Abstract:
Advertising is any paid form of non-personal communication about a business, its product or service to a target audience, through a mass medium carried out by an identified sponsor. This promotional tool is used by Small and Medium Enterprises (SMEs) to create awareness about businesses products, services or existence, as well as to communicate with potential consumers. Thus, this dissertation explores the involvement and participation of managers or owners of SMEs with regards to their role in advertising their products and services in order to boost their profit and sustaining their businesses. The dissertation specifically focuses on the effectiveness of various advertising media used as a promotional tool to boost profitability and sustainability of SMEs. It also evaluates whether the money spend on advertising by businesses is profitable and sustainable. Therefore, the main objective of this study is to determine the effectiveness of various advertising media, such as broadcast, print, outdoor and internet media, on profitability and sustainability of SME’s in Welkom.
A mixed methods design which included the use of a questionnaire and semi structured interviews were utilized in this study. Ten respondents from SMEs and two hundred consumer respondents were interviewed in this study. The quantitative part of this study investigated the effect of various advertising media on decision making of consumers regarding products or services. The significant relationship between age, gender and decision making were also examined. The qualitative part of the study investigated the role of advertising with regards to profitability and sustainability within SMEs.
The findings indicate that most SMEs managers and owners do not know whether advertising boosts the business’ profit or not. The implications of these findings are that SMEs have been spending money on advertising media which are not feasible for return on investment. In addition, managers and owners of SMEs do not have a clear understanding of the reasons for and importance of advertising their products or services. Therefore, the researcher recommends that managers and owners of SMEs should consider hiring third year marketing students or marketers to develop marketing plans for their businesses.
The study observes that there are continuous changes and a rise in advertising expenditure which are witnessed every year, while businesses are unaware of the advertising media that influences consumers to purchase their products or services. In conclusion managers and owners of SMEs should be encouraged to examine the effectiveness of various advertising media on their consumers.
