The effect of advertising on sales turnover: A Case Study of MTN Nigeria

 Corresponding author: Yusuff Taofiq Olasunkanmi ORCID: 0009-0003-6020-4195 Copyright © 2025 Author(s) retain the copyright of this article. This article is published under the terms of the Creative Commons Attribution Liscense 4.0. The effect of advertising on sales turnover: A Case Study of MTN Nigeria Ugowe Samson Omoruyi 1, Taofiq Olasunkanmi Yusuff 2, *, Tunde Omololu Magbadelo 3, John Oluwademilade Adewumi 4, Quadri Ige Adeshola 5 and Isaiah Osaze Omonfomhan 6 1 Department of Marketing, Faculty of Management Science, Irish University Business School, London. 2 Department of Marketing, Faculty of Business and Management Studies, Yaba College of Technology, Nigeria. 3 Department of Finance Analytics, Kogod Business School, American University, USA. 4 Department of Business Administration, Faculty of management science, Nassarawa State University, Keffi. Nigeria. 5 Department of business administration, Faculty of Business and management Studies, Osun state polytechnic iree, Nigeria. 6 Department of Mass Communication, Faculty of Art, University of Benin, Edo State. Nigeria. World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 Publication history: Received on 30 April 2025; revised on 11 June 2025; accepted on 13 June 2025 Article DOI: https://doi.org/10.30574/wjarr.2025.26.3.2293 Abstract This study investigates the relationship between advertising expenditure and sales turnover using MTN Nigeria Limited as a case study. The research employed a survey design with a sample of 45 respondents from MTN Nigeria's management and staff. Data were collected through structured questionnaires and analyzed using descriptive statistics and chi-square tests. Results indicate a significant positive relationship between advertising and sales turnover, with 89% of respondents confirming that advertising influences customer buying decisions. The study found that 84% of respondents agreed that advertising leads to annual profit increases, while 89% confirmed that continuous advertising results in sustained customer patronage. These findings suggest that advertising serves as a critical tool for enhancing organizational performance and market competitiveness in the telecommunications sector. Keywords: Advertising effectiveness; Sales turnover; Marketing communication; Telecommunications industry; Nigeria 1. Introduction In today's competitive business environment, organizations face the dual challenge of producing quality goods and services while creating awareness to ensure continuous patronage (Kotler & Keller, 2016). Advertising, as a key component of the promotional mix, has emerged as a critical determinant of organizational success and market positioning (Tellis, 2004). The relationship between advertising expenditure and sales performance has been a subject of extensive scholarly debate, with researchers presenting varying perspectives on its effectiveness (Vakratsas & Ambler, 1999). The strategic importance of advertising has intensified in recent decades as markets have become increasingly saturated and consumer choices have multiplied exponentially. Organizations now recognize that superior product quality alone is insufficient to guarantee market success; effective communication strategies are essential for creating brand differentiation and maintaining competitive advantage (Porter, 1985). This paradigm shift has elevated advertising from a peripheral marketing activity to a core strategic function that directly influences organizational performance and long-term sustainability. The digital revolution has further transformed the advertising landscape, creating new opportunities and challenges for marketers across various industries. Traditional advertising mediums continue to coexist with digital platforms, World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 1682 requiring organizations to develop integrated communication strategies that maximize reach and effectiveness while optimizing resource allocation (Fill & Turnbull, 2016). This evolution has made the measurement and evaluation of advertising effectiveness more complex yet increasingly critical for strategic decision-making. The telecommunications industry exemplifies the strategic role of advertising in highly competitive markets, where service differentiation is often minimal and customer loyalty is constantly challenged by aggressive competitor actions. In this context, advertising serves not only as an information dissemination tool but also as a means of building emotional connections with consumers and establishing brand preferences that transcend functional product attributes (Solomon, 2020). The effectiveness of advertising investments in driving sales performance therefore becomes a critical factor in determining organizational success and market leadership. The American Marketing Association defines advertising as "any paid form of non-personal presentation of ideas, goods and services by an identified sponsor" (AMA, 2017). This definition underscores the mass communication nature of advertising and its persuasive intent to influence consumer behavior (Fill & Turnbull, 2016). Despite criticisms that advertising represents wasteful spending, empirical evidence suggests that effective advertising creates product awareness, provides essential product information, and encourages sales while helping organizations capture larger market shares (Bagwell, 2007). The telecommunications industry in Nigeria presents a particularly interesting context for examining advertising effectiveness due to intense competition among service providers and the rapid adoption of mobile technology (Adeleke & Aminu, 2012). MTN Nigeria, as the largest telecommunications operator in the country, provides an excellent case study for understanding how advertising investments translate into sales performance in emerging markets. 2. Literature Review 2.1. Theoretical Framework The relationship between advertising and sales has been examined through various theoretical lenses. The hierarchy of effects model suggests that advertising works through a sequential process of awareness, interest, desire, and action (Lavidge & Steiner, 1961). More recent theoretical developments include the elaboration likelihood model (Petty & Cacioppo, 1986) and the dual mediation hypothesis (MacKenzie et al., 1986), which provide frameworks for understanding how advertising influences consumer behavior. The theoretical foundations of advertising effectiveness have evolved significantly over the past several decades, incorporating insights from psychology, economics, and consumer behavior research. The hierarchy of effects model, while foundational, has been criticized for its linear assumption about consumer decision-making processes, leading to the development of more sophisticated models that account for the complexity of modern consumer behavior (Solomon, 2020). Contemporary theoretical frameworks recognize that advertising effectiveness is influenced by multiple factors including message content, media selection, timing, frequency, and the broader marketing context in which advertising operates. 2.2. Advertising Effectiveness Studies Empirical research on advertising effectiveness has produced mixed results. Srinivasan et al. (2005) found a positive relationship between advertising spending and market share in consumer goods markets. Similarly, Joshi and Hanssens (2010) demonstrated that advertising investments generate both short-term sales increases and long-term brand equity benefits. However, studies by Abraham and Lodish (1990) suggest that advertising effectiveness varies significantly across product categories and market conditions. The measurement of advertising effectiveness has become increasingly sophisticated, incorporating advanced econometric techniques and longitudinal analysis methods to capture both immediate and delayed effects of advertising exposure (Hanssens et al., 2001). Recent research has also emphasized the importance of understanding advertising's interaction with other marketing mix elements, revealing that advertising effectiveness is often amplified when integrated with promotional activities, product improvements, and distribution enhancements (Dinner et al., 2014). These findings highlight the need for organizations to adopt holistic approaches to advertising measurement that consider synergistic effects across multiple marketing channels and touchpoints. In the telecommunications sector specifically, Kim and Morris (2003) found that advertising plays a crucial role in customer acquisition and retention. Their study of mobile service providers revealed that consistent advertising World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 1683 campaigns significantly impact subscriber growth and revenue generation. Similarly, Danaher et al. (2008) demonstrated that telecommunications advertising effectiveness is enhanced when integrated with other marketing communication tools. 2.3. Advertising in Emerging Markets Research on advertising effectiveness in emerging markets presents unique insights. Burgess and Steenkamp (2006) argue that advertising in developing economies faces challenges related to media fragmentation, cultural diversity, and varying literacy levels. However, studies by Naik and Peters (2009) suggest that these challenges can be overcome through culturally adapted advertising strategies. The dynamics of advertising in emerging markets differ substantially from those in developed economies, requiring organizations to adapt their strategies to local market conditions and consumer characteristics. Cultural sensitivity becomes particularly important in diverse markets like Nigeria, where multiple ethnic groups, languages, and socioeconomic segments require tailored communication approaches (Okafor, 2015). Additionally, emerging markets often exhibit different media consumption patterns and technology adoption rates, necessitating careful consideration of media mix decisions to optimize advertising reach and effectiveness across diverse consumer segments. In the Nigerian context, Okafor (2015) examined advertising practices across various industries and found that companies with higher advertising investments typically achieve superior market performance. Adebayo and Iweka (2014) specifically studied the telecommunications sector and concluded that advertising intensity positively correlates with customer acquisition rates and revenue growth. 2.4. Measuring Advertising Effectiveness The measurement of advertising effectiveness has evolved from simple awareness metrics to comprehensive ROI assessments (Farris et al., 2010). Modern approaches include econometric modeling (Hanssens et al., 2001), marketing mix modeling (Dinner et al., 2014), and attribution analysis (Li & Kannan, 2014). These methodologies enable organizations to quantify the relationship between advertising investments and business outcomes more precisely. Contemporary measurement approaches recognize that advertising effects extend beyond immediate sales responses to include long-term brand building, customer lifetime value enhancement, and competitive positioning benefits that may not be immediately apparent in short-term sales data (Joshi & Hanssens, 2010). This comprehensive view of advertising effectiveness has led to the development of multi-touch attribution models and customer journey analytics that track the cumulative impact of advertising exposure across multiple touchpoints and time periods, providing more accurate assessments of advertising's true contribution to organizational performance. 3. Research Methodology 3.1. Research Design This study employed a survey research design to investigate the relationship between advertising (independent variable) and sales turnover (dependent variable). The choice of survey methodology was appropriate given the need to collect primary data on employee perceptions and organizational performance indicators. The cross-sectional design allowed for efficient data collection within a specific timeframe while providing insights into current advertising practices and their perceived effectiveness within MTN Nigeria. The survey approach was selected over alternative methodologies such as experimental design or longitudinal studies due to practical considerations including time constraints, resource availability, and access limitations. While experimental designs might provide stronger causal inference, the organizational context of MTN Nigeria made it impractical to manipulate advertising variables for research purposes. The survey design, therefore, represented the most feasible approach for gathering comprehensive data on employee perceptions and experiences regarding advertising effectiveness within the organization. 3.2. Population and Sampling The study population comprised employees of MTN Nigeria Limited across different organizational levels and functional departments. The target population included all permanent employees who had been with the organization for at least six months, ensuring adequate exposure to the company's advertising strategies and their business impact. A sample of World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 1684 50 respondents was selected using probability sampling with random selection techniques to ensure representativeness across the organization. The sampling frame was constructed using the company's employee directory, stratified by organizational level to ensure proportional representation across management, senior staff, and junior staff categories. Random selection within each stratum was employed to minimize selection bias and enhance the generalizability of findings. The sample included management staff (29%), senior staff (60%), and junior staff (11%), ensuring representation across organizational hierarchies and functional areas including marketing, sales, operations, and support functions. Sample size determination was based on statistical power considerations and practical constraints. A minimum sample size of 45 was calculated using standard formulas for survey research, assuming a 95% confidence level and 5% margin of error. The final sample of 45 respondents (representing a 90% response rate) exceeded the minimum requirement and provided adequate statistical power for the planned analyses. 3.3. Data Collection Primary data were collected using structured questionnaires divided into three main sections: biographical data, advertising variables, and sales turnover indicators. The questionnaire was developed based on extensive literature review and adapted from validated instruments used in previous advertising effectiveness studies. Pre-testing was conducted with a small group of MTN employees to ensure clarity, relevance, and comprehensiveness of the survey items. The questionnaire employed a Likert-type 3-point scale (Yes/No/Undecided) for response measurement, chosen for its simplicity and ease of administration in the organizational context. While more detailed scales might provide greater response variance, the 3-point scale was deemed appropriate for capturing clear positions on advertising effectiveness while minimizing response burden on participants. The survey was administered both electronically and in hard copy format to accommodate different respondent preferences and ensure maximum participation. Data collection procedures included multiple follow-up contacts to maximize response rates and minimize nonresponse bias. The survey was distributed over a four-week period, with weekly reminders sent to non-respondents. Personal visits were made to key departments to encourage participation and address any questions or concerns about the survey. These efforts resulted in a high response rate of 90%, with 45 completed questionnaires out of 50 distributed. 3.4. Data Analysis Data analysis involved multiple stages, beginning with data cleaning and validation to ensure accuracy and completeness. Descriptive statistics were computed for all variables to provide comprehensive summaries of respondent characteristics and response patterns. Frequency distributions and percentages were calculated for categorical variables, while measures of central tendency and dispersion were computed for any continuous variables. Chi-square correlation analysis was employed for hypothesis testing, selected as appropriate for examining relationships between categorical variables in the study. The chi-square test of independence was used to determine whether observed relationships between advertising variables and sales performance indicators were statistically significant or could be attributed to chance. Statistical significance was evaluated at both 0.05 and 0.01 levels to provide robust assessment of relationship strength. Additional analyses included cross-tabulation to examine relationships between respondent characteristics and key variables, as well as exploratory analysis to identify patterns and trends in the data. All statistical analyses were conducted using appropriate software packages, with results validated through manual calculations for key findings to ensure accuracy and reliability. 4. Results and Discussion 4.1. Respondent Demographics The gender distribution shows a male-dominated workforce among respondents, with males representing two-thirds of the sample. This distribution is typical of the telecommunications industry in Nigeria, where male employees traditionally outnumber females in technical and managerial positions. World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 1685 Table 1 Gender Distribution of Respondents Gender Frequency Percentage (%) Male 30 67 Female 15 33 Total 45 100 Table 2 Age Distribution of Respondents Age Group Frequency Percentage (%) 21-30 years 25 56 31-40 years 12 27 41-50 years 8 17 51+ years 0 0 Total 45 100 The age distribution reveals a predominantly young workforce, with over half of respondents (56%) falling within the 21-30 age bracket. This demographic profile suggests that MTN Nigeria employs relatively young professionals, which aligns with the dynamic nature of the telecommunications industry and its preference for digitally native employees. Table 3 Marital Status of Respondents Marital Status Frequency Percentage (%) Single 27 60 Married 18 40 Total 45 100 The marital status distribution indicates that the majority of respondents (60%) are single, which correlates with the young age profile of the workforce. This demographic characteristic may influence career mobility and organizational commitment patterns within the company. Table 4 Organizational Status of Respondents Position Level Frequency Percentage (%) Junior Staff 5 11 Senior Staff 27 60 Management 13 29 Total 45 100 The organizational hierarchy shows that senior staff constitute the majority of respondents (60%), followed by management (29%) and junior staff (11%). This distribution provides a balanced perspective across different organizational levels, with senior staff being well-represented to offer insights into operational advertising impacts. World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 1686 Table 5 Length of Service Distribution Years of Service Frequency Percentage (%) 1-5 years 10 22 6-10 years 25 56 11+ years 10 22 Total 45 100 The service tenure distribution reveals that over half of respondents (56%) have 6-10 years of experience with MTN Nigeria, indicating a stable and experienced workforce. This level of organizational experience enhances the credibility of responses regarding long-term advertising effectiveness and organizational performance trends. Table 6 Educational Background of Respondents Educational Level Frequency Percentage (%) GCE/SSCE 5 11 OND/NCE 10 22 HND/BSC 20 44 MSC/MBA 6 13 Professional 4 9 Total 45 100 The educational profile demonstrates a highly qualified workforce, with 44% holding first degrees (HND/BSC) and 22% possessing additional qualifications (MSC/MBA/Professional). This educational diversity ensures that respondents possess adequate knowledge to evaluate advertising strategies and their business implications effectively. 4.2. Advertising Awareness and Perception Table 7 Familiarity with Advertising in Business Response Frequency Percentage (%) Yes 42 93 No 3 7 Total 45 100 The overwhelming majority of respondents (93%) demonstrate familiarity with advertising terminology in business contexts, indicating a sophisticated understanding of marketing concepts among MTN Nigeria's workforce. This high level of awareness validates the reliability of subsequent responses regarding advertising effectiveness. Table 8 Advertising Creates Customer Awareness Response Frequency Percentage (%) Yes 43 96 No 0 0 Undecided 2 4 Total 45 100 World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 1687 Nearly all respondents (96%) agree that advertising creates customer awareness of company products, with minimal uncertainty. This consensus supports fundamental marketing theory regarding advertising's primary function as an information dissemination tool and validates the theoretical foundation underlying MTN's advertising investments. 4.3. Consumer Behavior and Decision Influence Table 9 Advertising Influence on Customer Buying Decisions Response Frequency Percentage (%) Yes 40 89 No 4 9 Undecided 1 2 Total 45 100 A substantial majority (89%) of respondents believe that customer buying decisions are influenced by company advertisements, providing strong empirical support for advertising's persuasive effectiveness. This finding aligns with established consumer behavior theories and justifies continued investment in advertising as a sales driver. Table 10 Advertising Enhances Corporate Image Response Frequency Percentage (%) Yes 30 67 No 10 22 Undecided 5 11 Total 45 100 Two-thirds of respondents (67%) agree that advertising enhances positive corporate image perception, while 22% disagree and 11% remain undecided. This moderate consensus suggests that while advertising contributes to brand building, other factors may also significantly influence corporate reputation and image formation. 4.4. Competitive Strategy and Market Position An overwhelming majority (87%) of respondents believe advertising helps organizations sustain competition, indicating strong recognition of advertising's strategic role in competitive positioning. This finding supports competitive strategy theories that emphasize advertising as a critical tool for market differentiation and competitive advantage maintenance. Table 11 Advertising Helps Sustain Competition Response Frequency Percentage (%) Yes 39 87 No 4 9 Undecided 2 4 Total 45 100 Nearly all respondents (93%) confirm that MTN engages in intensive advertising to outperform competitors, demonstrating the company's commitment to aggressive marketing strategies. This finding reflects the highly competitive nature of Nigeria's telecommunications market and MTN's strategic response through substantial advertising investments. World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 1688 Table 12 Intensive Advertising to Outperform Competitors Response Frequency Percentage (%) Yes 42 93 No 3 7 Total 45 100 4.5. Sales Performance and Financial Impact Table 13 Annual Profit Increase Due to Advertising Response Frequency Percentage (%) Yes 38 84 No 7 16 Total 45 100 A significant majority (84%) of respondents agree that company profits increase annually due to advertising, providing strong empirical evidence for advertising's positive financial impact. This finding validates the economic rationale for advertising investments and supports theoretical models linking advertising expenditure to profitability. Table 14 Continuous Advertising and Customer Patronage Response Frequency Percentage (%) Yes 40 89 No 5 11 Total 45 100 An overwhelming majority (89%) of respondents confirm that continuous advertising leads to sustained customer patronage, highlighting advertising's role in customer retention and loyalty building. This finding emphasizes the importance of consistent advertising presence for maintaining market share and customer relationships. Table 15 Advertising Effect on Consumer Buying Behavior Response Frequency Percentage (%) Yes 38 84 No 7 16 Total 45 100 The results show that 84% of respondents agree that advertising affects consumer buying behavior, reinforcing earlier findings about advertising's persuasive power. This consensus validates behavioral marketing theories and supports the continued strategic use of advertising for influencing consumer decision-making processes. 4.6. Testing of hypotheses The hypothesis 1 and 2, chi-square x2 is used as testing instrument to test whether to accept or reject the hypotheses. Chi-square formula is ×2=0E Where World Journal of Advanced Research and Reviews, 2025, 26(03), 1681-1693 1689 • O=summation • 0=columns or cells • E=E×pectedfrequency To calculate degree of freedom df=n-1(r-1)(c-1) where • df = degree of freedom • r=rows • c=columnsorcells • n=number • Hypothesis 1 o Ho-Training does not improve employee's productivity o H1Training improves employee's productivity • Question 12: Does training enhance staff skills, knowledge, attitude and subsequently improve productivity? Responses Observed (O) Expected(E) Yes 29 10 No 1 10 Undecided 0 10 Total 30 30 Note: The expected frequency (E) for each cell is arrived at by dividing the total number of scores of the observed frequency (O) by the numberof rows available i.e. 30/3=10 361+81+100 1010 10 36.1+8.1+10 54.2 df=(n-1) (R-1)(C-1) 1 The critical value (x2) at 0.05 and 0.01 significance level are =2,0.01=9.210 Then the calculated value=54.2 4.7. Decision Rule Accept null hypothesis if the calculated value less than the critical value and reject null hypothesis if the is less than the calculated value. Therefore, since the critical is greater than the calculated value,null hypothesis (HO) Training does not improve employees productivity is rejected while the alternative hypothesis (H1) is accepted.