Effect of Promotion mix strategies on profitability:The case study on Commercial Bank of Ethiopia
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Date
2018-05-19
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Abstract
Ethiopia’s financial services industry is one of the least developed in the region. They are
confined in small area and compete over the same customers with limited services. Survey shows
that only 43.5 % of urban and 53.6 % of Addis Ababa population had bank accounts. The
purpose of this study is to determine the effect of Promotion mix strategies on the profitability of
Commercial Bank of Ethiopia. A quantitative and qualitative research approach was applied to
collect data from employees and customers in the CBE. The target population of the study was
CBE employees and customers who are found in Addis Ababa. Systematic Simple random
sampling technique was employed and sample sizes of 378 employees and 384 customers were
selected. To accomplish this, a questionnaire survey was conducted by taking the most important
promotion mix elements that were identified by several researchers from literature. For the sake
of achieving the objectives of this study, questionnaires were analyzed using descriptive and
inferential analyses with the help of SPSS version 20 statistical software program. Pearson
correlation and multiple linear regression analysis were done to test the relationship between
promotion mix elements and profit. The study reveals that all promotion mix elements such as
advertising, sales promotion. Personal selling, public relations and publicity, and direct
marketing have significantly and positively effects on CBE profitability. But according to the
employees’ response direct marketing has no effect on profitability of CBE. The result confirms
the hypothesized relationships in the research model. Therefore managers and policy makers in
the bank should give outstanding attention to profound promotion strategies and practices.
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Keywords
Advertising, Sales Promotion, Personal Selling