and human resource,
maintenance and sales. The limitation of the study was the short period available for the
study and unresponsive respondents. The study was carried out from June until August
2017.

1.7 Definition of Terms

1.7.1 Online Marketing


Online marketing is the process for reaching out to many existing and potential
customers as possible using the internet (Thersthol & Lövgren, 2007)

1.7.2 Social Media marketing


Social media marketing is “any form of direct or indirect marketing that is used to build
awareness, recognition, recall, and action for a brand, business, product or person using
the tools of the social Web” (Gunelius, 2011:10)

1.7.3 Social media


Social Media is “Online resources that people use to share content such as video, photos,
images, text, ideas, insight, opinions” (Drury, 2008:274)

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1.7.4 Online Advertising

Online advertisement is a promotional tool that uses Internet and World Wide Web to
deliver marketing messages to attract customers (Tutaj, 2012).

1.8 Chapter summary

This chapter has discussed the background of the study in line with the general objective
of the study which was to establish the effectiveness of online advertisement on consumer
decision. The specific objectives of the research were to establish the effect of online
advertisement tools on consumer decision, to determine effects of strategies used on
online advertising and to establish barriers affecting online advertisement on consumer
decision.

Chapter two will discuss literature review while chapter three will highlight research
methodology applied for the study. In chapter four the results and findings of this study is
presented in form of tables and graphs while in chapter five the discussions conclusion
and recommendations are presented.

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CHAPTER TWO
2.0 LITERATURE REVIEW

2.1 Introduction
This chapter presents empirical literature on impacts of online advertisement tools,
strategies used on online advertising and barriers affecting online advertisement. This
chapter presents empirical literature on effectiveness of online advertisement on
consumer decision. Literature review was guided by the following research objectives; To
establish the effect of online advertisement tools on consumer decision, to establish
barriers affecting online advertisement on consumer decision and to determine effects of
strategies used on online advertising

2.2 Effect of Online Advertisement tools on Consumer Decision


This new marketing communication reality presents new challenges and opportunities for
companies as purchase decisions are increasingly influenced by online interactions
Priyanka (2012). According to the same author, people rely now more than ever on their
online social networks when making purchasing decisions. Since an increasing part of
this network is situated within the social media space and a large part of the
communication within the network is happening in this space, Gilaninia, Taleghani, and
Karimi (2013) add that online platforms exhibit an important role in consumer decision-
making. Since brands cannot take the risk of being absent in such an influential
communication channel, despite the risks and doubts, companies are investing
increasingly into their online advertising activities (Divol et al., 2012). Ha (2017) defines
online advertising as deliberate messages placed on third- party web sites including
search engines and directories available through Internet access. The author adds that
online advertising can be categorized into a variety of functions including creating
awareness, attractiveness and visual image and slogans.

2.2.1 Awareness
Creating awareness is the primary role of advertising such as communicating to target
consumers on products, services, experiences, ideas, and so forth, offered by the
companies (Manickam, 2014). Online advertisements outperform the print advertisements
because the web’s vividness and interactivity characteristics cater for differences in how
advertisements are processed in the two media (Belanche, Flavián, & Pérez-Rueda,

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2017). Compared to print, the authors add that online advertising offers more stimuli and
could thus potentially effectively create brand awareness and keep the user’s attention and
interest longer. Advertising is the primary revenue stream for many of the ‘‘free’’
services provided to Internet users (Castro, 2012) and is essential to the continued
economic sustainability of many services, such as email, news and search engines. The
immense value for both the end-user and the commercial entity providing these services
is demonstrated by organizations such as Google, which in 2013 derived over 90% of its
$55.5 billion revenue from advertising (Google, 2014)

According to Jacques, Perry and Kristensson (2015), online advertising networks may
offer advice to advertisers on how to best present their products or services. For instance,
in order to help publishers maximize their return from the online program Google offers
suggestions to publishers to customize the colors and fonts of adverts to match the
website’s ‘look and feel.’ In addition to colors and fonts, the location of an advert is also
considered an important factor in user recognition. Fox, Smith, Chaparro, and Shaikh
(2009) suggest that adverts should be located high on the page and use a contrasting color
scheme. By maximizing visibility, adverts are expected to build brand recognition and itis
suggested that this increased recognition will result in increased click rates.

Simply making an advert more visible may not increase advertising-derived revenue
according to Goldfarb and Tucker (2011). The authors insist that users react negatively to
more obtrusive targeted advertising including video, pop-ups, and overlays as users fear
exposure of private information. Pawar (2014), in his research on the effectiveness of
online marketing in India noted that companies should use online activities in their
marketing efforts to increase product as service awareness since online activities
facilitate good access and higher reach to the customers. Therefore, companies must
take this advantage by incorporating online advertising in their marketing strategy. Online
video directories for brands are a good example of interactive advertising. These
directories complement television advertising and allow the viewer to view the
commercials of several brands.

A useful function of online advertising is the user’s ability to provide feedback which
enhances product awareness (Osewe, 2013). According to the author, if the advertiser
has opted for a response feature, the viewer may then choose to visit the brand’s
website, or interact with the advertiser through other online channels such as email or

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chat features to obtain more information about the product or to purchase. Consumers
may also enhance product awareness by gathering information about products and
services and communicating that information with other consumers and firms for related
products and service through social media sites (Gilaninia, et al., 2013). In their study on
the effect of social media marketing on creating awareness in Italy, Nadeem, Andreini,
Salo, and Laukkanen, (2015) concluded that online peer recommendations have a
significantly stronger influence on attitudes of females than they do on attitudes of males.

Miller and Lammas, (2010) noted that social media has advanced from simply providing
a platform for individuals to stay in touch with their family and friends to an online
platform where consumers can learn more about their favorite companies and the
products they sell. The authors added that due to the increased access to internet services
through smart phones, companies are able to use social media sites such as Facebook,
Twitter or LinkedIn and mobile phone applications to create product and brand
awareness. Rastogi and Khan, (2015) agree that advertising on the Internet has the dual
benefit of being generally more efficient and effective compared to other media channels.
According to the authors, the effectiveness of creating brand and product awareness
through online advertising, for instance can be measured using a variety of tracking
methods through which advertiser can tell, for example, who clicked on their online
advert and therefore determine how many consumers are aware of their product or
service.

2.2.2 Brand Equity


Technological improvements have facilitated the move from mass marketing to
relationship marketing and enabled the creation of direct ties with consumers. Along with
the increasing popularity of online review websites, online customer reviews have
emerged as a source of influence in the purchase decision process. Brand equity refers to
a value premium that a company generates from a product with a recognizable name,
when compared to a generic equivalent. Companies can create brand equity for their
products by making them memorable, easily recognizable, and superior in quality and
reliability.

Kotler and Keller (2009), Brand equity is the value given to the products and services that
can be reflected in how consumers think feel and act in conjunction with the brand, and
also in conjunction to price, market share, and profitability. Jordan. Rana (2011) in her

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study on the impact of social-media use on brand equity of magazine brands a qualitative
study of Vogue Turkey findings indicated that social media marketing has significant
impact towards building brand equity. Furthermore, online communities, interaction, and
sharing of content were also found to have significant impact on brand equity. The
findings also show that the use of social media impacts brand equity in four major ways;
social media opens a new direct communication channel, it increases organization brands
presence, facilitates customers involvement and finally social media helps organization a
build relationship with their customers. Brand equity can influence marketing
communication efficacy through influencing consumers to favor the brand when exposed
to adverts and other communications. Additionally, the ability to remember the
communication increases (Rashid, 2014)

According to a study done by Miseda (2012) on the effect of social media in brand
communication findings revealed that social media has significant positive influence on
brand equity of organizations studied. Owino, et al (2016) in their study on the influence
of social media on brand equity in Kenyan banking industry findings revealed that social
media has a significant positive influence on brand equity in the banking industry.
Mwangi (2014) in his study on the influence of social media marketing on brand equity at
Safaricom Limited findings revealed that social media marketing has a positive influence
on Brand equity (brand awareness, brand perception, brand loyalty). Tresna and Wijaya
(2015) social media has a positive effect on brand awareness, brand association, brand
loyalty and perceived quality. Abu-Rumman and Alhadid (2014) findings revealed
that social media marketing has a positive influence on brand equity.

2.2.3 Brand Loyalty


Building and maintaining brand loyalty are one of the central themes of research for
marketers for a very long time (Chatterjee & Patrali, 2008). The authors add that as
brands gain exclusive, positive, and prominent meaning in the minds of a large
number of consumers, they become irresistible and irreplaceable, and win the loyalty
of the consumers. Anderson and Srinivasan (2003) defined brand loyalty as the
preferential, attitudinal, and behavioral response toward one or more brands in a product
category expressed over a period of time by a consumer. The authors further defined e-
loyalty as the customer’s favorable attitude toward an electronic business resulting in

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repeat buying behavior or as the contentment of the customer with respect to his or her
prior purchasing experience with a given electronic commerce firm.

Brand loyalty, according to Laroche, Habibi and Richard (2013) brings sales revenues,
market share, profitability to the firms, and help companies grow or at least maintain
themselves in the marketplace. Osewe, (2013) noted that marketers have utilized various
means to maintain the brand loyalty of their customers one of them being online
marketing. Zheng, Cheung, Lee, and Liang (2015) in their study in building brand loyalty
through internet channels such as social media showed that brand loyalty of the customers
is positively affected when the brand offers advantageous campaigns, offers relevant
content, offers popular contents, appears on various platforms and offers applications on
social media.

Erdoğmuş & Cicek (2012) state that consumer brand loyalty is also affected by the
different platforms and applications that are offered by the brand on the internet,
what might imply that consumers are asking for creative reasons, variety, and
differences for engaging with the brands on social media. Pawar, (2014) agrees that
companies should work on creating more engaging, interesting applications, games and
content to increase brand loyalty. However, Hadija et al (2012) warns that firms should
refrain from sharing sad events, horror or advertisements among each other. This,
according to the author, means that social media is a platform where people want
to entertain themselves, as well as share information and instructions among each other.
Kuo and Feng (2013) insist that Brands and campaigns around brands should be
entertaining while information and instructional manuals about the brands may also be
provided on social media since information sharing is also an important driver of
engagement and brand loyalty.

Kalia and Mishra (2016) on the other hand insist that relevancy is an important factor
affecting online brand loyalty; therefore, companies have to keep themselves updated
about what customers are interested in, their activities, and current perspectives in life.
Companies may conduct qualitative research or observations to understand the
lifestyle of their customers and transfer this knowledge on social media platforms
(Jacques & Kristensson,2015). Manickam, (2014) noted from his study that the
popularity of the content among online friends on social media also increases brand
loyalty of the consumers. According to the author, the impact of social circles in

12
marketing is non-negligible, especially in online environments, therefore, companies can
provide incentives to the social media users to spread the word about their
presence, campaigns, and content on social media among the peers. They can also spot
opinion leaders in their target markets and hire them on purpose to talk about their
campaigns and pull people to engage with their brands on social media.

Andrews and Currim (2000) find that the brand loyalty coefficient in a multinomial logit
model is lower for online versus offline grocery shopping, but online shoppers select from
a smaller consideration set of brands, thereby remaining loyal to a smaller number of
brands. Both these studies are limited in that they do not fully account for the
demographic differences between online and offline shoppers such as education level and
age, which may well be causing the difference in brand loyalty between the two
environments.

According to a research done by eMarketer consumers visit social media sites to keep up
with a brand's products and promotional campaigns for example companies use social
media sites to offer online customer loyalty programs to engage customers by offering
special promotions, free stuff (Leggat, 2010). Bushelow (2012) in his research on
Facebook Pages and benefits to brands findings revealed that interaction with fan pages
does not strongly influence consumer brand loyalty or purchase intentions. Irem (2012) in
his research on impact of social media marketing on brand loyalty findings revealed that
social media campaigns have a positive influence on brand loyalty

2.3 Effects of Strategies Used on Online Advertising

2.3.1 Viral advertising


Viral marketing is also known as word of mouth or buss marketing. It is the creation of a
process where interested people market to each other (Miller& Lammas, 2010). Word of
mouth (WOM) marketing is such a successful marketing strategy because it breeds
“familiarity, personal connection, care and trust” between the consumer and the translator
of the information (Datta, et al., 2005, p. 70). Online word of mouth (WOM) is defined
as "any positive or negative statement made by potential, actual, or former customers
about a product or company, which is made available to a multitude of people and
institutions via the Internet" (Henning-Thurau, 2004). Viral marketing is “a technique

13
which use internet to transmit and spread messages among individuals who will forward
the messages to their friends and family (Woerndl et al, 2008)

Kiss and Bichler (2008) viral marketing is a marketing techniques that use social
networks to produce increased brand awareness through self-replicating viral diffusion of
messages, analogous to the spread of pathological and computer viruses. Golan and
Zaidner (2008) in their study on viral advertising in large company’s findings revealed
that humor and sexuality are the main advertising factors used to attract consumers to
viral ads, and if consumers are entertained by the ads, they are more likely to share or
pass on the ads to their friends and family. Victoria (2008). Viral marketing is used to
pass adverts, animations, photos, hyperlinked promotions, newsletters, games, press
releases, or petitions. This type of marketing encourages individuals to pass on
information that they receive to friends and family. Viral marketing also create a buzz
around a product or service. In addition, customers are more likely to trust
recommendations made by friends or family about on a product or service, rather than
from a company.

Berger (2014) WOM advertising is perceived as a trust trustworthy source of information


that reduces risk, simplifies complexity, and increases the confidence of consumers in
decision-making. Owino (2014), consumers that closely identify with an organization will
act as agents of that organization and will spread positive word of mouth about the
company and its products, in the process therefore recruiting customer. According to
a study done by Ho et.al (2015) on effects of brand image, online word of mouth and
price discount on consumers purchases, word of mouth can be classified into positive and
weak and positive and strong. Findings revealed that word of mouth has an influence on
customers purchase intention

According to a study done Eda (2013) on the effect of viral marketing on y generation’s
purchasing behavior findings revealed that WOM advertising influences customers
purchase behavior. Yang and Zhou (2011) suggests that consumers are more likely to
pass along a message if they are motivated to do so. Subramani & Rajagopalan (2003)
argue that consumers have different psychological effect created by different types of
viral marketing campaign initiatives. These effects can also be observed from individual’s
intention to share information that contributes to the benefits of viral marketing campaign
(Smith et al 2007).

14
2.3.2 Display Advertising
Display advertising it the use of web banners or banner ads placed on a third-party
website to drive traffic to a company's own website and increase product awareness.
Dreze and Hussherr (2003) although customers avoid looking at display ads, they still
have a positive effect on brand awareness and advertising recall. Danaher and Mullarkey
(2003) in his research on findings revealed that w that banner ads have more influence on
individuals who are browsing. Priyanka (2012) display advertising is a type of advertising
that involves placement of banners by advertisers on third party website to drive
traffic to their product or service pages.

According to Chatterjee (2008) customers usually avoid banner, pop up advertisement


and text advertisement because they are perceived to be annoying. Gitanjali and Ashutosh
(2016) in their research on effects of online advertising on consumer it was revealed that
banners and pop up ads are annoying and intrusive. Consumers notice banner ads because
of their relevancy and location on the page and should include bright colors, interactivity,
graphics, videos, logos, sizes and discounts. Online banner advertisements are text and
graphical displays that are hyperlinked to the uniform resource locator (URL) of the
advertiser. Companies use online banner advertising to create awareness and attract
customer’s attention (Salem, 2016).

2.3.3 Email Marketing


E-mail marketing is any type of electronic message sent to a database, which presents a
promotional offer in order to stimulate customers to click on the ad and be redirected to
the company’s landing page (Personal Communication, 2014). According to Hampsey
(2013) in his study on the influence of email marketing messages it was revealed that
66% of customers have made a purchase as a result of an e-mail marketing campaign.

E-mail marketing campaigns have been linked to the associated increase in returns on
investment (ROI) than other forms of online marketing (Pavlov, 2008). However, there
are yet a few studies undertaken on the effectiveness and profitability of e-mail marketing
campaigns (Cho, 2006). Using E marketing enables companies to track the exact ROI and
this therefore permits them to measure the performance of the campaign. Also, this type
of online marketing allows firms to customize and personalize the message sent and is
significantly cheaper and faster than conventional mail which requires more time to
produce and print thus making it more expensive. Monetate (2014) adds that by using the

15
service advertisers can easily reach a huge number of subscribers on a daily basis as
previous research has noted that 91% of consumers do check their e-mail on a regular
basis.

However, email deliverability remains a trouble for valid entrepreneurs as electronic mail
marketing is frequently coupled with junk mail sent to recipient’s mailbox without their
permission and this type of email might be either welcomed or barred by some customers
who may perceive them as an unethical manner of email advertising (Raad, 2010). On the
contrary, some agencies are not taking the gain of these campaigns, mainly due to the fact
50% of the marketers that acknowledge that their database is not up to date and therefore
acts as a barrier to the effectiveness of the campaigns (Adestra, 2013). Many
organizations use e-mail advertising campaigns as a way to growing their income. but,
these campaigns would possibly have specific objectives like deliverance of the relevant
content material, power additional traffic to the internet site, combine e-mail with
different advertising techniques, construct brand attention, increase the dimensions of the
databases and create leads (Burstein, 2013). Nevertheless, the important thing to create a
successful email advertising and marketing campaign is to supply value to clients, so that
it builds and maintains a better relationship with clients.

To try this, businesses should take some aspect which incorporates the introduction of a
good impression the first time. Customers could be more temped to open e-mails from
entities they apprehend. But, if the consumer does no longer understand the sender, he or
she can look to the challenge the subject of the mail. So this needs to be appealing to be
able to seize purchaser’s interest. It’s been proven that over 40% of clients are probable to
open e-mails that consult with merchandise they recently viewed on the sites, or objects
they prefer. In the meantime, 33% of purchasers determine whether or not to open an
electronic mail or not with the aid of what is written at the subject line (Monetate, 2014).
The primary influence is probably the difference among customers reading e-mails or
auto deleting them. The primary aim of email sender and subject line has to be to
motivate the customer to without a doubt open the e-mail (Thomas, 2011). If firms cannot
make their clients open the e-mail, issues pertaining message format and content might be
considered useless (Willey, 2013).

Merisavo and Raulas (2004) concluded that consumers establish special sales offers, facts
on new merchandise and contests useful matters in e mail commercial. The aim of the

16
store visit in 40.4% of the cases varied, in different cases the purchasers wanted to have a
first-hand experience, or gain extra information or get private recommendation (Martin,
Van Durme et al. 2003). This suggests that email marketing increases attitudinal and
behavioral brand loyalty through growing of the purchasing behavior.

Micheaux (2011) observed that consumers can perceive stress by way of receiving email
advertising and marketing. Whilst a marketing e mail is anticipated to be useful and,
when studied, it seems that the real usefulness is likewise excessive, the perceived strain
will decrease. However whilst an e mail is expected to be useful and its miles determined
that the real usefulness is low, the perceived pressure will growth (Micheaux 2011). With
this it affects the attitudinal loyalty through the attitude toward a brand.

Besides generating a terrible mind-set a lack of usefulness also can cause un-subscription
(Micheaux 2011). While e-mails are not examined or acquired, they do not create
satisfaction, consequently undoing the fantastic effect satisfaction has on brand loyalty
over a long run (Oliver 1999). Merisavo and Raulas (2004) decided that the three
elements that decide usefulness in email advertising, these factors align with the elements
of commercial values (Li et al. 2002). These include advertising values, information
quality, and economic rewards, discovered to be critical elements dependent on how
intrusive an email is taken to be (Li et al. 2002). An empirical research by Chang et al.
(2013) discovered evidence that when an e-mail, is perceived as intrusive purchasers react
negatively to the e-mail. Furthermore the intentions towards the sender are stimulated in a
poor way. In a research on net advertisements similar results had been found. It was noted
that intrusive advertisements lead to inflammation, which results in a poor attitude
towards the web site (in this example brand) finally leading to poor behavioral intentions
(McCoy, Everard et al. 2008).

2.4 Barriers Affecting Online Advertising on Consumer Decision

2.4.1 Consumer’s Attitude


Attitude refers to the way someone thinks or feels about something and also to the
manner, and disposition on the subject (Oxford Dictionaries, 2013). Attitude influences
the mental position that the person will take on a certain matter and the behavior
that follows it. Essentially, one’s state of mind and the behavior that arises because of this
state is what is referred to as their attitude. Attitudes of others is the extent to which

17
another person’s negative attitude towards the preferred alternatives or reluctance to meet
the terms of supporting the purchase intention, this may result in a readjustment of the
consumer’s purchase intention (Kotler and Keller, 2009). Salem (2016) perceived
advertisement credibility influences customer’s attitude towards an advertisement and
purchase intention.

According to Mehta (2000), consumer’s attitude towards online advertising is one of the
influential factors of effectiveness of online advertising as consumer’s cognitive ability
towards the online advertisement are reflected in their thoughts as well as feelings
and subsequently will influence their attitude towards online advertising. Consumers
attitude can be influence by factors of online advertising such as; credibility, in-
formativeness, pleasure and materialism. Credibility is the consumer’s perception towards
the credibility, trustworthiness, believability, and convincibility of an online
advertisement. Goldsmith and Lafferty (2002) in their study on consumer response to
Web site and their influence on advertising effectiveness findings revealed that consumer
who have a positive attitude towards an online advertisement are more likely to recall the
advertisement that those who have a negative attitude. Chu (2011) customer’s attitude
towards the website indicates their attitude towards its content: Customers are more likely
to accept and rely on information they see on a website they appreciate

Belch and Belch (2011) customers form different attitude towards online advertisement
which results to informational response. Informational response is a process where
customers go through when responding to an online advertisement. It comprise of
awareness, interest, desires and action. According to research done by Campbell et al,
(2014) and Kelly et al, (2010) on effects of consumer attitude on online advertising,
findings revealed that consumers often have a certain inclination to avoid advertising.
Taylor et al., (2011) in their study on friends, fans, and followers: do ads work on social
networks findings revealed that 22% of consumers had a positive attitude towards digital
advertising, and 8% had left a certain social network because of what they felt as
excessive publicity. Akar & Topçu (2011) in their research on factors that affect the
attitude of the consumers towards embracing marketing through the social media
findings revealed that use of social media, knowledge of social media, following of social
media, and fears about marketing with social media all have an effect on attitudes
toward marketing with social media

18
Dutta-Bergman (2006) states that demographic and lifestyle determines attitudes that
customers exhibit towards advertising but suggests that younger customers rely less on
advertising for decision making compared to their older counterparts. According to A
study done by Shavitt et al, (2008) study on psychographic variables related to attitudes
towards advertising, findings revealed that younger people were more likely to show
positive attitudes towards advertising and were less likely to feel offended or
insulted by advertising which Mehta (2000) argues translates to better message recall.
The attitude towards social network advertising is very important, as this kind of publicity
is not only beneficial for organizations, it also provides the websites with the revenue that
allows their survival: the problem is that at the same time, users can feel overwhelmed by
it and social network lose their appeal (Hadija et al, 2012).

According to Gilaninia et al., (2013) internet penetration is forcing researchers to take a


deeper look into internet advertising, its impacts on consumer attitudes, and the efficacy
of online ad campaigns. The reason behind this growing interest is that the internet has
reduced advertising. Chu (2011) also found that users who are Facebook group members
maintain a more favorable attitude toward social media and advertising. Users who have
more positive attitudes toward advertising are more likely to join a brand or a retailer’s
Facebook group to receive promotional messages. Wanjoga (2002) studied consumer
attitudes towards online advertising in Nairobi, and showed that consumers were aware of
the online adverts without preferences to the types of internet advertising

2.4.2 Perceived Privacy Risk


Dinev et. al. (2013) perceived risk is ‘a function of the expected outcomes of information
disclosure, together with considerations for context (i.e., information sensitivity).
Perceived privacy risk can be defined as the consumer’s perception of risk when
marketers attempt to collect, use or distribute information about consumers and their
behavior (Myerscough et al., 2006). Consumers are becoming more aware and concerned
of the privacy risks on the internet. Companies are using consumer’s personal information
to personalize advertisements hence enabling customers get advertisements that are
relevant to them (Larisse, 2014). Goldfarb and Tucker (2011) based on their research on
impact of privacy regulations in European Union it was revealed that display advertising
was less effective after the implementation of the Privacy Directive.

19
Consumers are becoming more concerned about is accessing and using their personal
information left behind from their online and unauthorized sharing of their personal
information by marketers with third parties (Myerscough et al., 2006). Customers are
faces with risk of their private information being accessed by unauthorized users because
the information can easily be transferred between social media sites. Additionally, over
sharing of information increases vulnerability of location based information hence threat
to their private life. (Rose, 2011) According to Dinev et al (2013) customers perceived
risk can be influenced by trust, self-efficacy, and structural assurances. Olivero and Lunt
(2004) customers perceived privacy risk can be reduced by providing customers with
control (over their information) and by increasing their level of trust.

Zimmer et al. (2010) in their study on investigating online information disclosure findings
established that information relevance directly influences perceived risk: when a
consumer perceives the information being collected as relevant, their level of perceived
risk is reduced, and therefore they are more willing to give personal information.
Trustworthiness is consumers’ confidence in the source which includes the
characteristics of honesty, objectivity, and good faith (Boyd and Shank, 2004) Trust
and perceived security in social networking sites play an important role in attitudes
towards shopping (Jiyoung 2009). Trust influences online purchaser and enhances
customer’s intention to buy (McCole et al. 2010). Consumers who use social networking
sites are more concerned about risks to privacy. This is because; consumers provide
personal information about themselves. This personal information can be accessed by
unauthorized users (Dwyer et al., 2007; Rosenblum, 2007)

Souter and Kerretts-Makau (2012), consumers must have confidence about the product
information and reliability of the trading partner. In addition, consumers are usually
reluctant to shop online because of perceived risk associated with such transactions.
Jebur, Gheysari and Roghanian (2012) grouped the limitations of e-commerce into
technical (Lack of universally accepted standards for quality, security, and reliability,
communication bandwidth, security, e-commerce software incompatibility with operating
system and other applications) and non-technical (privacy, internet access difficulty and
expense, consumers will to touch the products, loss in the social interaction).

People are now more than ever concerned more with issues surrounding improper use
of personal data, identity theft and other security issues like credit card fraud. In a

20
study on American and European internet users, Earp (2005) established that
"individuals are more anxious about emerging issues such as personalized browsing
experiences, scrutinized purchasing trends and targeted marketing and research" (2010).
In a 2015 survey it was established that as many as 94 percent of Internet users have an
issue of security in regard to their online presence, while 39 percent confess that their
biggest fear is their personal information finding its way to the wrong hands
(Nellevad, 2012).

2.4.3 Social Economic Factors


In the recent years, internet demand led to increased research in academic studies which
aim at investigating variables influencing internet of demand. This is because the internet
has not only expanded in size, and speed, scale worldwide but it is expected to improve.
There are various theoretical models that try to explain the factors that foster adoption of
use ICT. Previous researches in developed countries reveal that socioeconomic factors
have influenced the adoption and use of ICT by households (Hoffman & Novak 1996).
Other issues that influence ICTs adoption by households include household size, social
network, and lifestyle (Le-Guel, 2005). Previous studies by Madden et al. (1996) among
5000 Australian homes revealed that demographic factors such as education, race, and
age played a major role in acquisition of broadband Internet service by individuals.
Concurrently, studies like Hausman et al. (2001) and Rappoport (2002) also indicated that
household income also played a vital factor towards broadband acceptance. Furthermore,
Beilock and Dimitrova (2003) inferred that in the inter-country Internet diffusion was
mainly influenced by the per capita income and non-economic factors like the political
independences.

In a study to analyze factors that promote internet penetration, Chinn and Fairlie (2004)
established that income per capita, illiteracy, years of schooling, youth and aged, rate of
urbanization, dependency ratios, telephone density, consumption of electricity as well as
regulatory quality were vital in determine the rate of internet use. Moreover, by
investigating rate of internet demand in Spain, Cerno and Amaral (2005) established
internet usage rose with increase in income and other technological factors, however, the
usage decreases with low socio-demographic characteristics such as age and as habitat. A
cross-country analysis done by Oyelaran-Oyeyinka and Lal (2005) also confirmed the
significance of telecommunications infrastructure, this was represented by the extremely

21
high link between the telephone connection density and Internet connectivity, and this
was recorded irrespective of per capita income level of the states. In a related study, Genc
et al. (2006) approximated the demand of Internet use in the U.S. by employing a range of
variables like gender, income, race, age, marital status, education level, employment
status, and parenthood. The results however indicated that employment had a negative
relation to Internet use, while, marital status lack considerable effect. Neira et al. (2008);
Cadman and Dineen (2008) study of Internet in 38 African countries concluded that
effects of income on the Internet use was not relevant; however, other variables such as
call cost and monthly subscription cost variables negatively impacted Internet use.

2.5 Chapter Summary

This chapter presents empirical literature on effectiveness of online advertisement on


consumer decision. Literature review was guided by the following research objectives; To
establish the effect of online advertisement tools on consumer decision, to establish
barriers affecting online advertisement on consumer decision and to determine effects of
strategies used on online advertising. On the first objective, the literature in awareness,
brand equity and brand loyalty are discussed, similarly when analyzing the issues of
barriers, the study looks at barriers caused by consumer attitudes, perceived privacy risk
and social economic factors. Finally to analyze the strategies used the research focused on
viral advertising, display advertising, and email marketing. Chapter three will focus on
the research methodology to be applied for the study, and this will include the research
design, population and sample size as well as the data analysis and presentation.

22
CHAPTER THREE

3.0 RESEARCH METHODOLOGY

3.1 Introduction
This chapter discusses research methodology that was used in this research. In addition, it
looks at research design, population, and sample size, data collection methods, research
procedures and data analysis and the presentation methods to be utilized in this research.

3.2 Research Design


Burns and Grove (2003:195) research design is “a blueprint for conducting a study with
maximum control over factors that may interfere with the validity of the findings”.
According to Saunders et al (2016), research design is a framework that is used by
researchers to collect and analyze data. A descriptive research design was used.
According to Cooper and Schindler (2006) a descriptive research is a method that is used
to describe variables. In addition, it is also used to determine frequency with which
something occurs or relationship between variables. Ngechu (2004) descriptive research
is concerned with finding out the what, where and how of a phenomenon. Further,
correlation was done to identify relationship between dependent and independent
variables. Quantitative research was used. Creswell (2003) quantitative research is the
process of collecting, analyzing, interpreting, and writing the results of a study.

3.3 Population and Sampling Design

3.3.1 Population
Cooper and Schindler, (2003) population is the total number or elements or individuals
researcher seeks to make inference on. Saunder et al (2016) population is the full set of
cases from which a sample was obtained. A population is the collection of all individuals
or units that a researcher would like to study (O’Gorman & MacIntosh, 2014). The target
population for this study was 80 employees at radio Africa.

23
Table 3.1: Population

Level Number of employees Percentage (%)


Top management 8 10

Middle Level Management 56 70

Low level Management 16 20

Total 80 100

Source: Radio Africa (2017).

3.3.2 Sampling
3.3.2.1 Sample Frame
According to Mugenda and Mugenda (2008), sample frame is a group or subgroup that is
obtained from the population that a researcher wishes to study. A sampling frame is the
source material or device from which a sample is drawn. It represents a list of all those
within a population who can be sampled, and may include individuals, households or
institution (Zikmund & Babin, 2012). The sample of the study was comprised of all
employees in the various department of the firm.

3.3.2.2 Sampling Technique

Stratified random sampling was used and this was in regard to the management levels in
the firm According to Cooper and Schindler (2014) stratified random sampling is the
process of segmenting target population into strata. Denscombe (2007) the use of
stratified random sampling gives every member of the population an equal chance of
being selected. Mugenda and Mugenda (2008), stratified random sampling is useful for
heterogeneous samples hence giving a true representation of the population. The finding
of the study was assumed a true representative of the study population.

3.3.2.3 Sample Size

According to Mugenda and Mugenda (2003), a sample is a smaller group or sub-group


obtained from that target population. Furthermore, a sample size of 10% of the sample
size is considered adequate for a descriptive study. Kombo and Tromp (2006), in order

24
for a researcher to get accurate results, a sample size should was collected using the
formula n-= N/ (1+Ne2)
Where n= sample size
N= total population
e= error of margin
From the initial population of 80 and at a 95% confidence interval a sample size was
arrived at as follows:
80/ (1+ (80x (0.5)2)
80/1.2= 67

Table 3.2 Sample Distribution


Level Number of employees Percentage (%)
Top management 7 10

Middle Level Management 47 70

Low level Management 13 20

Total 67 100%

3.4 Data Collection Methods


Data collection is the process of collecting data in a systematic way. Structured questions
were used because they help provide more information. Additionally, respondents will
also be able to express their thoughts freely (Saunders et al, 2005). Gilbert, (2001) use of
questionnaires allows a researcher to gather significant amount of data at a cheaper cost.
The data was quantitative in nature and respondents were given structured statements and
using a five-point Likert scale they were required to respond to the statements where they
were to rate based on the rating of five; (1) Strongly Disagree, (2) Disagree, (3) Neutral
(4) Agree and (5) Strongly Agreed.

The questionnaire was subdivided into four sections where the first section looked at the
demography with the second, third and the fourth section offered questions for the
specific objectives.

25
3.5 Research Procedure
Creswell (2003) research procedure is a process of collecting and analyzing data for a
particular purpose. Closed ended questionnaires were used to collect data. Close ended
questionnaires are easy to answer code and compare respondent’s answers. Questionnaire
was designed and pre-tested amongst five members. Pre-test was done to ensure that data
collected are valid and accurate. This was done by randomly issuing 10 questionnaires
randomly to the respondents. Feedback received from the pre-test was incorporated into
the questionnaire before administering the final copy. Researcher used an official letter
from United States International University to be able to collect data.

Questionnaires were self-administered and they were dropped and picked immediately
respondents are done filling them. To ensure a high response rate, the researcher used the
respective departmental heads to administer the questionnaires. Respondents were given
ample time to answer the questionnaire.

According to Mugenda and Mugenda (2003), validity is the degree to which results
obtained from the analysis of the data represent the variables of the study. The research
instrument was validated in terms of content and face validity.

3.6 Data Analysis Methods


Data analysis is the process of cleaning, transforming, analyzing, and modeling data
gathered in a research. Saunders and Thornhill (2009) data analysis is the process of
transforming raw data into tables, charts, with frequency distribution and percentages.
Data collected was sorted and coded to the different variables, Statistical Package for
Social Sciences (SPSS) software was used to analyze data.

Descriptive and inferential research was used to analyze data where under the descriptive
research the frequencies, mean, variances, and standard deviations. For the inferential
statistics however, a Pearson correlation was done to determine how independent
variables influence dependent variable. The findings were presented using tables, figures,
and charts.

3.7 Chapter Summary


This chapter has discussed research methodology that will be used in the study. It has also
highlighted research design, population, sampling frame, sampling technique, sample

26
size, data collection, and data analysis method used. The next chapter will look at the data
analysis methods applied for this study.

27
CHAPTER FOUR
4.0 RESULTS AND FINDINGS

4.1 Introduction
This chapter brings outlines the results as acquired from the data analysis. This include
results relating to the respondents’ demography and the specific research objectives
aimed at establishing effectiveness of online advertisement on consumer decision.

4.1.1 Response Rate


The research issued a total of 67 questionnaires and a total of 60 were filled and returned
giving a response rate of 90%. This was sufficient for the study as indicated in Table 4.1

Table 4.1: Response Rate

Variable Frequency Percentage


Filled and returned 60 90
Non-response 7 10
Total 67 100

4.2 General Information


This section presents the demographical data this includes findings in regard to gender,
age education, management level, year worked.

4.2.1 Gender of Respondents


The data presented show that female respondents were the majority at 58%, while the
male were 42% as indicated in Figure 4.1

Figure 4.1: Gender of Respondents

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4.2.2 Age of Respondents
On analysing the ages of the respondents only 11% were aged between 20-25, those of
26-30 were the majority and represented 40%, those aged 31-35 were 23%, and those
above 40 were 5%. This implies that at Radio Africa Group employees are young and can
serve the firm many more years to come, however, the majority are young and in case
they seek greener pastures they might leave the firm in a sorry state.

Figure 4.2: Age of Respondents

4.2.3 Education of Respondents

With regard to education diploma 20%, degree holders were 43% while master holder
were 27%, postgraduate were 10% as indicated. This implies that the employees are well
educated to in their respective departments.

Figure 4.3: Education of Respondents

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4.2.4 Management Level
With regard to management, middle level managers were 75%, while low level managers
accounted for 17%, high level managers were the least at 8%.

Figure 4.4: Management Level

4.2.5. Years Worked

Majority of the employees had worked at the firm for 3-5 years and accounted for 42%,
6-8 years were 27%, while those of less than 2 years were 17% and those of 9 years and
above 15%.

Figure 4.5: Years worked

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4.3 Effect Of Online Advertisement Tools On Consumer Decision
An analysis of the first research objective respondents was asked a set of questions which
they were to rate based on the rating of five; (1) Strongly Disagree, (2) Disagree, (3)
Neutral (4) Agree and (5) Strongly Agree.

4.3.1 Brand awareness and Consumer Decision


The findings revealed that most respondents agreed that online advertising creates interest
and brand awareness (4.35), and its activities have helped increase product and service
awareness (4.28). The findings also show that utilization of online advert provide
feedback which enhances product awareness (4.45) as shown in table 4.2.

Table 4.2: Online Advertisement Tools on Consumer Decision


N Mean SD
Awareness
Online advertising creates interest and brand awareness 60 4.35 .840
Online activities has helped increase product and service 60 4.28 .846
awareness
Use of online advert provide feedback which enhances product 60 4.45 .723
awareness

4.3.2 Brand Equity and Consumer Decision


Most respondents also agreed that internet advertising is more efficient compared to other
media channels (4.32) and it was also more effective compared to other media channels
(4.32). Analysis of the data also revealed that online advertisement create value for
products by making them memorable and easily recognizable (4.42) and social media
marketing has had a significant impact towards building the name of the company and its
products (4.33).

Table 4.3: Brand Equity and Consumer Decision

Brand equity N Mean SD

Internet advertising is more efficient compared to other media 60 4.32 .748


channels.
Internet advertising is more effective compared to other media 60 4.32 .911
channels.
Online advertisement create value for products by making them 60 4.42 .850
memorable and easily recognizable,
Social media marketing has had a significant impact towards 60 4.33 .914
building the name of the company and its products

31
4.3.3 Brand Loyalty and Consumer Decision

There was uncertainty of online advertisement has created a positive attitude towards the
company’s product hence increased firm’s performance (sales revenues, market share,
and profitability) (3.70), however, consumers prefer online advertisement due to the wide
variety it offers them (4.15). It was also agreed that popularity of the content among
online users has increased positive feelings towards a brand (4.05).

Table 4.4: Brand Loyalty and Consumer Decision

Brand Loyalty N Mean SD

Online advertisement has created a positive attitude towards the 60 3.70 1.700
company’s product hence increased firms performance (sales
revenues, market share, profitability)
Consumers prefer online advertisement due to the wide variety it 60 4.15 1.132
offers them
Popularity of the content among online users has increased 60 4.05 1.333
positive feelings towards a brand

4.4. Effects Of Strategies Used On Online Advertising


An analysis of the second research objective respondents were asked a set of questions
which they were to rate based on the rating of five; (1) Strongly Disagree, (2) Disagree,
(3) Neutral (4) Agree and (5) Strongly Agreed.

4.4.1 Effects of Email Marketing on Online Advertising


It was revealed that email marketing increases attitudinal brand loyalty through growing
of the purchasing behavior (4.62), and using Email marketing has enabled easy reach to a
huge number of subscribers on a daily basis (4.55). Respondents also agreed that E-mail
marketing campaigns increased returns on investment (ROI) (4.17).

Table 4.5: Effects of Strategies Used on Online Advertising

Email Marketing N Mean SD


Email marketing increases attitudinal brand loyalty through
growing of the purchasing behaviour 60 4.62 .804
using Email marketing has enabled easy reach to a huge number
of subscribers on a daily basis 60 4.55 .675
E-mail marketing campaigns increased our returns on investment 60 4.17 1.264
(ROI)

32
4.4.2 Effects of Viral Advertising on Online Advertising
Most responded noted that humor and sexuality are the main advertising factors used to
attract consumers to viral ads, (4.18). It was also noted that viral ads encourage
individuals to pass on information that they receive to friends and family (4.40).
Consumers that closely identify with Radio Africa act as agents and spread positive word
of mouth (4.13).

Table 4.6: Effects of Viral Advertising on Online Advertising

Viral Advertising N Mean SD


Humour and sexuality are the main advertising factors used to
attract consumers to viral ads, 60 4.18 1.049
Viral ads encourages individuals to pass on information that
they receive to friends and family 60 4.40 .807
Consumers that closely identify with us act as agents and
spread positive word of mouth 60 4.13 1.171

4.4.3 Effects of Display Ads on Online Advertising


Display ads, have a positive effect on brand awareness and advertising recall (4.27).
There was uncertainty that Radio Africa has used online banners to create awareness and
attract customer’s attention (3.67). Most respondents were uncertain about customers
avoiding banner, pop up advertisement and text advertisement for being annoying (3.63).
However, majority agreed that besides generating a terrible mind-set a lack of usefulness
also can cause un-subscription (4.15). However, there was uncertainty of perceived word
of mouth advertising as a trust trustworthy source of information (3.65) as indicated in
table 4.7

Table 4.7: Effects of Display Ads on Online Advertising

Display Ads N Mean SD


Display ads, have a positive effect on brand awareness and
advertising recall 60 4.27 1.006
We have used online banners to create awareness and attract
customer’s attention 60 3.67 1.623
Our customers avoid banner, pop up advertisement and text
advertisement for being annoying 60 3.63 1.507
Beside generating a terrible mind-set a lack of usefulness also
can cause un-subscription 60 4.15 1.055
We perceive word of mouth advertising as a trust trustworthy
source of information 60 3.65 1.233

33
4.5 Barriers Affecting Online Advertisement On Consumer Decision
An analysis of the third research objective respondents were asked a set of questions
which they were to rate based on the rating of five; (1) Strongly Disagree, (2) Disagree,
(3) Neutral (4) Agree and (5) Strongly Agreed.

4.5.1 Effect of Consumer Attitude on Online Advertisement


The findings established that customer attitude influences their mental position for certain
matter (4.02) and there was uncertainty that consumers attitude can be influence by the
quality of online advertising (3.88). Also according to the findings, the respondents
agreed that nnature of information of the online advert influence consumer decisions to
purchase (4.08) and use and knowledge of social media affect customer attitudes toward
marketing (4.20).

Table 4.8: Consumer Attitude Affect Online Advertisement

Consumer Attitude N Mean SD


Customer attitude influences their mental position for certain 60 4.02 1.662
matter
Consumers attitude can be influence by the quality of online 60 3.88 .958
advertising
Nature of information of the online advert influence consumer 60 4.08 1.046
decisions to purchase.
Use and knowledge of social media affect customer attitudes 60 4.20 .840
toward marketing

4.5.2 Effect of Perceived Privacy Risk on Online Advertisement


The findings revealed that issue of privacy of personal information affect adoption of
online advertising (4.35). The study also established that trust influences online purchaser
and enhances customer’s intention to buy (4.10) and also providing customers with
control over their information reduces customers perceived privacy risk by (4.62).

Table 4.9: Perceived Privacy Risk

Perceived Privacy Risk N Mean SD


Issue of privacy of personal information affect adoption of online 60 4.35 .917
advertising
Trust influences online purchaser and enhances customer’s 60 4.10 1.037
intention to buy
Providing customers with control over their information reduces 60 4.62 .739
customers perceived privacy risk by

34
4.5.3 Effect of Social Economic Factors on Online Advertisement
The findings also revealed that education levels influence consumer use of online
advertising (4.65) and the age determines attitudes that customers exhibit towards
advertising (4.13). The findings also revealed that consumer lifestyle determines attitudes
that customer’s exhibit towards advertising (4.13) and that and increased internet
penetration influences online advertising (4.60). In addition, consumer use of online
advertising varies across their income levels (4.47) and social classes has an impact on
adoption rate of online advertisement (4.41).

Table 4.10: Effect of Social Economic Factors on Online Advertisement

Social Economic Factors N Mean SD


Education levels influences consumer use of online advertising 60 4.65 .659
Age determines attitudes that customers exhibit towards 60 4.13 1.081
advertising
Consumer lifestyle determines attitudes that customers exhibit 60 4.13 1.033
towards advertising
Increased internet penetration influences online advertising 60 4.60 .718
Consumer use of online advertising varies across their income 60 4.47 .911
levels
Social classes has an impact on adoption rate of online 59 4.41 .931
advertisement

4.6 Customer Decision


To analyze the dependent variable respondents were asked a set of questions which they
were to rate based on the rating of five; (1) Strongly Disagree, (2) Disagree, (3) Neutral
(4) Agree and (5) Strongly Agreed.

4.6.1 Descriptive on Customer Decision

The findings revealed that perception of online advertising influences customer decision
to seek the service (4.62) and motivation of online advertising influences customer
decision (4.42). The findings revealed that cost saving positively affect consumer’s
intention to seeking online advertising (4.53) while convenience was found to create an
intention to continue seeking online advertising (4.67).

35
Table 4.11: Descriptive on Customer Decision

Statement N Mean SD
Perception of online advertising influences customer decision to
seek the service 60 4.62 .715
Motivation of online advertising influences customer decision 60 4.42 .743
Cost saving positively affects consumer’s intention to seeking
online advertising. 60 4.53 .700
Convenience creates an intention to continue seeking online
advertising. 60 4.67 .705

4.7 Inferential Analysis

4.7.1 Reliability Test


According to Sekeran (2008) the minimum acceptable Alpha value is 0.7, thus any value
of 0.7 and above is considered reliable. The findings shows that barriers affecting online
advertisement on consumer decision had the highest reliability (α= 0.814), followed by
strategies used on online advertising (α=0.759), online advertisement tools on consumer
decision (α=0. 722), and customer decision (α=0.714). This illustrates that all the four
variables were reliable as their reliability values fall above 0.7.

Table 4.12: Reliability Test

Scale Cronbach's Number of


Alpha Items
Online advertisement tools on consumer decision 0.722 10
Strategies used on online advertising 0.759 11
Barriers affecting online advertisement on consumer 0.814 13
decision
Customer Decision 0.714 4

4.7.2 Correlation Analysis


A correlation analysis was done between Customer decision (dependent variable) and
Online advertisement, Strategies used and barriers affecting online advertisement. As
indicated in table 4.7. The study revealed that there was a positive correlation between
customer decision and online advertisement (rho .0547, pvalue 0.000); Strategies Used
(rho.0.543, pvalue 0.000); Barrier of online advertisement (rho 0.721, pvalue 0.000) as

36
indicated. This implies that with every increase in online advertisement tools on
consumer decision and strategies used on online advertising.

Table 4.13: Correlation Analysis

Variable CD OA SU BA

1
CD

.574** 1
OA
.000
.543** .804** 1
SU .000 .000
60 60 60 60

Where:
CA, Customer Decision; OA, Online advertisement tools; SU, Strategies Used

4.8 Chapter Summary


This chapter presented the results and findings attained from the data analysis done. This
was done with regard to the specific research objective which was to establish the effect
of online advertisement tools on consumer decision, to determine effects of strategies
used on online advertising and to establish barriers affecting online advertisement on
consumer decision. The descriptive and inferential statistics were computed and the data
presented inform of figures and tables. The next chapter will cover the discussion
conclusion, and recommendation as per the literature reviewed.

37
CHAPTER FIVE

5.0 DISCUSSION, CONCLUSION AND RECOMMENDATION

5.1 Introduction
This section offers the discussions in line with the specific objective of the study and the
discussions will be done in line with the literature review from previous studies. This
chapter will also offer the conclusions and recommendations from the study.

5.2 Summary
The general objective of the study was to establish the effectiveness of online
advertisement on consumer decision. The study is guided by the following objectives; To
establish the effect of online advertisement tools on consumer decision, to determine
effects of strategies used on online advertising and to establish barriers affecting online
advertisement on consumer decision.

A descriptive research design was used to describe variables. In addition, it is also used to
determine frequency with which something occurs or relationship between variables.
Further, correlation was done to identify relationship between dependent and independent
variables. The target population for this study was 80 employees at radio Africa from
where a sample of 67 respondents was arrived at however only 60 responded.
Questionnaires were self-administered. They were dropped and picked immediately
respondents are done filling them. Respondents was given ample time to answer the
questionnaire. The questionnaire was sub divided into sub section based on the research
objective whereas the first part was based on demography. Likert sale was used because it
is used to measure level of respondents or consent rate satisfaction questionnaire was
designed and pre-tested amongst five members. Pre-test was done to ensure that data
collected are valid and accurate. Feedback received from the pre-test was incorporated
into the questionnaire before administering the final copy Descriptive research was used
to analyze data. Data collected will then be sorted and findings were presented using
tables, figures, and charts. Statistical Package for Social Sciences (SPSS) software was
used to code and analyze data.

The findings revealed that most respondents agreed that online advertising creates interest
and brand awareness, and their activity has helped increase product and service

38
awareness. The findings also show that utilization of online advert provide feedback
which enhances product awareness. Most respondents also agreed that internet
advertising is more efficient compared to other media channels and it was also more
effective compared to other media channels.

Analysis of the data also revealed that online advertisement create value for products by
making them memorable and easily recognizable and social media marketing has had a
significant impact towards building the name of the company and its products. There was
uncertainty of online advertisement has created a positive attitude towards the company’s
product hence increased firm’s performance (sales revenues, market share, profitability.
However, it was revealed that consumers prefer online advertisement due to the wide
variety it offers them. It was also agreed that popularity of the content among online users
has increased positive feelings towards a brand.

It was revealed that email marketing increases attitudinal brand loyalty through growing
of the purchasing behavior, and using Email marketing has enabled easy reach to a huge
number of subscribers on a daily basis. Most responded noted that humor and sexuality
are the main advertising factors used to attract consumers to viral ads. It was also noted
that viral ads encourage individuals to pass on information that they receive to friends and
family. Consumers that closely identify with Radio Africa act as agents and spread
positive word of mouth and display ads, have a positive effect on brand awareness and
advertising recall. There was uncertainty that Radio Africa has used online banners to
create awareness and attract customer’s attention. Respondents also agreed that E-mail
marketing campaigns increased returns on investment (ROI).

Most respondents were uncertain about customers avoiding banner, pop up advertisement
and text advertisement for being annoying. However, majority agreed that besides
generating a terrible mind-set a lack of usefulness also can cause un-subscription.
However, there was uncertainty of perceived word of mouth advertising as a trust
trustworthy source of information.

The findings established that customer attitude influences their mental position for certain
matter and there was uncertainty that cconsumers attitude can be influence by the quality
of online advertising. Also, according to the findings, the respondents agreed that nature
of information of the online advert influence consumer decisions to purchase and use and

39
knowledge of social media affect customer attitudes toward marketing and the age
determines attitudes that customers exhibit towards advertising.

The findings also revealed that consumer lifestyle determines attitudes that customers
exhibit towards advertising and that issue of privacy of personal information affect
adoption of online advertising. The study also established that trust influences online
purchaser and enhances customer’s intention to buy and also pproviding customers with
control over their information reduces customers perceived privacy risk.

The findings also revealed that education levels influence consumer use of online
advertising and iincreased internet penetration influences online advertising. In addition,
cconsumers use of online advertising varies across their income levels and social classes
have an impact on adoption rate of online advertisements.

5.3 Discussion

5.3.1 Effect of Online Advertisement Tools on Consumer Decision


The findings revealed that most respondents agreed that online advertising creates interest
and brand awareness. Indeed, online advertisements outperform the print advertisements
because the web’s vividness and interactivity characteristics cater for differences in how
advertisements are processed in the two media (Belanche, Flavián, & Pérez-Rueda,
2017). Compared to print, online advertising offers more stimuli and could thus
potentially effectively create brand awareness and keep the user’s attention and interest
longer. Advertising is the primary revenue stream for many of the ‘‘free’’ services
provided to Internet users (Castro, 2012) and is essential to the continued economic
sustainability of many services, such as email, news and search engines.

The findings also show that utilization of online advert provide feedback which enhances
product awareness. Pawar, (2014), in his research on the effectiveness of online
marketing in India noted that companies should use online activities in their marketing
efforts to increase product as service awareness since online activities facilitate good
access and higher reach to the customers. Therefore, companies must take this
advantage by incorporating online advertising in their marketing strategy. Online video
directories for brands are a good example.

40
Most respondents also agreed that internet advertising is more efficient compared to other
media channels. This concurs with Rastogi and Khan, (2015) who agreed that advertising
on the Internet has the dual benefit of being generally more efficient and effective
compared to other media channels. According to the authors, the effectiveness of creating
brand and product awareness through online advertising, for instance can be measured
using a variety of tracking methods through which advertiser can tell, for example, who
clicked on their online advert and therefore determine how many consumers are aware of
their product or service.

Social media marketing has had a significant impact towards building the name of the
company and its products. Rana (2011) in her study on the impact of social-media use on
brand equity of magazine brands a qualitative study of Vogue Turkey findings indicated
that social media marketing has significant impact towards building brand equity.
Furthermore, online communities, interaction, and sharing of content were also found to
have significant impact on brand equity.

However, consumers prefer online advertisement due to the wide variety it offers them.
Erdoğmuş & Cicek (2012) state that consumer brand loyalty is also affected by the
different platforms and applications that are offered by the brand on the internet,
what might imply that consumers are asking for creative reasons, variety, and
differences for engaging with the brands on social media. Pawar, (2014) agrees that
companies should work on creating more engaging, interesting applications, games and
content to increase brand loyalty.

It was also agreed that popularity of the content among online users has increased positive
feelings towards a brand. Goldsmith and Lafferty (2002) in their study on consumer
response to Web site and their influence on advertising effectiveness findings revealed
that consumer who have a positive attitude towards an online advertisement are more
likely to recall the advertisement that those who have a negative attitude. Chu (2011)
customer’s attitude towards the website indicates their attitude towards its content:
Customers are more likely to accept and rely on information they see on a website they
appreciate.

41
5.3.2 Effects of Strategies Used on Online Advertising
It was revealed that email marketing increases attitudinal brand loyalty through growing
of the purchasing behavior, According to Hampsey (2013) in his study on the influence of
email marketing messages it was revealed that 66% of customers have made a purchase
as a result of an e-mail marketing campaign. Merisavo and Raulas (2004) concluded that
consumers establish special sales offers, facts on new merchandise and contests useful
matters in e mail commercial. The aim of the store visit in 40.4% of the cases varied, in
different cases the purchasers wanted to have a first-hand experience, or gain extra
information or get private recommendation (Martin, Van Durme et al. 2003). This
suggests that email marketing increases attitudinal and behavioral brand loyalty through
growing of the purchasing behavior.

The study revealed that using Email marketing has enabled easy reach to a huge number
of subscribers on a daily basis. Monetate (2014) adds that by using the service advertisers
can easily reach a huge number of subscribers on a daily basis as previous research has
noted that 91% of consumers do check their e-mail on a regular basis.

Most responded noted that humor and sexuality are the main advertising factors used to
attract consumers to viral ads and it was also noted that viral ads encourage individuals to
pass on information that they receive to friends and family. Golan and Zaidner (2008) in
their study on viral advertising in large company’s findings revealed that humor and
sexuality are the main advertising factors used to attract consumers to viral ads, and if
consumers are entertained by the ads, they are more likely to share or pass on the ads to
their friends and family. Victoria (2008). Viral marketing is used to pass adverts,
animations, photos, hyperlinked promotions, newsletters, games, press releases, or
petitions. This type of marketing encourages individuals to pass on information that they
receive to friends and family. Viral marketing also create a buzz around a product or
service.

It was revealed that display ads, have a positive effect on brand awareness and advertising
recall. Dreze and Hussherr (2003) in their study noted that although customers avoid
looking at display ads, they still have a positive effect on brand awareness and advertising
recall. Danaher and Mullarkey (2003) in his research on findings revealed that banner ads
have more influence on individuals who are browsing.

42
Respondents also agreed that E-mail marketing campaigns increased returns on
investment (ROI). E-mail marketing campaigns have been linked to the associated
increase in returns on investment (ROI) than other forms of online marketing (Pavlov,
2008). However, there are yet a few studies undertaken on the effectiveness and
profitability of e-mail marketing campaigns (Cho, 2006). Using E marketing enables
companies to track the exact ROI and this therefore permits them to measure the
performance of the campaign.

Most respondents were uncertain about customers avoiding banner, pop up advertisement
and text advertisement for being annoying. According to Chatterjee (2008) customers
usually avoid banner, pop up advertisement and text advertisement because they are
perceived to be annoying. Gitanjali and Ashutosh (2016) in their research on effects of
online advertising on consumer it was revealed that banners and pop up ads are annoying
and intrusive. Consumers notice banner ads because of their relevancy and location on the
page and should include bright colors, interactivity, graphics, videos, logos, sizes and
discounts.

5.3.3 Barriers Affecting Online Advertisement on Consumer Decision


The findings established that customer attitude influences their mental position for certain
matter. According to Mehta (2000), consumer’s attitude towards online advertising is
one of the influential factors of effectiveness of online advertising as consumer’s
cognitive ability towards the online advertisement are reflected in their thoughts as
well as feelings and subsequently will influence their attitude towards online
advertising. Consumers attitude can be influence by factors of online advertising such as;
credibility, in-formativeness, pleasure and materialism. Credibility is the consumer’s
perception towards the credibility, trustworthiness, believability, and convincibility of an
online advertisement.

There was uncertainty that cconsumers attitude can be influence by the quality of online
advertising. Goldsmith and Lafferty (2002) in their study on consumer response to Web
site and their influence on advertising effectiveness findings revealed that consumer who
have a positive attitude towards an online advertisement are more likely to recall the
advertisement that those who have a negative attitude. Chu (2011) customer’s attitude
towards the website indicates their attitude towards its content: Customers are more likely
to accept and rely on information they see on a website they appreciate.

43
Also, according to the findings, the respondents agreed that the nature of information of
the online advert influence consumer decisions to purchase and Akar and Topçu (2011) in
their research on factors that affect the attitude of the consumers towards embracing
marketing through the social media findings revealed that use of social media,
knowledge of social media, following of social media, and fears about marketing with
social media all have an effect on attitudes toward marketing with social media,
According to research done by Campbell et al, (2014) and Kelly et al, (2010) on effects of
consumer attitude on online advertising, findings revealed that consumers often have a
certain inclination to avoid advertising. Taylor et al., (2011) in their study on friends,
fans, and followers: do ads work on social networks findings revealed that 22% of
consumers had a positive attitude towards digital advertising, and 8% had left a certain
social network because of what they felt as excessive publicity.

The study established that the age of user determines attitudes that customers exhibit
towards advertising. Dutta-Bergman (2006) states that demographic and lifestyle
determines attitudes that customers exhibit towards advertising but suggests that younger
customers rely less on advertising for decision making compared to their older
counterparts. According to a study done by Shavitt et al, (2008) study on psychographic
variables related to attitudes towards advertising, findings revealed that younger people
were more likely to show positive attitudes towards advertising and were less
likely to feel offended or insulted by advertising which Mehta (2000) argues translates
to better message recall.

It was also revealed that issues of privacy of personal information affect adoption of
online advertising. Consumers are becoming more concerned about is accessing and using
their personal information left behind from their online and unauthorized sharing of their
personal information by marketers with third parties (Myerscough et al., 2006).
Customers are faces with risk of their private information being accessed by unauthorized
users because the information can easily be transferred between social media sites.
Additionally, over sharing of information increases vulnerability of location based
information hence threat to their private life. (Rose, 2011) According to Dinev et al
(2013) customers perceived risk can be influenced by trust, self-efficacy, and structural
assurances

44
5.4 Conclusion

5.4.1 Effect of Online Advertisement Tools on Consumer Decision


Online advertising is important to a firm like Radio Africa that relies on communication
to create interest and brand awareness. The findings also show that utilization of online
advert provide the necessary feedback which enhances product awareness to the clients as
well as give them the opportunity to offer their wide variety of products on one platform.

5.4.2 Effects of Strategies Used on Online Advertising


Marketing strategies applied determine increases brand loyalty and therefore influence
purchasing behavior of the services and products offered. The content used in these
strategies is important in determining the awareness and attraction of customer’s attention
which influences the bottom line.

5.4.3 Barriers Affecting Online Advertisement on Consumer Decision


Customer have an attitude and the type of attitude exhibited influences their mental
position for certain matter. Some of this peculiar attitudes are determined by the quality
of online advertisement used and the of information of the online advert. Also different
group of customers have varied attitude towards the adverts and this depends a lot on the
demography of the clients by age and lifestyle. Other issues of privacy and internet
connectivity also influence the same.

5.5 Recommendation

5.5.1 Recommendation for Improvement


5.5.1.1 Effect of Online Advertisement Tools on Consumer Decision

Radio Africa needs to ensure that the online tools adopted creates the most interest and
brand awareness among its consumers. While utilization of online advert provides
feedback, the firm should ensure that the feedback is taken seriously to retain consumers
and building the name of the company. The firm should also ensure that and its wide
variety is easily accessible by the consumers in order to maintain the positive feelings
towards the brand.

45
5.5.1.2 Effects of Strategies Used On Online Advertising

Radio Africa group needs to analyze and there after determining what strategies gives the
highest value to the consumers. The content should also resonate well with the target
audiences. While it is uncertain whether customers avoid banner, pop up advertisement
and text advertisement for being annoying there is a need to establish the facts.

5.5.1.3 Barriers Affecting Online Advertisement on Consumer Decision

The firm needs to establish ways of ensuring they maintain a positive customer attitude
and this could be done by ensuring a high quality of online advertising. There is also a
need to ensure that the nature of information of the online advert positively influence
consumer decisions to purchase.

5.5.2 Recommendation for Further Studies


The study was set to establish the effectiveness of online advertisement on consumer
decision. The main focus has been on the effect of online advertisement tools, effects of
strategies and barriers affecting online advertisement on consumer decision at Radio
Africa. There is a need to do further studies at Radio Africa to establish if online
advertisement has created a positive attitude towards the company’s product hence
increased firm’s performance (sales revenues, market share, profitability). Similar studies
can also be done on other institution in order to generalize the findings.

46
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60
APPENDIX 1 : QUESTIONNAIRE

Effectiveness of online advertisement on consumer decision. A case of radio Africa group


limited Nairobi, Kenya questionnaire

SECTION A: GENERAL INFORMATION

1. Gender
Male
Female
2. Age
20-25
26-30
31-35
36-40
Above 40

3. What is your highest level of education?


Diploma
Under graduate
Graduate
Postgraduate
Others
4. Management Level
High
Medium
Low

61
5. Number of years worked in the organization

Less than 2
3–5
6-8
Above 9

SECTION B: Effects of online advertisement tools on consumer decision


What is your level of agreement with the following statements on the effects of online
advertisement tools on consumer decision (5- Strongly agree, 4- Agree, 3-Neutral, 2-
Disagree, 1- Strongly Disagree)

Disagree
Disagree
Strongly

Strongly
Neutral

Agree

Agree
Statement

1 Online advertising creates interest and brand


awareness 1 2 3 4 5

2 online activities has helped increase product and


1 2 3 4 5
service awareness
3 Use of online advert provide feedback which
1 2 3 4 5
enhances product awareness
4 Internet advertising is more efficient compared to
1 2 3 4 5
other media channels.
5 Internet advertising is more effective compared to
other media channels.
6 Online advertisement create value for products by
1 2 3 4 5
making them memorable and easily recognizable,
7 Social media marketing has had a significant impact
towards building the name of the company and its 1 2 3 4 5
products
8 Online advertisement has created a positive attitude
towards the company’s product hence increased firms
1 2 3 4 5
performance (sales revenues, market share,
profitability)
9. Consumers prefer online advertisement due to the
1 2 3 4 5
wide variety it offers them
10. Popularity of the content among online users has
increased positive feelings towards a brand

What other online advertisement tools affect consumer decision


________________________________________________________________________

62
________________________________________________________________________
_____________________________________________________________________
SECTION C: effects of online advertisement Strategies on consumer decision

On a scale of 1-5 where; 1-Strongly Disagree; 2-Disgaree; 3-Neutral; 4-Agree; and 5-


Strongly Agree, indicate your level of agreement in relation to effects of online
advertisement Strategies on consumer decision

Disagree

Disagree
Strongly

Strongly
Neutral

Agree

Agree
Statement

1. Email marketing increases attitudinal brand loyalty


through growing of the purchasing behaviour 1 2 3 4 5
2. using Email marketing has enabled easy reach to a
huge number of subscribers on a daily basis
3. Humour and sexuality are the main advertising factors
1 2 3 4 5
used to attract consumers to viral ads,
4 Viral ads encourages individuals to pass on
1 2 3 4 5
information that they receive to friends and family
5. Consumers that closely identify with us act as agents
1 2 3 4 5
and spread positive word of mouth
6. Display ads, have a positive effect on brand awareness
1 2 3 4 5
and advertising recall
7. We have used online banners to create awareness and
1 2 3 4 5
attract customer’s attention
8. E-mail marketing campaigns increased our returns on
1 2 3 4 5
investment (ROI)
9. Our customers avoid banner, pop up advertisement and
1 2 3 4 5
text advertisement for being annoying
10 Beside generating a terrible mind-set a lack of
1 2 3 4 5
usefulness also can cause unsubscription
11 We perceive word of mouth advertising as a trust
trustworthy source of information

What other effects of online advertisement strategies affect consumer decision in your
organisation?
________________________________________________________________________
______________________________________________________________________

63
SECTION D: Barriers affecting online advertising and consumer decision

On a scale of 1-5 where; 1-Strongly Disagree; 2-Disgaree; 3-Neutral; 4-Agree; and 5-


Strongly Agree, indicate your level of agreement in relation to the barriers affecting
online advertisement tools on consumer decision

Disagree
Disagree
Strongly

Strongly
Neutral

Agree

Agree
Statement

1. Customer attitude influences their mental position for


1 2 3 4 5
certain matter
2. Consumers attitude can be influence by the quality of
1 2 3 4 5
online advertising
3. Nature of information of the online advert influence
1 2 3 4 5
consumer decisions to purchase.
4. Use and knowledge of social media affect customer
1 2 3 4 5
attitudes toward marketing
5. Age determines attitudes that customers exhibit towards
1 2 3 4 5
advertising
6. Consumer lifestyle determines attitudes that customers
1 2 3 4 5
exhibit towards advertising
7. Issue of privacy of personal information affect adoption
1 2 3 4 5
of online advertising
8. Trust influences online purchaser and enhances
1 2 3 4 5
customer’s intention to buy
9 Providing customers with control over their information
1 2 3 4 5
reduces customers perceived privacy risk by
10 Education levels influences consumer use of online
1 2 3 4 5
advertising
11 Increased internet penetration influences online
1 2 3 4 5
advertising
12 Consumer use of online advertising varies across their
1 2 3 4 5
income levels
13 Social classes has an impact on adoption rate of online
1 2 3 4 5
advertisement

What other Barriers affect online advertisement tools on consumer decision


________________________________________________________________________

64
______________________________________________________________________

SECTION E: Customer Decision

To what extent have the following factors affect Customer Decision in your organisation?
(5- Strongly agree, 4- Agree, 3-Neutral, 2-Disagree, 1- Strongly Disagree)

Disagree

Disagree
Strongly

Strongly
Neutral

Agree

Agree
Statement

1 Perception of online advertising influences customer


1 2 3 4 5
decision to seek the service
2 Motivation of online advertising influences customer
1 2 3 4 5
decision
3 Cost saving positively affect consumer’s intention to
1 2 3 4 5
seeking online advertising.
4 Convenience creates an intention to continue seeking
online advertising 1 2 3 4 5

65

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